Middle East Construction Market Size, Share, and Competitive Analysis by 2028 - A Comprehensive Study from TechSci Research

The Middle East construction market is poised for substantial growth in the upcoming years, as governments across the region focus on ambitious smart city initiatives and liberal trade policies attract foreign investments. According to the TechSci Research report, "Middle East Construction Market - By Country, Competition, Forecast & Opportunities, 2028," the market is expected to register a high compound annual growth rate (CAGR) in the future period.

Driving Forces Behind the Middle East Construction Boom

1. Smart City Initiatives and Digital Transformation

Several governments in the Middle East are prioritizing smart city plans and digital transformation initiatives. For instance, the UAE government is planning to digitalize up to 1,000 government services and install 2,000 Wi-Fi hotspots in developed locations. These ambitious projects are fueling the demand for construction activities and infrastructure development.

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2. Favorable Investment Policies and Foreign Direct Investment

Liberal trade policies in countries like the UAE are inviting foreign investors and helping to boost the Middle East construction market. The region's attractive investment climate, coupled with government initiatives to diversify their economies, is driving significant foreign direct investment (FDI) in the construction sector.

3. Public-Private Partnerships (PPP)

The public-private partnership (PPP) model is being widely adopted across the Middle East, enabling the provision of efficient goods and services at lower costs. In 2020, the Abu Dhabi government announced an impressive project to purchase USD 2.72 billion worth of infrastructure partnership projects in various industries, including education, transportation, and municipal works. The PPP initiative was created as part of Abu Dhabi's USD 14 billion "Ghadan 21" stimulus program to improve the country's economic growth rate.

4. Major Infrastructure Projects

Significant infrastructure projects are underway across the Middle East, contributing to the growth of the construction market. For instance, in January 2022, NMDC won a USD 354 million contract from AD Ports Group for the Shamal Development marine works, which includes dredging, quay wall construction, and the construction of a detached breakwater.

5. Urban Regeneration and Public Space Enhancement

Several Middle Eastern countries are investing in urban regeneration and public space enhancement initiatives. For example, Abu Dhabi has announced a new initiative that will enhance urban spaces and nature sites, with an investment of Dh 8 billion (USD 2.2 billion) across the main regions of Abu Dhabi, Al Ain, and Al Dhafra to effect 300 enhancements ranging from small-level interventions to large-scale public space regeneration.

Market Segmentation and Key Opportunities

The Middle East construction market is segmented based on type, end-user, sector, construction type, and region, providing valuable insights into the market dynamics and growth opportunities.

Type Segmentation

Based on type, the market is segmented into building construction, heavy & civil engineering construction, and others. Building construction, which includes residential, commercial, and industrial projects, is expected to be a significant driver of market growth.

End-User Segmentation

In terms of end-users, the market is segmented into private and public sectors. Both segments are expected to contribute significantly to the market's growth, driven by government initiatives and private sector investments.

Sector Segmentation

Based on sector, the market is segmented into commercial, residential, industrial, and infrastructure. The commercial and residential sectors are anticipated to witness substantial growth, fueled by urbanization, population growth, and increasing disposable incomes.

Construction Type Segmentation

In terms of construction type, the market is segmented into new construction and repair & maintenance. New construction projects, driven by infrastructure development and urban expansion, are expected to dominate the market.

Regional Analysis

Based on country, the market is segmented into Saudi Arabia, UAE, Qatar, Kuwait, Bahrain, Israel, Iran, and the rest of the Middle East. Saudi Arabia is expected to dominate the market during the forecast period, driven by the country's ambitious Vision 2030 plan and the government's focus on diversifying the economy away from oil.

Competitive Analysis

The Middle East construction market is highly competitive, with numerous local and international players vying for market share. Key players in the industry include Arabtec Construction, Saudi Binladin Group, Consolidated Contractors Company, El Seif Engineering Contracting, and Drake & Scull International, among others.

To gain a competitive edge, these companies are employing various strategies, such as strategic partnerships, mergers and acquisitions, and investments in advanced construction technologies and sustainable building practices. Additionally, a strong focus on project management, cost optimization, and skilled workforce development is crucial for success in this highly competitive market.

Benefits of the Research Report

The "Middle East Construction Market - By Country, Competition, Forecast & Opportunities, 2028" report provides valuable insights and analysis for stakeholders in the construction industry. The key benefits of this research report include:

• Comprehensive market analysis and forecasts, enabling informed decision-making and strategic planning.

• Identification of key trends, drivers, and challenges shaping the Middle East construction market, facilitating proactive measures and risk mitigation.

• Detailed competitive analysis, highlighting the strengths, weaknesses, and strategies of major players, aiding in benchmarking and positioning.

• Segmentation analysis, providing insights into lucrative market segments and opportunities for growth and diversification.

• Regulatory and compliance information, enabling businesses to navigate the complex regulatory landscape and ensure compliance.

• In-depth understanding of emerging technologies and their impact on the Middle East construction market, fostering innovation and adaptability.

Future Outlook and Conclusion

The future of the Middle East construction market is promising, driven by ambitious smart city initiatives, liberal investment policies, public-private partnerships, and significant infrastructure projects. As the region continues to diversify its economies and invest in urban development, the demand for construction activities is expected to surge.

However, challenges such as skilled labor shortages, supply chain disruptions, and the need for sustainable building practices must be addressed to fully harness the potential of this market. Continued investment in technology, workforce development, and sustainable construction methods will be crucial to overcoming these hurdles and unlocking the full potential of the Middle East construction market.

In conclusion, the Middle East construction market is experiencing a transformative period, propelling economic growth and reshaping the region's skylines. By embracing innovative technologies, fostering public-private collaborations, and investing in sustainable practices, the construction industry in the Middle East can play a pivotal role in shaping a prosperous and sustainable future for the region.

Key market players in the Middle East Construction Market include:

• Orascom Construction Plc

• Nesma & Partners Contracting Co. Ltd

• Al Bawani Company

• ALEC Engineering and Contracting (ALEC)

• Arabian Construction Company (ACC)

• ASGC Group

• Arab Contractors (AC)

• Al Naboodah Construction Group

• Almabani General Contractors

• Airolink Building Contracting LLC

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“Countries like Saudi Arabia & Bahrain have high population, due to which authorities of these countries are moving towards smart construction plants. For instance, the population of Saudi Arabia in 2017 was 33.95 million and in 2020 the population reached 37.20 million, generating an enormous demand for houses in the years to come and the development of new cities and government development plans are likely to significantly accelerate the growth of the construction sector. Saudi Arabia is working toward its established Vision 2030 program, followed by the continuation of the country’s associated Giga projects. Construction projects like NEOM, The Red Sea Project, and AMAALA are anticipated to provide positive hike. Sportingly, these developments are creating new job roles in construction and development sector. The Saudi Vision 2030 objective is to create a better living standards for citizens.” said Mr. Karan Chechi, Research Director with TechSci Research, a research-based global management consulting firm.

“Middle East Construction Market By Type (Building Construction, Heavy & Civil Engineering Construction, and Others), By End User (Private, Public), By Sector (Commercial, Residential, Industrial, and Infrastructure), By Construction Type (New Construction, Repair & Maintenance) By Country, Competition, Forecast, and Opportunities, 2028”, has evaluated the future growth potential of Middle East Construction Market and provides statistics and information on market structure, size, share, and future growth. The report is intended to provide cutting-edge market intelligence and help decision makers take sound investment decisions. Besides, the report also identifies and analyzes the emerging trends along with essential drivers, challenges, and opportunities present in the Middle East Construction Market.

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