meed-logo

line1 line2 line3
SIGN IN / REGISTER

Vision 2030 drives tall tower plans

2 October 2023

Commentary
Colin Foreman
Editor

As work restarts on Jeddah Tower, economists and historians will revisit the theory, known as the Skyscraper Index, that the completion of record-breaking towers coincides with recession.

The notion that completing extreme skyscrapers and economic downturns are correlated is a longstanding debate.

The origins of the Skyscraper Index can be traced back to the early 20th century. In the 1920s, the completion of the Chrysler Building (pictured) and the Empire State Building in New York coincided with the Great Depression. The correlation then repeated itself when the Petronas Towers in Malaysia were finished during the Asian financial crisis in the late 1990s.

Then in 2008, construction work for the Burj Khalifa in Dubai was in the final stages as the global financial crisis crippled the emirate’s property market with debt.

There are three broad reasons commonly used to explain the phenomenon. The first is overconfidence and speculation. Building tall towers is an expensive venture, which means the decision to go ahead with them is typically made during a period of economic exuberance. The danger is that this exuberance can also create speculative bubbles that may burst before tall towers are completed.

The likelihood of bubbles bursting before completion is increased by the second reason for the correlation: long construction periods. Record-breaking towers take a long time to plan, design and construct, and during the time between their conception and completion, the economic landscape inevitably changes.

The third reason is the misallocation of resources. In boom times, investors are prone to chasing higher returns without fully assessing the risks. Pouring resources into large building projects is often an example of such misallocations, and when economic corrections occur, these projects can become symbols of excess.

The head start means Jeddah Tower should comfortably be completed before 2030

Improved fortunes

Jeddah Tower has restarted during a period of economic exuberance for Saudi Arabia. Oil prices are riding high, with Brent crude trading at nearly $95 a barrel at the end of September. While output cuts mean the Saudi economy is technically in recession, the performance of the non-oil sector remains robust and record levels of project spending are expected to be achieved by the end of this year.

Top 10 tallest towers in the region 

How long it will take to complete Jeddah Tower is not yet clear. While the tower is a major undertaking, it does have some advantages over a new project. It has already been designed, and the foundations and one-third of the superstructure have been completed.

This head start means that the tower should comfortably be completed before 2030. This will be crucial because Riyadh has committed to completing projects worth hundreds of billions of dollars as part of Vision 2030, and this spending should help cushion Saudi Arabia’s economy from any storm clouds and headwinds that may be gathering elsewhere in the world.

https://image.digitalinsightresearch.in/uploads/NewsArticle/11180916/main.gif
Colin Foreman

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

Click here to register
Exclusive from Meed
Related Articles
  • UAE GDP projection corrects on conflict

    24 April 2026

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16554417/main.gif
    MEED Editorial
  • April 2026: Data drives regional projects

    24 April 2026

    Click here to download the PDF

    Includes: Commodity tracker | Top 10 global contractors | Brent spot price | Construction output

    MEED’s May 2026 report on the UAE includes:

    > COMMENT: Conflict tests UAE diversification
    > GVT &: ECONOMY: UAE economy absorbs multi-sector shock
    > BANKING: UAE banks ready to weather the storm
    > ATTACKS: UAE counts energy infrastructure costs
    > UPSTREAM: Adnoc builds long-term oil and gas production potential
    > DOWNSTREAM: Adnoc Gas to rally UAE downstream project spending
    > POWER: Large-scale IPPs drive UAE power market
    > WATER: UAE water investment broadens beyond desalination
    > CONSTRUCTION: War casts shadow over UAE construction boom
    > TRANSPORT: UAE rail momentum grows as trade routes face strain

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16553627/main.gif
    MEED Editorial
  • Firms announce 129MW Dubai data centre

    24 April 2026

    Dubai’s Integrated Economic Zones Authority (DIEZ) has signed a joint-venture agreement with Netherlands-headquartered data centre developer Volt to build a new artificial intelligence (AI)-ready data centre in the emirate.

    Planned for Dubai Silicon Oasis, the development will take the form of a campus covering up to 60,000 square metres.

    The project will be delivered in two phases, starting with 29MW of immediately available capacity, followed by a second phase adding a further 100MW of committed power.

    Under the arrangement, DIEZ will supply the land and essential infrastructure, while Volt will finance and develop the project, lead construction, and manage the design, leasing, implementation and day-to-day operations.

    French firm Schneider Electric, which has its regional headquarters in Dubai Silicon Oasis, will support the development by supplying advanced electrical systems, power distribution capabilities and smart data centre infrastructure.

    The GCC currently has more than 174 active data centre projects, representing over $93bn in investment, led by international players such as AWS, Google and Huawei, alongside regional developers including Khazna and Moro, supported by government-led localisation strategies.

