Big construction plans offer hope to Maghreb market

10 July 2023

This package on the Maghreb also includes:

Morocco plans six stadium projects for 2030 World Cup
Libya has potential for energy project surge
Security company licensing system overhauled in Libya
US firm plans 2MW Morocco hydrogen project
Italy and Tunisia start $1bn Elmed prequalifications

 


Based on the total value of work under execution, the Maghreb region remains an active market for construction companies. 

According to regional projects tracker MEED Projects, there are $33bn of construction and transport projects at the execution stage in the Maghreb.

Algeria and Morocco are the two most active markets with $19.6bn and $10bn of projects under execution, respectively.

Libya and Tunisia have about $1.4bn of projects under execution each. 

The challenge is that many of these projects are long-standing ones, with the average duration of ongoing projects exceeding four-and-a-half years. 

At the same time, the value of new project awards remains subdued. Over the past year, there have been $1.2bn of construction and transport awards across the four countries. 

During that period, there have only been two contract awards with a value exceeding $100m in the Maghreb region.

The largest is a $403m contract to build a 36.5-kilometre-long stretch of highway in Morocco; the other is a $330m deal to expand a port in Algeria. 

A joint venture of Mojazine Groupe and NGE Contracting, Entreprise Houar, secured the Moroccan road scheme. The Ministry of Equipment, Transport, Logistics & Water project involves constructing a highway connecting Guercif to Saka as part of Morocco’s Guercif-Nador motorway project.

China Harbour Engineering Company secured the $330m Algerian contract to expand Arzew port. 

Morocco opportunities

With few significant projects awarded over the past year, construction companies are looking to the future for new opportunities. 

Morocco’s prospects for major construction projects appear the most promising, driven by two significant developments: the Spain-Morocco tunnel project and the potential hosting of the 2030 World Cup. 

In June, Spain approved funding for the Spanish Society for Fixed Communication across the Strait of Gibraltar (Secegsa) to conduct a design study for a tunnel link under the Mediterranean. Planned since 1980, the proposed railway tunnel is 38.7km long and will undoubtedly require the involvement of major international construction companies. 

For the World Cup, King Mohammed VI announced Morocco’s plans to join Spain and Portugal’s bid to host the 2030 tournament in March. To facilitate hosting the event, Morocco plans to build a 93,000-seat stadium in Casablanca and upgrade at least five existing stadiums.

The estimated MD2bn ($200m) stadium planned for Casablanca will be built on the outskirts of the city. It will be developed with the involvement of the Ministry of National Education, Preschool & Sports, the Royal Moroccan Football Federation and the local municipalities.

The five stadiums to be upgraded are the Prince Moulay Abdallah stadium in Rabat, the Ibn Battuta stadium in Tangier, and stadiums in Fez, Agadir and Marrakesh. A stadium in Tetouan may also be upgraded.

Algeria rail

In Algeria, the future pipeline of projects is dominated by railway schemes. At the end of 2022, Algeria’s National Agency for the Engineering & Monitoring of the Achievement of Railway Investments (Anesrif) invited national and international companies to express interest in working on its multibillion-dollar rail-building programme. It involves the development of lines that, when complete, will total more than 12,000km in length.

Tunisia viaduct

In Tunisia, the opportunities are more limited. One project that has attracted interest from international construction companies is the design and build of a 2.1km viaduct linking Tunis and Bizerte.

At the end of last year, the Equipment, Housing & Infrastructure Ministry prequalified firms including players from China, France, Turkey, Egypt, Italy and Japan for the estimated $250m scheme. The project is expected to be tendered this year. 

The scheme, which is cofinanced by the European Investment Bank and African Development Bank, is split into three sections. The south liaison road, which comprises lot one, includes three interchanges. The main viaduct forms lot two, and the north liaison road, lot three, will feature one interchange.

Longer term, foreign investors may play a leading role in the market. One such investor is the UAE’s Bukhatir Group, which plans to revive a $5bn sports-focused development in northern Tunis. In its first phase, it will include the construction of luxury villas and a golf course.

Libya highway

For Libya, there are high hopes that the market will soon put a decade-long conflict behind it. Over the past year, various moves have indicated that new projects may now be starting to progress.

The most significant of these came at the end of 2022 when it was reported that the Italian government had begun the tendering process for the coastal highway linking the east and west of Libya from Misrata to Ras Jedir, on the border with Tunisia.

