The Middle East countries are forecast to see 2.3% GDP growth in 2019:
Egypt is starting to see some encouraging signs in its construction sector, 2019 GDP growth is forecast to be between 5.1% and 5.7%, however inflation is extremely high at 13% to 15%. Morocco is beginning to see some promising signs in its economic / construction sector, 2019 GDP growth is predicted to be between 3.1% and 3.4%
Oil-rich Middle Eastern countries are pinning their hopes on oil prices remaining in the $55 to $65 a barrel range, if that’s the case then 2019 will be a decent year for construction in this region of the world, however oil prices have fallen by more than 25% in the last three months. The Middle East’s EPC sector is forecast to expand at a faster rate than any other region in the world at between 3.5% and 5.5% in 2019, assuming oil starts to move upwards again. New construction of oil / gas and infrastructure related facilities is set to see sustained growth in Saudi Arabia in the next two years as the demand for oil related products continues.
70% of Saudi Arabia’s annual revenue is based on oil sales, there should plenty of construction opportunities in 2019 if oil remains at its current price which is uncertain, Saudi Arabia recently announced that it would scale back its daily oil production rate in the anticipation that this would drive oil prices higher. Saudi Arabia has a new and young leader Crown Prince Mohammad bin Salman, who has come under serious criticism since the death of a journalist Jamal Khashoggi in Turkey, he is / was being groomed for the future role of King and has many ideas on how to improve the economy of Saudi Arabia. Unemployment is currently in the 12% to 13% range, reducing the number of expatriates and using more locals is a challenge that is major goal of the Government. A lot of social changes are ongoing in Saudi Arabia look for this situation to continue in the future. The Saudi Arabian Government is trying to reduce the country’s dependency on its oil industry and its oil exports by investing in non-oil related business’s, look for this trend to continue in 2019 and beyond. In the meantime, with oil trading above $55 a barrel look for continued substantial CAPEX expenditures on oil related projects in 2019 and beyond. The housing / residential / commercial/ infrastructure construction sectors are also expected to see growth opportunities in 2019 and beyond, the ongoing conflict in Yemen continues to drag on.
Abu Dhabi is the most expensive Gulf Cooperative Council country for construction services. Abu Dhabi is forecast to spend more than $25 billion on oil / gas, infrastructure and commercial construction projects in the next five years. Some Middle East / North African countries such as Libya, Tunisia, Syria, Jordan and Algeria continue to endure political and economic stagnation. Activity is down perhaps 5% to 10% from 2 to 4 years ago, but the outlook for construction work still remains somewhat positive in the (GCC). Israel’s economy and construction market continue positive as we move into 2019. There are plenty of energy and non-oil related construction projects and opportunities that are still to be had.
Qatar will carry on being one of the world’s fastest growing economies and construction markets even with the economic related boycott from its neighbors. Qatar is affluent with its enormous offshore gas fields. Qatar is current focused on its ongoing construction / infrastructure work related to the 2022 World Cup.