meed-logo

line1 line2 line3
SIGN IN / REGISTER

GCC banks navigate Credit Suisse fallout

31 March 2023

 

Saudi National Bank chairman Ammar al-Khudairy’s abrupt resignation on 27 March capped a turbulent few weeks for the world’s financial system. This period saw the kingdom’s champion bank dragged into the harsh glare of the global spotlight and serious questions asked about Gulf financial institutions’ readiness to serve as props in an increasingly jumpy financial order.

A short sentence uttered in an interview by a senior Saudi banker precipitated the collapse of a 160-year-old institution. Ruling out extending beyond its 10 per cent stake as it would entail a higher capital cost led to the fellow Swiss bank UBS buying the troubled lender at a steep discount.

Al-Khudairy took the rap for what was deemed an avoidable crisis, in which SNB took a hosing: it bought the Credit Suisse stock at CHF3.82 ($4.2) a share; UBS has paid just CHF0.76 ($0.83) a share.

The pain goes wider than SNB and the Qatar Investment Authority (QIA), the other Gulf institution directly impacted by Credit Suisse’s troubles, given its 6.9 per cent stake in the lender.

The crisis poses serious questions about the role of wealthy Gulf institutions in a global system that is increasingly reliant on them, but has yet to stress test the relationship.

On the one hand, Gulf investors have been spooked about their exposure to venerable banking institutions that were once seen as copper-bottomed plays. Conversely, Western banks may now legitimately ask whether their Gulf counterparts are reliable partners in a crisis.

Volatile landscape

The backdrop is one of wider concern about the health of global financial markets. The Credit Suisse crisis was prefaced by US regulators shutting Silicon Valley Bank (SVB) on 10 March, following mass withdrawals of customer deposits.

For now, analysts caution against panic. First, SNB’s exposure – and that of other prominent Gulf lenders – appears limited.

“The impact of SNB’s investment in Credit Suisse and the subsequent takeover by UBS on SNB are limited because the initial investment represents less than 2 per cent of SNB’s investment portfolio and 70-80 bps of the bank’s risk-adjusted capital ratio,” says Mohamed Damak, senior director, Financial Institutions Ratings, at ratings agency S&P.

As to problems in the Western markets, again, exposures are manageable. “On average, banks we rate in GCC had exposure to the US of 4.6 per cent of assets and 2.3 per cent of liabilities at year-end 2022,” says Damak.

“Generally, GCC banks would have limited lending activity in the US and most of their assets there would be in high-credit quality instruments or with the Federal Reserve. The exposure to Europe tends to be limited as well, except for banks that have a presence in some European countries like France or the UK. Most of the activity in these jurisdictions tends to be linked to home countries or generally made of high-quality exposures.”

This will not end SNB shareholder anxiety that the bank’s raison d’etre – supporting domestic projects related to Vision 2030 – had been sidelined in the pursuit of equity positions in global blue chips.

Qatari contagion

Similar questions will be asked in Qatar, where the QIA provided ballast for the Swiss bank’s balance sheet in 2021, when it issued $2bn in convertible notes. The Qatari wealth fund will be reviewing its bank holdings and stress-testing its wider portfolio.

Others will do the same. “Gulf sovereign wealth funds will probably review their asset allocations, regardless of this current crisis,” one Gulf-based economist tells MEED. “The reality is that their role is changing. They were, in the past, more opportunistic investors. Today they are becoming strategic vehicles.”

If Gulf funds like QIA will no longer serve as the global financial system’s white knights – as they proved in the 2008 financial crisis – this may prompt a reconfiguration of investment strategies.

There will be a steep learning curve, says one Gulf-based economist – on both sides.

Governance implications

In light of the growing financial strength of the Gulf institutions come new responsibilities and governance requirements, reflecting the dawning reality that Gulf institutions are growing into increasingly globally systemically significant investors or sources of capital.

“They need to act accordingly,” says the economist. “Not just from the global governance perspective, but also from the perspective of protecting their assets.”

Gulf institutions’ transformation into opportunistic investors was well-timed when liquidity was required at short notice.

“The money centres of the world turned to one of the biggest honey pots they could identify. And, of course, some of the old reservations were conveniently parked aside, at least for the time being,” says the economist.

The challenge for the Gulf institutions was the lack of deep experience or institutional frameworks needed to underpin those initial investments.

