meed-logo

line1 line2 line3
SIGN IN / REGISTER

Cooperation strengthens Gulf markets

21 November 2024

 

The message was loud and clear at the second Gateway Gulf investment forum hosted by the Bahrain Economic Development Board (Bahrain EDB) in Manama in early November. Regional integration will be crucial to the GCC’s ongoing economic success story.

The comments by ministerial speakers and business leaders at the event underscored how the GCC has grown closer both politically and economically since the signing of the Al-Ula declaration in 2021, which effectively ended the Qatar diplomatic dispute that began in 2017, and kickstarted a new era of regional cooperation. 

The drive to bind the GCC as a more integrated economic bloc contrasts sharply with the political backdrop of the first Gateway Gulf. That event in May 2018 started the day President Donald Trump withdrew the US from the Joint Cooperative Plan of Action, better known as the Iran nuclear deal, and was set amid the GCC’s diplomatic dispute with Qatar.

Closer ties

The political backdrop is very different in 2024; the six GCC states enjoy warm relations, and tensions with Iran have cooled following a series of diplomatic rapprochements involving Tehran, Riyadh and Abu Dhabi. 

These diplomatic efforts have resulted in a more stable business environment that has produced robust economic growth, record levels of inward investment and record spending on projects. 

“As with every great moment in history, our region’s progress depends on continued unity and collaboration with current geopolitical complexities. A unified GCC can serve as a stabilising force shaping not only our own future but influencing the future,” said Bahrain’s Finance & National Economy Minister, Sheikh Salman Bin Khalifa Al-Khalifa, during his opening address at Gateway Gulf. 

The stability that the Gulf offers has enhanced its appeal to investors at a time of war and instability in other areas. 

“We have become one of the most promising destinations, not only for those looking to raise capital, but also for those looking to deploy it,” said Sheikh Salman. “Dynamic transformation is sweeping across the region.”

Saudi Arabia’s Investment Minister Khalid Al-Falih also highlighted how the GCC has managed to prosper while other regions struggle with challenges. “GCC countries come out of these tensions stronger. We know how to navigate unfortunate difficulties. We’ve seen it over many, many decades … and if you look at the numbers, our credit ratings are going up, our stock markets are strong, unemployment is coming down across the region,” he said.

Regional integration will be crucial to the GCC’s ongoing economic success story

Attracting investment

Investment funds also play a key role in the region’s success. “The GCC also has [Saudi Arabia’s Public Investment Fund] the PIF and the Emirati, Qatari and Kuwaiti funds that are all well-capitalised sovereign funds that can co-invest with global investors,” said Al-Falih. 

Over the past year, some of the world’s leading investment companies have formed joint ventures with the GCC’s sovereign wealth funds. 

In November, US-based Apollo and Abu Dhabi’s Mubadala Investment Company extended their multibillion-dollar partnership, initially formed in 2022, to capitalise on global private debt and equity opportunities. This extension enhances Apollo’s Capital Solutions division, supporting large-scale investment origination to meet rising demand for private financing. 

The partnership aligns with Apollo’s goal to reach $275bn in annual originations, with a focus on sectors like clean energy and digital infrastructure.

In April 2024, BlackRock and the PIF agreed to establish BlackRock Riyadh Investment Management, a multi-asset investment firm based in Riyadh. The venture began with an anchor investment of up to $5bn from the PIF, aiming to accelerate the growth of Saudi Arabia’s capital markets by supporting foreign institutional investment.

Al-Falih also highlighted changes in how sovereign wealth funds that traditionally used to invest overseas to offset volatility in the oil markets are increasingly looking to domestic investment within the GCC. 

“We are investing globally, but quite frankly, when we look around the world, we can’t find a better location to invest than within the region and in our own economies, which are transitioning,” he said. 

Sheikh Salman echoed Al-Falih’s comments. “I chair Mumtalakat, [Bahrain’s] sovereign wealth fund, and we look at where we deploy capital. What we have found is that the most compelling investment opportunities, with the highest return on equity, are increasingly at home or in the region. 

