UAE decline pushes Gulf projects index down

13 September 2011

Completion of the Dubai Metro Green line is the main contributor of 1.4 per cent drop in the UAE

Contract awards

Biggest contract: $327m

Awarded to UAE/Australian Al-Habtoor Leighton Group to build Northgate Shopping Mall in Doha

$621.4m: Value of major contract awards

3: Number of contracts awarded

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The Gulf projects index fell by 0.2 per cent to $2.4 trillion for the week up to 13 September, with five out of the six GCC states recording a drop in the value of projects planned or under way.

Oman was the only GCC country not to record a fall in the value of its projects market. The UAE witnessed the biggest decline.

The total value of projects planned in the UAE fell by 1.4 per cent to $615bn, the lowest it has been since June 2007. The main contributor to its decline was the completion of the $3.8bn Green line metro project. The completion of another six projects worth $1.4bn and the removal of a $3bn power and desalination project from the index, also contributed to the drop in the value of the UAE’s projects market.

Project updates 
 Project NameProject Status
QatarPower plantTender
IranPropane Dehydrogenation PlantTender
UAEAl-Zorah Resort Phase IOn  Hold
UAEHassyan Power & Desalination Station – Phase IICancelled
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Qatar’s projects market recorded the second biggest drop in the Gulf, with the total value of projects falling by 0.7 per cent to $225bn. The addition of a $100m sewerage project was not enough to counteract the completion of three projects worth $696m.

Bahrain’s index witnessed a contraction of 0.5 per cent. A revised budget for a gas compressor station project contributed to the drop.

Upcoming tender deadlines
 ClientContractSubmission date
UAEWasl Asset ManagementMeridien Hotel expansion 18 September
OmanTransport & Communications MinistryBatinah Expressway (package 2)26 September
KuwaitDirectorate General of Civil AviationNew runway11 October
UAEAbu Dhabi Health Services Company (Seha)  Al-Ain hospital15 October
UAEAbu Dhabi Airports CompanyMidfield Terminal13 November
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Outside the GCC, Iran’s projects market continued its impressive growth with an increase of 2.2 per cent to $312.2bn. The revival of the estimated $5bn Farsi Offshore block development was the main driver behind the growth. Four new oil and gas projects worth a total of $1.8bn also contributed to the rise of the projects planned or under way in the Persian state.

Iraq remains the Gulf’s fastest growing projects market, recording a 51 per cent year-on-year increase. The political uncertainty across the region this year continues to impact the Gulf’s projects index, with a 13 per cent year-on-year decrease.

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