GCC infrastructure spend to boost non-oil GDP
Friday, 12 20 2019, Category: Economy, Country: Gulf Cooperation Council
The GCC is ready to throw off the shackles of lower GDP growth in 2020 with spending on infrastructure forecast to boost the region’s non-oil expansion. That’s the upbeat forecast in a report by Ventures Onsite, the construction intelligence partner of Intersec, the world’s leading trade fair for security, safety and fire protection.
The report says that while rising oil and gas production will likely help lift GCC growth to 2.5% in 2020, infrastructure spending, particularly in the UAE and Kuwait could lift country-specific non-oil GDP from 2.4% in 2019 to 2.8% next year.
The construction sector, says the report, will be in the vanguard of the GCC’s forecasted non-oil growth. “The region’s large-scale degree of investment in infrastructure and capital projects, and anticipated tourism boom are poised to register growth for the region’s GCC construction sector. This in turn, along with economic diversification plans in the GCC region, is also expected to drive the fire safety systems and equipment market over the coming years.”
Ventures Online suggests the GCC’s total construction contractor awards across the building, infrastructure and energy sectors are expected to increase from $134,002 million in 2019 to $139,909 million in 2020 with the UAE and Saudi Arabia being the industry’s top two performing markets next year. The report predicts the UAE may increase its federal budget by 2% in 2020 to $17 billion. The forecast has led to a bullish prediction from the KPMG annual Global Construction Survey which points to an anticipated growth of between 6-10% in the UAE’s construction sector in 2020.
“Industry leaders surveyed in the UAE are optimistic about growth prospects and are confident that technology and governance will play a significant role in the construction sector in the next five years,” predicts the KPMG survey.