“Mumtalakat has in effect turned itself into the joint venture partner of choice for inward investment because it provides a higher return on equity versus other investments in other places,” he said.

Many of those investments have involved infrastructure, with notable transactions in oil infrastructure, the power and water sector and real estate. 

An example came in September, when Bahrain’s state-owned Bapco Energies sold a stake in the Saudi Bahrain Pipeline Company (SBPC) to a fund managed by BlackRock. SBPC owns a portion of the 112-kilometre pipeline supplying crude oil from Saudi Aramco to Bahrain’s Sitra refinery.


Sheikh Salman and Saudi Investment Minister Khalid Al-Falih met at Gateway Gulf 2024. Credit: Bahrain News Agency

Another emerging trend could be cross-border mergers and acquisitions across the GCC. Over the past decade, there has been a steady stream of consolidation as companies combine their operations. This has remained within national borders and typically involved government or government-related entities. 

Abu Dhabi, in particular, has been a hotbed for consolidation involving companies in a variety of sectors, including banking, hydrocarbons, industry, real estate and construction. 

The new trend is for companies to merge with other players outside their national boundaries, but within the GCC. Also at Gateway Gulf, Aluminium Bahrain (Alba) chairman Khalid Al-Rumaihi provided an update and insight into the proposed merger of Alba with the aluminium business of Saudi Arabian Mining Company (Maaden). 

The pioneering transaction could pave the way for further consolidation across the region. Al-Rumaihi emphasised that private sector deals need to make business sense when asked about the impact of the deal on future transactions. 

“When we talk about integration in the GCC, the private sector should lead, and we hope that others will look at this [transaction] and explore opportunities. It could happen in banking, it could happen in other industries, but I think it could accelerate, and it needs the transaction to make sense,” he said.

The GCC’s projected growth will provide plenty of opportunities for everyone

Promoting collaboration

As cooperation across the GCC intensifies, seasoned Gulf watchers will be reminded that the region has been through periods of accelerated integration, only to have those efforts dashed due to internal disputes and greater protectionism introduced during economic downturns. The most cited historical example is the single currency project pursued in the early 2000s, which was reportedly aborted after governments could not decide where to locate the GCC Central Bank.

At the same time, other regional projects, such as the GCC rail scheme, had failed to make substantial progress.   

Speaking at Gateway Gulf, Bahrain’s Industry & Commerce Minister Abdulla Bin Adel Fakhro said that the GCC has evolved. He explained that in the past, the GCC countries produced oil and exported it out of the region, which gave little economic incentive for cooperation. Today, economies are more diversified and trade with one another enhances cross-border collaboration.  

Collaboration is already visible in the projects market. There are schemes to connect the electricity grids of the UAE with Saudi Arabia and Oman, and the once dormant GCC rail project is advancing, with progress being made on rail projects in all six GCC states. 

Growth also supports integration. Sheikh Salman said that the GCC’s projected growth will provide plenty of opportunities for everyone. 

“The GDP of the Gulf countries is approximately $2.3tn. Over 50% of that is in Saudi Arabia and over 25% is in the UAE. That $2.3tn is conservatively going to reach $3tn of GDP by 2030 and $6tn of GDP by 2050,” said Sheikh Salman. 

“That in and of itself is the single biggest opportunity for any other GCC country – to ensure that they are providing the services, providing the growth engine, providing any sort of services to [support] that growth.”

On a similar note, Al-Falih explained that what is good for one GCC country will ultimately benefit all. “If it is good for Bahrain, it is good for Saudi Arabia, and what is good for Saudi Arabia is good for the rest of the GCC. It is the old adage that a rising tide lifts all boats.” 

https://image.digitalinsightresearch.in/uploads/NewsArticle/12965411/main.gif
Colin Foreman

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

Click here to register
Exclusive from Meed
Related Articles
  • Neom’s industrial pivot gathers pace

    1 October 2026

    Commentary
    Colin Foreman
    Editor

    Reprioritisation has been the buzzword in Saudi Arabia over the past two years and nowhere has that been more evident than at Neom. 