“Opportunities arose, these countries chose to take them and they got lucky because they helped stabilise the global financial system, and they helped protect the reputation of these institutions. And no major mistakes were made. But that initial opportunistic approach will no longer fly,” says the economist.

Gulf sector outlook

The Credit Suisse saga has also prompted much ruminating in Western media to the extent that Western institutions may cast a more wary eye in future over their Gulf counterparts.

But absent new funding sources, the GCC's appeal may prove irresistible to them. After all, says the economist, beggars can’t be choosers.

“What is the alternative to resorting to institutions such as the Gulf sovereign funds? They’re not going to go to China, that’s for sure. The only real alternative is to get some sort of a backstop from national central banks. And that is pretty much as close as you can get to a moral hazard,” he says.

The broader global picture is evolving. How Gulf institutions related to primarily Western institutions will also be influenced by the change in the GCC states’ foreign policy.

Gulf governments are increasingly cognisant of the need for a balanced, multi-directional foreign policy. And that is something they will also want to reflect in their wealth funds and banks’ investment behaviour.

The next year should provide an insight into how the post-Credit Suisse modus vivendi will play out.

https://image.digitalinsightresearch.in/uploads/NewsArticle/10724320/main2803.jpg
James Gavin

Register for MEED's guest program now to access this article.

Click here to register
Exclusive from Meed
Related Articles
  • Saudi Arabia launches Landbridge design tender

    4 April 2025

    Saudi Arabia Railways (SAR) has issued a tender for the lead design consultancy services contract on its long-planned Saudi Landbridge railway network.

    Interested companies have until 15 May to bid for the work, which covers the concept design and options for the preliminary and Issued for Construction (IFC) design stages on the 1,000 kilometre (km)-plus network.

    The estimated $7bn project comprises more than 1,500km of new track. The core component is a 900km new railway between Riyadh and Jeddah providing direct freight access to the capital from King Abdullah Port on the Red Sea.

    Other key sections include upgrading of the existing Riyadh-Dammam line, a bypass around the capital, and a link between King Abdullah Port and Yanbu.

    The Saudi Landbridge is one of the Kingdom’s most anticipated project programmes. Plans to develop it were first announced in 2004, but put on hold in 2010 before being revived a year later, with rights of way issues, route alignment, and its high cost being key stumbling blocks.

    More recently, the project has been under negotiation between Saudi Arabia and China-backed investors keen to develop it on a public-private-partnership (PPP) basis. However, the launch of a design tender directly by SAR suggests that Riyadh is looking at other options to develop it alongside the Chinese proposal.

     

    In December 2023, MEED reported that a team of US-based Hill International, Italy’s Italferr and Spain’s Sener had been awarded the contract to provide project management services for the project programme.

     

    If it proceeds, the Landbridge will be one of the largest railway projects ever undertaken in the Middle East, and one of the biggest globally. Based on typical design timeframes, tenders for construction are likely to be ready by mid-2026, although the question on how it will financed will need to be answered before it can proceed to the next step.

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13611386/main.jpg
    Edward James
  • Tadweer and Tribe seek nod for $1.5bn Australia project

    4 April 2025

    The first project emerging from the Comprehensive Economic Partnership Agreement (Cepa) signed between the UAE and Australia in November 2024 is making good progress. 

    The Parkes Energy Recovery (PER) project will convert waste to electricity to power homes, businesses and industries across New South Wales (NSW) on Australia's east coast.

    According to Fahad Obaid Al-Taffaq, UAE Ambassador to Australia, Parkes Energy Recovery, led by Australia-headquartered Tribe Infrastructure Group and Abu Dhabi's Tadweer Group, is kicking off its consultation process to engage with stakeholders and secure approvals for the $1.5bn energy-from-waste facility.

    "This project, a key development after signing the UAE-Australia Cepa, will power 80,000 homes, create jobs, and foster long-term, sustainable growth," Al-Taffaq said in a social media post in March.

    The proposed facility will divert an estimated 600,000 tonnes of waste annually from landfill and generate at least 60MW of energy.

    The anticipated capital investment of $1.5bn makes the project the "largest single investment in the history of Parkes", the Parkes Shire Council website said in March.

    MEED understands that councillors and the council’s Executive Management Team met with representatives from Parkes Energy Recovery on 18 March to discuss the proposed project.