For the Maghreb to become a dynamic construction market, the plans for projects in Morocco, Algeria, Tunisia and Libya will need to start moving ahead in 2023 and 2024. If not, the market will remain subdued. 

https://image.digitalinsightresearch.in/uploads/NewsArticle/10994933/main.gif
Colin Foreman
Related Articles
  • Samsung C&T and Trojan wins Abu Dhabi gas fired power plant Jennifer Aguinaldo

    7 April 2025

    A joint venture of South Korea's Samsung C&T and the local Trojan has won the engineering, procurement and construction (EPC) contract for the project to build an open-cycle gas turbine (OCGT) power generation plant in Abu Dhabi's Al-Dhafra region.

    The Al-Dhafra OCGT project will have a capacity of 1,000MW.

    Abu Dhabi National Energy Company (Taqa) will own 100% of the project and undertake the operation and maintenance (O&M) of the plant.

    The build, own and operate (BOO) contract is estimated to require an investment of roughly $1.35bn.

    Taqa signed a 24-year power-purchase agreement with the state utility and offtaker Emirates Water & Electricty Company (Ewec) for the project on 3 April.

    MEED previously reported that Italy's Ansaldo Energia will supply gas turbines for the project.

    Ewec is working with both Taqa and Abu Dhabi Future Energy Company (Masdar) to implement the power plant projects that will support the UAE government’s artificial intelligence strategy.

    In January, Ewec and Masdar announced a project to build a solar photovoltaic (PV) and battery energy storage system (bess) project that will enable the round-the-clock supply of 1GW of solar power. It will comprise a 5GW solar PV plant and 19 gigawatt-hour bess plant.

    In addition to the round-the-clock and Dhafra OCT plants, Taqa has also allocated over $2bn for advanced grid infrastructure projects to support the UAE capital's AI strategy.

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13632998/main.gif
    Jennifer Aguinaldo
  • Oman plans major water investments Jennifer Aguinaldo

    7 April 2025

    Oman intends to allocate major investments in water treatment, reuse and distribution network over the coming years,  Qais bin Saud Al-Zakwani, CEO of Nama Water Services, told the ongoing Oman Water Week in Muscat.

    "We are allocating major investments for water irrigation, sewage treatment and network …and to enable small and medium enterprises (SMEs) to participate in the development of infrastructure projects," Al-Zakwani said.

    The executive added that the sultanate is working to develop alternative water sources, including developing deep water dams and water desalination plants as part of efforts to reuse and renew water resources to support the agriculture and industrial sectors in Oman.

    "Nama will use the most advanced technologies to limit water exploitation, use drones and other advanced water technologies to monitor water leakages… and to rationalise water usage," the executive noted.

    "We are attaching great importance to the water sector to achieve sustainability, … and cooperation between all countries and organisations will be essential."

    In late March, Nama Water Services awarded a contract to develop a water treatment plant in Oman's Wadi Dayqah, as MEED reported.

    Al-Tayer Engineering Services Company won the RO55m ($143m) contract for the 20-year build, own and operate contract.

    The construction of the plant and associated infrastructure is expected to take 22 months.

    The facility will boast a total production capacity of 65,000 cubic metres a day (cm/d), with 35,000 cm/d channelled into Nama Water Services’ main distribution network, supplying potable water.

    The remaining 30,000 cm/d will be dedicated to agricultural irrigation, distributed through a network serving farms in the Wilayat of Qurayyat, in coordination with the Ministry of Agriculture, Fisheries & Water Resources.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13632710/main.jpg
    Jennifer Aguinaldo
  • Tunnel vision guides region Colin Foreman

    7 April 2025

    Commentary
    Colin Foreman
    Editor

    Read the April MEED Business Review

    Gulf cities are buzzing with economic growth. Populations are growing, real estate values are rising and project activity is ramping up as developers launch real estate projects.

    From a construction point of view, economic success is best represented by the high-rise towers stretching across the skylines that now define the region’s modern urban identity. While towers continue to be developed, how Gulf cities perform in the future will depend more on what is built below the ground rather than above it.

    As buildings have become taller, population densities have increased, putting huge pressure on infrastructure networks. This is most apparent on the roads, with cities blighted by crippling traffic in peak periods.

    More investment in infrastructure is needed to overcome this challenge, and crucially, with space on the surface limited, the solution is to build more roads and utilities networks underground. This has been done before with projects such as the metros in Dubai, Doha and Riyadh, and the deep gravity sewerage network built in Abu Dhabi, and in each case, the projects have demonstrated the value of building heavy civil infrastructure underground.

    Emboldened by these successes, the region is working on a new generation of tunnelling projects. Dubai’s proposed Loop system, backed by Elon Musk’s Boring Company, is one of the highest-profile examples of this trend. Others include projects such as the Riyadh Metro Line 7, the Blue and Gold lines for Dubai Metro, along with ongoing metro projects in Cairo.

