A 10 per cent drop in the value of Iraq’s projects market contributed to the Gulf projects index falling by 2.2 per cent to $2.5 trillion for the week up to 14 February.

The main reason for the decrease in value of Iraq’s projects sector was Baghdad’s decision to downsize its programme to rehabilitate oil and gas export pipelines. The scaling back of the programme resulted in the overall budget for the scheme dropping to $10bn, a reduction of $40bn from the $50bn budget originally planned.

The fall in Iraq’s projects market was compounded by the reduction in the budget of a water project.

Iran recorded a 0.3 per cent drop in the value of its projects market as five projects worth a total of $1.8bn were completed.

The GCC market, which accounts for about 75 per cent of the total Gulf market, decreased in value by 1 per cent to $1.9 trillion, with Kuwait the only country to record growth in the size of its projects sector. The value of projects planned or under way in Kuwait rose by 0.8 per cent to $178.9bn as nine new projects worth an estimated $1bn were added to its index.

The UAE recorded the biggest drop in the GCC, with the value of its projects index slipping by 3 per cent to $557bn. The fall is mainly the result of the estimated $15bn Ghantoot Green City real estate scheme now being considered as on hold.

Qatar’s projects market recorded the second-largest fall in the GCC, with the value of projects planned or under way shrinking more than 1 per cent to $215bn.

The slide was caused by the cancellation of a $2bn petrochemicals scheme and the completion of nine new projects worth a combined $1.8bn. Despite the week-on-week drop, the Gulf projects index is up 2.6 per cent on the same period in 2011.