According to a new report released by dmg::events in conjunction with consultancy Ventures Middle East, the total value of building projects in Gulf Cooperation Council states will exceed $80 billion this year.
The results of the survey found that the overall value of projects will increase by nearly one-fifth to $81.6 billion in 2013 from $69 billion last year. The interlinked market for interior contracting and fit-out was valued in the report at $7.86 billion, a 56 per cent increase over the 2011 figures.
The UAE has the largest interiors spend in the region at $2.83 billion. Saudi Arabia is in second place at $2.6 billion and Qatar is in third spot with $1.49 billion.
The increase in construction activity in 2012 builds on higher growth rates from 2011 when the overall increase was 48 per cent. Most of the growth was attributed to projects in the medical, education and hospitality sectors. The region is committed to investing in public infrastructure as a way to energise the economy.
The government of Abu Dhabi has announced plans to spend approximately £56 billion on capital projects over the next five years. Its goal is to restructure its economy to reduce its reliance on oil and gas. Abu Dhabi is the largest emirate state. This investment is a sign of a significant shift in the economic focus in the region.
The investment will include spending on schools, roads, housing, and other public infrastructure. The government will also commit funding to healthcare. Programs will be put in place to set up “tax-free enterprise hot-spots” that will attract a number of businesses to the emirate.
The government has the means to afford to put its plans into place, since its oil revenues increased to £44 billion in 2011 from £29 billion the previous year. Government spending increased by 20 per cent to £53 billion during the same period.
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