    The project is expected to tap "proven technology" from Zurich-headquartered Kanadevia Inova, formerly Hitachi Zosen Inova, to turn waste into electricity.

    Tribe, Tadweer, Australian waste solutions firm HiQ and Kanadevia Inova comprise Parkes Energy Recovery.

    The Regional Growth NSW Development Corporation (RGDC) selected the team following a "market process to identify a developer, which included scrutinising the consortium and the technology offered".

    The Parkes Shire Council said in March that the consortium "will now begin the process of wide community engagement and the planning and environmental approvals process for the facility that it will design, fund, own and operate on land leased from RGDC".

    The process will include rigorous planning and environmental approvals with the NSW Environment Protection Authority (EPA) and the Department of Planning, Housing and Infrastructure (DPHI).

    Cepa objectives

    According to a legal note by UK-based law firm Watson, Farley & Williams (WFW), the Cepa free trade agreement offers Australian business major benefits that include elimination of tariffs on over 99% of exports from Australia to the UAE by value, as well as guaranteed market access in over 120 service sectors and subsectors.

    WFW also notes that Australia and the UAE have agreed on five memoranda of understanding highlighting sectors that the two countries intend to work on to facilitate and enhance their investment relationship. These are green and renewable energy, data centres and artificial intelligence (AI) projects, minerals sector; food and agriculture, and infrastructure development.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13613963/main.jpg
    Jennifer Aguinaldo
  • Region’s hotel projects pipeline balloons

    4 April 2025

     

    This package also includes: Beaches and luxury drive regional tourism

    Despite a somewhat lackluster 2024 performance in the region for hospitality-linked project award activity, Middle East and North Africa (Mena) contractors are eyeing more than $60bn in projects in design and bid that are set to proceed to market in the near future.

    Last year, project awards in the Mena region’s hospitality-linked construction segment declined slightly to $6.2bn, falling below the contract award values in both 2022 and 2023, while remaining above that of the three preceding years and the average for the past five years.

    Also positively, the awards value for 2024 was commensurate with the value of projects in the bidding phase this time last year, when $1.3bn-worth of projects had been awarded and $5.2bn-worth of projects were in the bidding phase. This indicates that projects in the segment are delivering and not stalling.

    Top projects

    Saudi Arabia dominated the overall project activity in the segment with a total contract award value of $4.4bn. This was followed by the UAE at $1bn and a handful of other countries with a combined $700m in value – making for a significantly skewed project activity landscape.

    The largest single project to be awarded was the $762m Keturah Creekside Resort, a Ritz-Carlton Residences scheme in Dubai that is being developed by the local Mag Property Development. The main contract was awarded to Cecep Techand Middle East, a Dubai-based contracting subsidiary of a Chinese state-owned enterprise that is generally better known for its involvement in utility projects.

    The next largest award was for the $508m Six Senses Falcon’s Nest Hotel in the Wadi Safar area of Saudi Arabia’s Diriyah gigaproject. This contract was awarded by Diriyah Company to a joint venture (JV) of Qatar’s UCC Holding and local construction group Al-Bawani. 

    Diriyah Company also let the contracts for four other hotels at Wadi Safar – Aman, Chedi, Faena and Oberoi-branded properties worth a combined $826m – to the same JV. 

    Three further Diriyah projects worth a combined $519m were awarded for the building of a Capella hotel, a Raffles hotel and a Ritz-Carlton Residences to a variety of other contractors.

    Significant gigaproject-linked contract awards were also made on the Amaala development within Red Sea Global’s project portfolio, and for a hotel complex at Qiddiya, the Riyadh-adjacent entertainment city. 

    The largest contract awarded in a third country was a $125m Avani-Tivoli hotel and residences project in Bahrain let to local contractor Cebarco by Bahrain Real Estate Investment Company (Edamah) as part of the Bilaj Al-Jazayer development.

    Project pipeline

    Looking ahead in 2025, there are $8.6bn-worth of projects in the bidding phase, with $3.9bn at the prequalification stage, $2.2bn in bid submission and $2.5bn in bid evaluation. If all of this value is awarded as expected, alongside the $410m in awards so far this year, then 2025 could turn out to be the best year for hotel project activity since 2015.

    There is also a much larger groundswell of projects in the design phase. This time last year, the value of projects in design was $15bn, but that value has swollen by 270% to $56bn in the past 12 months, led by Egypt’s launch of South Med, a 2,300-hectare tourism masterplan valued at $21bn. 