    The slowdown of development at The Line and the postponement of the 2029 Asian Winter Games at Trojena have dominated international headlines. As these projects scale back, Oxagon’s industrial and logistics base has become the $500bn gigaproject’s flagship development. There are tangible results: in August, the $8.5bn Neom Green Hydrogen project was commissioned, marking Neom’s most significant completion to date. 

    Construction activity elsewhere at Oxagon supports this trend. The AI data-centre campus being developed by Humain and DataVolt has broken ground on its first 100MW phase, backed by $5bn of investment and targeted for service in 2028. Neom has issued an expression of interest for a rail line linking the Port of Neom to Saudi Arabia Railways’ North-South network, tenders are out for an industrial wastewater plant and the upgrade of Highway 55, and the port itself is advancing towards a 2030 capacity target of 1.5 million TEUs. 

    The regional conflict that began in February has strengthened the business case by giving Oxagon’s Red Sea port added strategic weight as a second maritime gateway outside the Strait of Hormuz, at a time when Riyadh has committed to directing about 80% of the Public Investment Fund’s portfolio into domestic investment.

    These developments reflect a kingdom recalibrating rather than retreating

    Elsewhere, Saudi Arabia’s wider projects market is holding steady despite conflict-related disruption, with contract awards reaching $68bn so far this year. The regional power market is also diversifying, with Aljomaih, EDF and Kepco all more than tripling net capacity in recent years as Acwa retains its lead.

    These developments reflect a kingdom recalibrating rather than retreating, with priority given to projects capable of delivering commercial returns.

    READ THE OCTOBER 2026 MEED BUSINESS REVIEW – click here to view PDF

    Industry and logistics drive development at Neom; Saudi Arabia’s investment priorities realign amid conflict; MEED’s 2026 power developer ranking.

    Distributed to senior decision-makers in the region and around the world, the October 2026 edition of MEED Business Review includes:
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/20178338/main.gif
    Colin Foreman
  • Contractor wins Dammam airport water infrastructure deal

    1 October 2026

    Saudi Arabia-based Alkhorayef Water & Power Technologies has won an SR80m ($21.3m) contract to rehabilitate water and wastewater infrastructure at King Fahd International airport in Dammam in the kingdom’s Eastern Province.

    The contract was awarded by Dammam Airports Company (DACO), and work is scheduled to be completed within 18 months, the firm said in a disclosure to the Saudi Exchange (Tadawul) on 29 September.

    The scope covers the design, construction, supply, installation, replacement, rehabilitation and integration of water and wastewater infrastructure.

    It includes pumps, storage tanks and reservoirs, reverse osmosis facilities, piping and tie-ins, as well as electrical and instrumentation works.

    The award comes as DACO advances a wider programme of investment at King Fahd International airport.

    DACO signed more than SR1.2bn ($320m) in agreements in June covering airport infrastructure, including a new power station, a medium-voltage distribution network and upgrades to the existing electrical grid. 

    In September, it also appointed WSP Middle East, the regional arm of Canadian engineering firm WSP, to develop the airport’s expansion under its masterplan.

    The expansion is intended to increase annual passenger capacity to more than 19.3 million by 2030, with a longer-term target of 32 million passengers. 

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20169118/main.jpg
    Mark Dowdall
  • Kuwait tenders LNG project

    1 October 2026

     

    State-owned Kuwait Integrated Petroleum Industries Company (Kipic) has tendered a project to develop a reliquefaction unit at the Al-Zour liquefied natural gas (LNG) import terminal.

    The project focuses on developing a boil-off gas (BOG) unit at the terminal, with bids due on 22 December.

    A meeting for contractors to discuss the project is scheduled for 18 October.

    The project scope includes engineering, procurement and construction works, along with pre-commissioning, commissioning and performance testing services.

