JEDDAH: Construction in the Middle East and North Africa region (MENA) is expected to outpace the global growth rate, a new report sponsored by PwC and carried out by Global Construction Perspectives and Oxford Economics said Wednesday. It noted that a total of $4.3 trillion is forecast to be spent on construction in the region over the next decade, representing growth of 80 percent to 2020. Meanwhile, growth in global construction will outpace world GDP growth over the next decade, the report added, forecasting that global construction will grow by 67 percent from $7.2 trillion to $12 trillion annually by 2020. Mohammad Dahmash, PwC's leader of real estate, construction & engineering for the Middle East, said "particular emphasis will be placed on social and affordable housing to meet the needs of the growing indigenous populations. The procurement process is also getting sophisticated and many countries within the Middle East have started applying 'Build Operate Transfer' and 'Public Private Partnership' schemes which not only help in financing projects but also ensure the efficient implementation and execution to international standards." Within the region, growth in construction will be driven by population increases, economic growth, the desire for diversification and, in some cases, preparations for global sporting events, particularly the 2022 World cup in Qatar. Qatar is the fastest growing construction market covered by the report. Important facilitators of construction growth in the region are expected to include changes to mortgage laws in Saudi Arabia, driving residential construction, and more private participation in infrastructure investment across the region. The report cautions, however, that recent events in the region may delay the growth in construction in some areas. Charles Lloyd, PwC's head of capital projects and infrastructure for the Middle East and North Africa, said "this report shows that the MENA region is likely to continue to be a major source of growth in the global construction market. Demographic factors, economic growth and regional Governments' pursuit of more balanced economies will all be powerful stimuli of construction demand." However, the report also highlighted continued rapid growth in construction in China and India and a rebound in the US market. These factors will mean greater demand for materials and more competition to attract other key parts of the supply chain. Charles Lloyd added that "we may be moving from a buyers' market globally to a sellers' one, and all governments will need to market their investment programs actively if they are to attract world class skills."
