By Pratap John/Chief Business Reporter
Projects worth more than QR90bn will be awarded in Qatar in 2013 taking the market to a level enjoyed during the LNG investment boom, Meed Projects has estimated.
Transport, in particular road and rail schemes, will account for nearly two thirds (about QR62bn) of these, the projects tracker said in an estimate.
In 2012, more than 100 contacts were expected to be delivered in Qatar with a total value in excess of QR90bn, Meed Projects said.
But the number of awards will drop to below 80 and the “top-end expectation” for the year is no better than $14.5bn (about QR53bn), it said. Delays in awarding contracts on the Doha metro have had an impact on the country’s project volumes in 2012, Meed Projects said.
“The schedules for the completion of major pieces of infrastructure ahead of FIFA 2022 World Cup in Doha are getting even shorter,” the researcher said. Qatar remains committed to both FIFA 2022 World Cup and the Qatar National Vision 2030.
Contracts for projects such as the Doha Metro, the national railway and the expressways programme, all cornerstones of Qatar’s ambition, must be awarded in 2013, Meed Projects said.
“Qatar will begin to see a surge in road and rail project awards as the 2022 World Cup build-up gains momentum. The country’s projects sector will be the economic bright spot of 2013. The award of major schemes in Qatar and Kuwait is expected to boost the GCC projects market in 2013, following a lacklustre performance by Saudi Arabia in 2012,” the projects tracker said.
Two years ago, the GCC projects market performed resiliently. The total value of contracts awarded in the region 2011 was $127bn.
“The sheer scale of the budget commitment to social infrastructure investment as well as public sector pay rises and food subsidies meant the outlook for projects in 2012 was positive,” Meed Projects said.
It estimated that contracts worth up to $150bn would be awarded in the GCC region in 2012, largely contingent on the momentum of contract awards continuing in Saudi Arabia.
“That, however, will not be met,” Meed Projects said. By mid-November (of 2012) just $93bn worth of contracts had been awarded, suggesting a more probable total of $110bn for 2012, the lowest value since 2007 and the second lowest total in seven years.
Awards in most GCC markets, notably the UAE, over the nine months of 2012 were equivalent to the same period in 2011 and there are some signs that Dubai is staging a modest recovery.
The depressed state of the region’s projects market is almost entirely due to a disappointing lack of awards in Saudi Arabia.
While Saudi Arabia remains the dominant projects market in the GCC, its share of the region’s total contract awards has fallen to well below 50%. The total value of the contract awards in the kingdom was $32bn in the first nine months of 2012, compared with $55bn over the same period in 2011 and about the same in the first nine months of 2010.