    Launched by Talaat Moustafa Group, the South Med project is situated 165 kilometres (km) to the west of Alexandria on Egypt’s northern Mediterranean coastline and 60km east of Ras El-Hekma, an area earmarked for development by Abu Dhabi following a $24bn deal for the land rights.

    Between the two masterplans, Egypt’s northern coast promises to generate a significant amount of construction work in the years to come, and developments in the area are also accelerating as the stretch of coastline grows in significance as a source of interest for investors. Local developer Sodic, which in 2021 become a subsidiary of UAE developer Aldar, launched its own plans in September to deliver a $500m Nobu hotel and residences complex just east of the Ras El-Hekma area.

    In Saudi Arabia, which accounts for $41.6bn or 50% of the hospitality project pipeline in the Mena region – including $24.4bn-worth of projects in design – the pending work is led in value terms by the $7bn in-design second phase of the Red Sea Project. There are also four packages of work worth a combined $3bn in design for the towers and podiums of the Mukaab project – the cubic centrepiece of the New Murabba development in Riyadh. Meanwhile, a further $3.8bn of projects are in design or bid – split $1.8bn and $2bn, respectively – at the Rua Al-Madinah development.

    The next-largest areas of pending hospitality projects in the region are in the UAE and Oman. The UAE’s pipeline is led by Emaar’s $1.5bn Dubai Creek Harbour Tower and a $1.3bn JW Marriott Resort & Residences planned by private developer Wow Resorts for Al-Marjan Island in Ras Al-Khaimah. In Oman, the projects are led by the $500m third phase of the tourism ministry’s Yenkit Hills development and a $500m Trump resort being developed by Omran, the UAE’s Dar Al-Arkan and the US’ Trump Organisation.

    If even a small fraction of the $56bn of hospitality-linked projects in the design phase in the region proceeds to execution in 2025, it could swell the awards total to record levels. After a somewhat sluggish performance in Q1, awards activity could pick up markedly from Q2 onwards, given the $2.5bn in projects that are already in bid evaluation and are set for imminent award.

    Beaches and luxury drive regional tourism

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13570689/main.gif
    John Bambridge
  • Beaches and luxury drive regional tourism

    4 April 2025

     

    This package also includes: Region’s hotel projects pipeline balloons

    In November last year, Saudi gigaproject developer Red Sea Global opened the Shebara resort. The resort’s futuristic architecture – with metallic orbs seemingly floating above the Red Sea – is indicative of the kingdom’s efforts to transform its tourism sector to attract international leisure visitors with sandy beaches and year-round sunshine to supplement its religious tourism offerings.

    While the room rates may mean visiting the resort is just an aspiration for many, its impact has been wide-ranging as social media posts by influencers visiting the resort highlight what Saudi Arabia now offers as a tourist destination.

    Diversifying its offering is a key part of Saudi Arabia’s tourism strategy, which aims to attract 70 million international visitors by 2030. 

    In January, Saudi Arabia’s tourism minister reported that the kingdom had welcomed a record 30 million international visitors in 2024. This figure marks a significant rise from 2019, when Saudi Arabia opened its doors to international tourism, attracting just over 17.5 million visitors.

    Despite the progress, the growth rate in 2024 was 9.4%, which is slower than previous years. In 2023, arrivals jumped by 65% to reach 27.4 million. To achieve its target of 70 million visitors by 2030, Saudi Arabia must achieve an average annual increase of about 6.6 million visitors, equating to a growth rate of nearly 15% a year.

    The opening of Shebara and other beach resorts will be vital to achieving this target.

    Diversifying its offering is a key part of Saudi Arabia’s tourism strategy, which aims to attract 70 million international visitors by 2030

    Beach resorts

    While the GCC’s coastal regions and islands have been developed for tourism for decades, they are increasingly becoming magnets for travellers. According to GlobalData’s Q2 2024 survey, 54% of respondents globally prefer sun and beach holidays, a trend that the GCC is well-positioned to capitalise on.

    Saudi Arabia is tapping into this demand with development projects on the country’s west coast, including the Red Sea Project, Amaala and several schemes within the Neom masterplan. 

