Bahrain Business: GCC project market poised for continued growth in 2025

The GCC project market is set for another banner year in 2025, building on the record-breaking performance of 2024, according to Kamco Invest.

A combination of factors, including robust economic activity, government commitment to project execution, a supportive banking sector, and elevated oil prices, are expected to drive significant contract awards.

However, challenges remain, including global supply chain disruptions, the impact of rising interest rates, and the potential impact of Opec+ quotas on government investment.

Key opportunities for the GCC project market include significant investment in the industrial sector, particularly focusing on increasing regional materials processing and manufacturing capacity, with potential for substantial growth in sectors like chip manufacturing.

The utilities sector is also poised for growth, driven by undercapacity in the power sector and increased demand for new projects, along with a rise in investment in water and wastewater treatment facilities. Furthermore, the growing emphasis on AI and data centres is likely to spur investment in related technology projects.

Approximately $1.5 trillion worth of projects are currently in the pre-execution stage across the GCC, with Saudi Arabia leading the way.

Key upcoming projects include the $5 billion Taziz Industrial Chemicals Zone-Phase II, the $3.7bn National Grid Battery Energy Storage Systems, and the $3bn Taweelah C Combined Cycle Gas Turbine (CCGT) IPP.

In 2024, GCC project awards reached a new record of $273.2bn, representing a 9.6pc year-on-year increase from 2023. The power and oil sectors were key drivers of this growth, recording $67bn and $29.7bn in contract awards, respectively. While the construction sector remained the largest sector with $75.4bn in contract awards, Q4 2024 witnessed the highest quarterly project award value in over six years, reaching $74.8bn.

avinash@gdnmedia.bh

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