Iraq projects counter GCC declines

30 May 2011

New schemes in Iraq lift index, but there was little growth for the rest of the Gulf’s projects markets

Contract awards

Biggest contract: $7.25bn

Awarded to South Korea’s Hanwha Engineering & Construction to build a new town near the Iraqi capital of Baghdad

$8.9bn: Value of major contract awards

7: Number of contracts awarded

The announcement of $8.4bn-worth of new projects in Iraq caused the Gulf Projects Index to grow by 0.2 per cent to $2.58 trillion for the week up to 31 May.

The launch of an estimated $7.3bn real-estate development in Baghdad and plans by UK/Dutch Shell Group to build a $1bn Energy City contributed to the 1.9 per cent growth in Iraq’s projects market.

While Iraq’s performance resulted in an overall gain for the region’s projects sector, there was little growth for the rest of the Gulf’s markets.

Project updates
 Project NameProject Status
Saudi ArabiaPrincess Nora bint Abdulrahman University: Package IComplete
IraqNew Town in BaghdadConstruction
UAEAbu Dhabi Microchip FactoryConstruction
Saudi ArabiaAl-Manafie TowersDesign
Saudi ArabiaPP12 Combined Cycle Power PlantTender
For further information visit www.meed.com/meedprojects

The GCC market, which accounts for about 72 per cent of the total Gulf market, recorded a 0.1 per cent fall in the total value of projects. The main reason for this was a fall in the index of Saudi Arabia, the region’s largest projects market.

The kingdom recorded a drop of 0.5 per cent in the total value of projects planned or under way.  The main reason was the completion of two contracts at Princess Noura University, worth a total of $6bn, and a $7bn rail project being put on hold. It was not all bad news for the Saudi market, as 30 new projects worth $8.8bn were announced.

Qatar recorded the biggest increase in the GCC. Its projects market grew by 0.3 per cent as the budget for a Qatar Steel Company project in Mesaieed was increased to $1bn. Kuwait’s projects index recorded an increase of 0.1 per cent as two new power projects worth a total of $180m were added to the MEED projects database.

Upcoming tender deadlines
 ClientContractSubmission date
Saudi ArabiaGeneral Authority of Civil AviationMedina Airport5 June
QatarPublic Works Authority (Ashghal)Lusail Expressway 27 June
Saudi ArabiaInterior MinistryMedical complexes28 June 
KuwaitHealth MinistryAl-Amiri hospital10 July
UAEAbu Dhabi Airports CompanyMidfield Terminal10 July
For further information visit www.meed.com/tenders

Iraq maintains its position as the region’s fastest growing market, with a 37.3 per cent year-on-year increase.

The political instability in the region has resulted in the overall Gulf projects market recording a drop of 12 per cent when compared with one year ago.

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