Saudi Arabia was the GCC projects market worst hit by the pandemic; contract spending fell by more than 50 per cent from a high of $51bn in 2019 to just $22bn last year. Covid was the chief reason for this decline, but the fall in oil prices also had a significant impact on government spending.
The market this year is recovering but not at a pace that might have been first expected. In the first nine months of the year, about $18bn worth of contracts had been awarded, with the reasonable expectation
therefore that 2021 will exceed last year’s numbers, albeit only by a small margin.
This is undoubtedly disappointing given the initial 2021 forecast of $36bn. However, there are signs that things are picking up especially among the PIF gigaprojects program including the Red Sea Tourism Project and most particularly Neom where a raft of tenders have been issued under clear political direction to accelerate construction.
This bodes well for the coming year, which should finally see the PIF program enter full swing. Combined with life getting back to normal and oil prices returning to more than $80 a barrel, this points to 2022 being a much better year.
What now needs to be seen is if the kingdom has the logistical and contracting capability to deal with the immense potential workload.
Without improved co-ordination among the main clients, public and private, it remains to be seen whether Riyadh will be able to implement its plans at the pace it wants.
Saudi Arabia Projects H2 2021 is the update to this year’s H1 report.
Focused on data, it is aimed at helping companies create strategies for targeting and growing the market. It uses almost exclusively data from MEED Projects (www.meedprojects.com), the region’s leading online projects tracking service. With 15,000 active projects tracked and more than 35,000 in total in the database, MEED Projects makes it possible to quantify current, historical and future trends in the projects market in the region.
I am certain that this report can help you achieve success in Saudi Arabia.