    The momentum in the Middle East comes amid growing pressure on global investment in tunnelling due to economic headwinds, inflation and geopolitical tensions.

    Although the Middle East is not immune to global trends, its growing cities, combined with the means and the desire for them to become the world’s best cities in the future, will mean that the region will remain a bright spot for tunnelling for the foreseeable future.


    READ THE APRIL 2025 MEED BUSINESS REVIEW – clck here to view PDF

    Regional construction heads underground; Riyadh reaps both diplomatic and economic success; Luxury GCC hospitality projects drive tourism

    Distributed to senior decision-makers in the region and around the world, the April 2025 edition of MEED Business Review includes:

    > SAUDI ARABIA REPORT: Riyadh enjoys buoyant fortunes
    > GULF PROJECTS INDEX: Gulf index sees minor correction
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/13619034/main.gif
    Colin Foreman
  • Oman receives Misfah and Duqm applications Jennifer Aguinaldo

    4 April 2025

    Oman’s Nama Power & Water Procurement Company (Nama PWP) has received statements of qualifications (SoQs) from 12 firms for a competitive tender to develop a gas-fired independent power producer (IPP) project in the sultanate.

    The Misfah and Duqm combined-cycle gas turbine plants will have a capacity of 2,400MW and will be tendered as one contract, a source close to the project previously told MEED. 

    Nama PWP invited interested firms to submit their prequalification applications for the project in January, with a deadline of 13 March.

    The utility developers that submitted their SoQs include:

    • Acwa Power (Saudi Arabia)
    • Korea Western Power Company (Kowepo, South Korea)
    • Marubeni Corporation (Japan)
    • Nebras Power (Qatar)
    • Alghanim International (Kuwait)
    • Etihad Water & Electricity (UAE)
    • Reliance Power (India)
    • Samsung C&T Corporation (South Korea)
    • Sembcorp Utilities (Singapore)
    • Shenzhen Energy Group Company (China)
    • Sumitomo Corporation (Japan)
    • Al-Jomaih Energy & Water (Saudi Arabia)

    In December, the project client invited companies to express interest in the project, which will be implemented on a build, own and operate (BOO) basis.

    At the time, Nama PWP said it expected to issue the tender in the first quarter of 2025 and award the BOO contract by Q4.

    The company also said it expects early power in Q2 2028 and full commercial operation in Q2 2029.

    US/India-based Synergy Consulting is the client’s financial adviser.

    The new project represents a u-turn on a previous announcement that Oman would not build any new gas-fired power generation plants, which local media reported in 2022.

    In May last year, Nama PWP announced the award of renewed contracts for four gas-fired independent power and water projects (IWPPs) in the sultanate.

    The agreements collectively secured over 1,500MW of electricity and 200,000 cubic metres a day of desalinated water for up to nine years.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13616470/main.jpg
    Jennifer Aguinaldo
  • Trump tariffs hit 13 Mena states Jennifer Aguinaldo

    4 April 2025

    Over a dozen Middle East and North Africa (Mena) countries will face US President Donald Trump's reciprocal tariffs – at rates varying between 10% and 41% – from 5 April.

    Trump announced an executive order on 2 April regarding “regulating imports with a reciprocal tariff to rectify trade practices that contribute to large and persistent annual US goods trade deficits”.

    Six of these countries – Egypt, Kuwait, Morocco, Qatar, Saudi Arabia and the UAE – face 10% tariffs, which is the minimum rate, or universal tariff, imposed on US trading partners.

    Goods from Syria and Iraq face the highest tariff rates of 41% and 39%, followed by Libya and Algeria, which each face tariffs of 31% and 30%, respectively.

    The executive order imposes 28% tariffs on goods originating from Tunisia, 20% from Jordan and 17% from Israel.

    The impact of the new tariffs on regional businesses is less clear compared to their effect on US consumers, who will have to bear the brunt of increased prices of imported products.

    US media outlets report that goods included in the reciprocal tariff regime include electronics, automobiles, clothing and shoes, wine and spirits, furniture, coffee and chocolates.

    Dubai-based global ports operator DP World said that businesses will face significant adjustments in response to the tariffs, according to a report by the UAE’s The National.

    “With tariffs increasingly shaping policy, we recognise that businesses are facing significant adjustments. As supply chains realign, new manufacturing and trading hubs may emerge in response to shifting cost structures and market access considerations,” DP World said.

    The firm added that it is working closely “with our customers to navigate these complexities – helping them maintain continuity, find efficiencies and build resilience in an evolving global landscape”.

    Photo credit: Pixabay, for illustrative purposes only

    https://image.digitalinsightresearch.in/uploads/NewsArticle/13616433/main.jpg
    Jennifer Aguinaldo