    More than a dozen large-scale facilities valued at over $100m each are currently under tender, with further packages expected to reach the market over the next six to 12 months.

    The UAE is one of the leading data centre markets, with hyperscale campuses, sovereign cloud initiatives and edge data centre deployments underway.

    Data centre development is closely aligned with the UAE’s digital economy and AI roadmap, as well as the wider smart city programme.

    Priorities include hyperscale and colocation facilities to support cloud service providers; edge data centres to reduce latency and enable 5G and IoT use cases; energy-efficient designs using advanced cooling, modular construction and renewables; and strategic partnerships between global hyperscalers, local developers and utilities.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16548972/main.JPG
    Yasir Iqbal
  • Iraq signs upstream oil contract

    24 April 2026

    State-owned Iraqi Drilling Company (IDC) has signed a contract with China’s EBS Petroleum for a project to drill 17 horizontal wells in the southeastern portion of the East Baghdad field.

    Mohamed Hantoush, the general manager of IDC, said the contract signing came after a “series of successful achievements” by the company at the field.

    The achievements included the completion of a project to drill 27 horizontal wells and another project to drill 18 horizontal wells, according to a statement released by Iraq’s Ministry of Oil.

    In January, Iraq’s Midland Oil Company (MOC), in collaboration with EBS Petroleum, completed the country’s longest horizontal oil well in the southern part of the East Baghdad field.

    The well, which was called EBMK-8-1H, reached a total depth of 6,320 metres, and had a 3,535-metre horizontal section, making it the country’s largest horizontal well ever drilled.

    Senior officials from the Iraqi Oil Ministry and representatives of EBS Petroleum attended the well’s completion ceremony.

    EBS Petroleum is a subsidiary of China’s ZhenHua Oil, which is focused on Iraq.

    ZhenHua Oil is the operator of the field and is working with Iraqi partners to oversee the field’s development.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16543675/main4942.jpg
    Wil Crisp
  • Jordan tenders oil and gas terminal project

    24 April 2026

     

    Jordan’s Aqaba Development Corporation (ADC) has tendered a project for the development of the facilities at the Aqaba Oil and Gas Terminal.

    The project has been divided into two packages, and a bid deadline has been set for 15 June 2026.

    The oil and gas terminal is located south of the city of Aqaba in Jordan’s Southern Industrial Zone.

    The scope of Package 1 includes:

    • Rehabilitation of petroleum product pipelines of various sizes and their accessories (such as supports, structures and valves), including rectification of painting defects
    • Inspection and repair of pipe welds
    • Rectification and overall maintenance of the product booster pump
    • Inspection, maintenance, testing and commissioning of liquefied petroleum gas (LPG) booster pumps
    • Rectification of two overhead cranes
    • Rectification and calibration of instrumentation, including pressure indicators and valves

    The scope of Package 2 includes:

    • Rehabilitation of control rooms and security rooms, replacing them with concrete control rooms, including infrastructure works and all required services
    • Removal of unused tanks and equipment previously used for exporting crude oil
    • Rehabilitation of the existing gate in order to improve safety and security with the installation of a tire killer
    • Carrying out maintenance and repairs for the oil berth dolphins and trestle with inspection
    • Maintenance, repair and reinstallation of oil berth concrete slabs
    • Removal and extension of the jetty platform
    • Installation of a lighting system at pipelines beside booster pumps
    • Installation of stripping pumps at the LPG terminal
    • Replacement of drain line path for slop tank of LPG booster pumps
    • Rehabilitation of the existing closed drain drum
    • Rectification of cone sealing issue of all truck loading arms
    • Conversion of manual valves to motor-operated valves
    • Remote operation of shut-off valves on the main pipeline alongside and near the entrance gate
    • Upgrading of the firefighting system

    The last date for questions and clarifications related to the project will be 13 May 2026.

    The Aquaba Oil and Gas Terminal was built to meet demand for petroleum products and LPG imports into Jordan.

    It is operated by state-owned Jordan Oil Terminals Company (JOTC), which was established in 2015 as a private shareholding company.

    Earlier this year, Abu Dhabi’s AD Ports Group signed an agreement with ADC to manage and operate the Aqaba multipurpose port.

    AD Ports is managing and operating the port under a 30-year concession agreement.

    Under the agreement, AD Ports and ADC will establish a joint venture to oversee port operations.

    AD Ports will hold a 70% stake in the joint venture, with the remaining 30% held by ADC.

    AD Ports Group will also invest AED141m ($38.4m) in the joint venture.

    The signing ceremony was held at the Aqaba Special Economic Zone Authority headquarters in Aqaba on 5 February.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16543632/main.jpg
    Wil Crisp