    On the other side of the Arabian Peninsula, the UAE – particularly Dubai and Abu Dhabi – has long been a favourite for beachgoers, boasting luxurious beachfront resorts. These destinations are not only about relaxation, but also offer adventure activities, from water sports to desert safaris, enhancing their appeal to a broad spectrum of tourists.

    These beachfront offerings have helped the UAE’s tourism sector recover from the lockdowns during the Covid-19 pandemic. Dubai welcomed 18.7 million international overnight visitors in January to December 2024, a 9% year-on-year increase that surpassed the previous record of 17.2 million in 2023, according to data from the Dubai Department of Economy & Tourism.

    Room capacity is being added to cater to the growing numbers of tourists. According to property consultancy Cavendish Maxwell, Dubai’s hotel inventory will grow by 3.1% in 2025, with 3.4% growth predicted for 2026. By the end of 2027, Dubai is set to have more than 162,600 rooms across 769 hotels.

    High-end offering

    Luxury tourism is another pillar of growth for the GCC’s tourism sector. The UAE and Qatar have already established themselves as luxury destinations, attracting high-net-worth individuals and affluent travellers. Dubai’s high-end hotels and shopping malls are just some of the well-developed luxury tourism experiences on offer in Dubai.

    In 2024, almost 70% of room supply in Dubai was in the high-end category, according to Cavendish Maxwell, while for upcoming supply in 2025, nearly 70% will be in the high-end or upper-upscale segment.

    Similarly, the Pearl-Qatar destination and the award-winning experiences offered by Qatar Airways have positioned Doha as a luxury hotspot.

    Saudi Arabia is also making strides in this sector. In addition to developments like Shebara offering luxury experiences, there are high-end tourism projects being developed across the kingdom. Most recently, gigaproject developer Diriyah Company announced the Luxury 1, a 325-key hotel, which will be the brand’s first property in the Middle East. It will be part of a media and innovation district within the Diriyah project on the outskirts of Riyadh.

    Diriyah Company is also building residential projects that will be operated by luxury hotel brands. These include Armani, Baccarat, Corinthia, Raffles and Ritz-Carlton branded residences.

    Traditional strength

    While beaches and luxury are creating new opportunities, religious tourism remains the cornerstone of Saudi Arabia’s tourism strategy, driven by the millions of Muslims that visit Mecca and Medina for Hajj and Umrah. 

    A recent legal change allowing foreign ownership of land-owning companies in these cities marks a significant shift in Saudi Arabia’s approach to attracting foreign investment. This move is part of a broader strategy to bolster the economy and enhance the appeal of the Saudi financial market.

    The Saudi government’s Vision 2030 aims to increase tourism to 150 million visits annually by 2030, with religious tourism playing a crucial role. The kingdom is investing in infrastructure to accommodate the growing number of pilgrims, with the expansion of airports, hotels and transportation networks under way.

    The introduction of electronic and tourist visas has also made it easier for pilgrims to combine their religious journeys with other tourism experiences, broadening the scope of religious tourism to include cultural and heritage tourism.

    The GCC’s tourism sector is poised for significant growth, driven by the dual pillars of beach and luxury tourism, and complemented by religious tourism. The region’s investments in resorts and supporting infrastructure, coupled with its natural and cultural attractions, position it as one of the world’s most exciting tourism destinations.

    Region’s hotel projects pipeline balloons

    Main image: High-end beachfront resorts such as Red Sea Global’s Shebara will be vital in achieving Saudi Arabia’s tourism targets. Credit: Red Sea Global – Shebara

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13569292/main.gif
    Colin Foreman
  • Muted public spending hinders global tunnelling

    4 April 2025

     

    This package also includes: Traffic drives construction underground

    The pipeline of tunnel construction projects around the world as tracked by GlobalData stands at $1.3tn, encompassing projects from announcement to execution.

    The total pipeline value reflects the overall values of projects that are either entirely tunnels or that have tunnels as an integral part of the work. The project pipeline includes tunnelling works across a range of sectors, including road and railway development, as well as water and sewerage.

    The pipeline of tunnel construction projects around the world currently stands at $1.3tn

    Subdued spending

    Public spending is anticipated to remain muted globally in the short term, as governments are still trying to curtail expenditure to reduce public debt, thereby constraining investments in public infrastructure. This is affecting the demand for tunnel construction, which heavily relies on public infrastructure development. Elevated construction material prices, high interest rates and labour and skill shortages are expected to discourage new investment, further reducing demand for tunnel construction.

