Dhaman": Arab countries attracted 1129 foreign projects in the construction sector worth $430 billion, over 22 years

Cement consumption in Arab countries is expected to rise to more than 281 million tons per year by 2030

The Arab Investment & Export Credit Guarantee Corporation (Dhaman) revealed that the construction sector in Arab countries attracted 1129 foreign projects during the period from January 2003 to July 2024, with Capex of about $430 billion. These projects created more than 611,000 jobs.

In its third sectoral report on the infrastructure and construction sector in Arab countries for 2024, issued at its headquarters in the State of Kuwait, the Corporation indicated that 5 Arab countries namely the UAE, Saudi Arabia, Morocco, Egypt and Oman, attracted over 22 years 765 foreign projects with a share of 68% of the total, with Capex of more than $269 billion with a share of 63%. These projects created more than 371,000 jobs, making up 61% of the total.

The report focuses on four main pillars: 1- the evolution and outlook of the construction sector’s output until 2030, 2- foreign trade in products and services related to the construction sector for 2023, 3- foreign projects in the construction sector, 4- assessment of risks of investment and business related to the infrastructure sector. It added that the UAE came on top as the most important investing country in the Arab region, having implemented 242 projects in the region over the past 22 years, with a Capex of more than $139 billion, creating more than 170,000 jobs.

The report showed that the top 10 companies accounted for about 16% of the number of new projects implemented, 31% of the capex and 15.3% of all new jobs. US-based “Marriott International Inc.” topped the list according to the number of projects with 27 projects representing 2.4% of the total. UAE's “Majid Al Futtaim Group” was the largest investor in terms of Capex with a value of more than $23 billion with a share of 5.5% of the total, while UAE's “Emaar Properties Group” came first in terms of the number of new jobs with more than 16000 jobs with a share of 2.7% of the total.

As for risks and rewards of investment and business related to the infrastructure sector in 14 Arab countries, according to Fitch, they were monitored through two risk and reward indicators. According to the results of the two indicators for 2024, Saudi Arabia ranked first as the best Arab country in terms of lower risks and higher rewards to become the most attractive Arab market for investment in the infrastructure sector, followed by UAE, Qatar and Oman, respectively.

The report predicted a 3.6% increase in the gross output of the construction sector in the Arab region (15 countries) to $498 billion by the end of 2024, making up more than 5% of the global total, with expectations that it will keep rising to about $707 billion by 2030. The report also pointed out the high geographical concentration of this output in a limited number of countries. Five countries: Saudi Arabia, UAE, Qatar, Algeria and Egypt, held 80% of Arab's output of the construction sector in 2024.

In terms of the gross value added (GVA) of the construction activity in the Arab region (15 countries), it is expected to rise by 3.9% to reach about $219 billion by the end of 2024, with a possible further increase to reach $317 billion by 2030.

The report showed that the total cement production of Arab countries is expected to exceed 197 million tons, marking an increase of 2.8% by the end of 2024, while cement consumption is likely to hit 220 million tons, recording an increase of 4.5% during the same year, with forecasts that production and consumption rates will shoot up to roughly 232 million tons and 281 million tons respectively by 2030.

Regarding the value of Arab countries' foreign trade in goods and services related to the construction sector, the report indicated a hike of 3% in 2023 to more than $193 billion, accounting for 5.7% of total Arab trade in goods and services during the same year.

The report added that the top 10 exporting countries to the region held 76.4% of the Arab countries' total imports of products related to the construction sector with a value of nearly $88 billion. As China topped the list as the largest exporter with a value of more than $42 billion and a share of 37% of the total. On the other hand, the top 10 importing countries from the region had 58% of the Arab countries' total exports of construction-related products at a value of $34 billion, with Iraq topping the list as the largest importer at a value of more than $9 billion and a 16% share.