    These challenges have already impacted project viability, leading to the withdrawal or postponement of funding for 50 projects in Australia’s $78.6bn infrastructure investment programme due to cost increases of over $21bn. The conflicts in Russia and Ukraine, the situation in Gaza and disruptions to shipping in the Red Sea are weighing on new investment levels, particularly in Eastern Europe and the Middle East and North Africa region due to increased uncertainty.

    However, this decrease in new tunnel investment is not expected to be uniform globally, as China’s significant infrastructure investment drive, the US’ Infrastructure and Jobs Act and India’s various infrastructure investment programmes are driving new investment in their respective regions.

    > Middle East and North Africa (Mena)
    The Mena region has a tunnel construction pipeline valued at $128.6bn. The UAE is one of the leading markets, with $25.4bn of projects that are mainly for metro systems and water and sewage tunnels. Across the region, economic factors like high debt and lower oil revenues may hinder the progress of these projects in the future.
    > Western Europe

    Western Europe has a tunnel construction project pipeline valued at $329.5bn, with Switzerland leading with $60.6bn of projects, follwed by Germany with $56.8bn. Notable projects include the Turin-Lyon tunnel and the Genoa underwater tunnel. Projects in pre-execution and execution stages total $222.8bn, with the highest-value project being Zurich’s $38.8bn CST (underground cargo) Freight Metro Tunnel.

    > Northeast Asia

    Northeast Asia’s tunnel construction pipeline is valued at $327.7bn, with China contributing $220.3bn, including the $42.4bn Dalian-Yantai undersea railway tunnel. Japan has projects worth $101.3bn, primarily the $65.2bn Tokyo to Nagoya Maglev Railway Line. Most projects are in later development stages, totalling $198.3bn, or 69.8% of the pipeline.

    > Australasia

    Australasia’s tunnel construction pipeline totals $150.1bn, with Australia holding $112.9bn, about 75% of the region’s value. The largest project is the $87bn Melbourne Suburban Rail Loop, a 90km rail loop with 13 stations. Construction on six stations began in 2022, with the entire project expected to finish by 2050, though rising costs and labour shortages may affect this.

    > North America

    North America’s tunnel projects are valued at $92.4bn, with $63.6bn in pre-execution and execution stages. The pipeline includes 921.8km of tunnels, primarily in the US. Railway tunnels are the largest segment at $40.7bn, with the Hudson River Rail Tunnel being the highest-value project at $16bn.

    > Southeast Asia

    Southeast Asia’s tunnel pipeline is valued at $91.3bn, with $55.1bn under construction. Singapore leads with $45.2bn, mainly from rail tunnel projects. The Land Transport Authority awarded a $199m contract for tunnels connecting MRT stations as part of the Cross Island Line’s second phase.

    > Eastern Europe

    Eastern Europe’s pipeline is valued at $56.3bn, with $46.9bn in pre-execution and execution stages. Major contributors include Turkiye, Czechia and Romania, which has the largest share at $16.3bn. The $9bn Bucharest Metro Line 5 is a key project expected to complete by 2033, with spending projected to rise in the coming years.

    > South Asia

    South Asia’s tunnel construction pipeline is valued at $47.9bn, with India contributing $31.9bn, primarily from road tunnels. A notable project is the $1.3bn Thane to Borivali underground tunnel. The pipeline includes 2,043.7km of developments, with spending expected to reach $1.8bn in 2024.

    > Latin America

    Latin America has a growing tunnel construction pipeline valued at $30.3bn, with $28.7bn in later development stages. The region includes 276.2km of projects, with Colombia leading at 92.1km. The highest-value project is the $9.6bn Bogota Metro, which began construction in early 2021.

    > Sub-Saharan Africa

    Sub-Saharan Africa’s tunnel construction pipeline is valued at $6.7bn, with 63.7% in pre-execution and execution stages. The pipeline includes 1,580km of projects, primarily in Tanzania, Ethiopia and Kenya. Spending may reach $685.4m in 2025, but investment constraints may limit new projects.

    In conclusion, while the global tunnel construction industry faces challenges due to muted spending, high construction material prices and geopolitical uncertainties, significant infrastructure investment initiatives in countries like China, the US and India are expected to continue driving new investment.

    Traffic drives construction underground 

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13568541/main.gif
    Colin Foreman