    The list of prequalified companies is:

    • Fluor (US)
    • GS Engineering & Construction (South Korea)
    • Tecnicas Reunidas (Spain)
    • Larsen & Toubro (India)
    • Hyundai Engineering (South Korea)
    • CTCI Corporation (Taiwan)
    • Daewoo Engineering & Construction (South Korea)
    • Hyundai Engineering & Construction (South Korea)
    • Saipem (Italy)
    • Samsung Engineering (South Korea)
    • Sinopec Engineering (China)
    • JGC Holdings (Japan)
    • KBR (US)
    • China National Petroleum Corporation (China)
    • Technip (France)

    A BOG unit at an LNG facility captures, compresses and processes natural gas vapours that evaporate from cryogenic storage tanks, enabling the gas to be recycled back into the system rather than flared.

    In April, MEED revealed that contractors expected the project to be worth about $200m.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20168625/main2005.jpg
    Wil Crisp
  • Riyadh approaches contractors for 2km tower

    1 October 2026

     

    Register for MEED’s 14-day trial access 

    Saudi Arabia’s Public Investment Fund (PIF) has reached out to contractors as part of a market-sounding exercise for the construction of the proposed 2-kilometre megatall tower project.

    MEED understands that a PIF subsidiary, the Tower District Real Estate Development Company, is undertaking the process.

    It is understood that several experienced international contractors, as well as some prominent local contractors, have been approached.

    The latest development follows PIF receiving offers in June last year from firms seeking a contract to provide project management consultancy (PMC) services for a new central business district (CBD) on the outskirts of Riyadh, which includes the proposed 2km tower.

    The PMC role covers both the tower and the surrounding district.

    Firms understood to have been invited to bid include US-based Aecom, Jacobs, Parsons and Turner, as well as the UK’s Mace.

    UK-based Foster & Partners is working as the architect for the tower after winning a design competition launched in late 2022.

    Record breaker

    The proposed tower would be more than double the height of the world’s tallest building, Dubai’s Burj Khalifa, which stands 828 metres tall. It is expected to be at least several hundred metres taller than the 1,000-metre-plus tower under construction in Jeddah.

    Contractors that have priced megatall towers in the region say a 2km-tall structure could cost about $5bn to construct, depending on the final design.

    The 2km tower and the surrounding CBD – known as Project Rise – sit within a larger masterplanned development to the north of Riyadh called the North Pole.

    MEED’s October 2026 report on Saudi Arabia includes:

    > COMMENT: Saudi projects hold steady
    > GOVERNMENT: Riyadh looks to reset its regional defence outlook
    > ECONOMY: Conflict bolsters case for Saudi economic diversification
    > BANKING: Saudi lenders readjust to lower lending and deposit climate
    > UPSTREAM: Aramco upstream spending gathers pace
    > DOWNSTREAM: Sabic steps up Saudi petchems investment
    > POWER: Saudi Arabia’s power award activity slows
    > WATER: Saudi water sector hits sharp slowdown
    > CONSTRUCTION: Saudi construction defies the headwinds
    > TRANSPORT: Saudi infrastructure pushes forward amid conflict
    > DATABANK: Saudi data indicates project spending shift

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/20156496/main.jpg
    Yasir Iqbal
  • Singapore’s Temasek plans Middle East expansion

    1 October 2026

    Singapore’s Temasek plans to open offices in Riyadh and Abu Dhabi early next year as it targets investment and partnership opportunities in Saudi Arabia, the UAE, Qatar and the wider region.

    The state-owned investor had a net portfolio value of S$518bn ($401bn) as of 31 March 2026.

    It said the new offices will serve as regional hubs for Temasek and its portfolio companies, with some businesses expected to co-locate to work more closely with partners and pursue deals alongside the group. The openings are subject to regulatory approvals.

    Temasek said it will also step up engagement with institutions in Qatar, although it has not announced plans to establish an office there.

    The company said the expansion reflects its confidence in the region’s long-term fundamentals and the economic transformation being driven by national diversification programmes.

    It added that a presence in Riyadh and Abu Dhabi will also support investment activity beyond the region by improving access to opportunities across the wider Middle East, Central Asia and Africa.

    Several Temasek-owned or Temasek-backed companies are already active in the GCC, providing a platform for the group’s planned expansion.

    These include Singapore-headquartered engineering and consultancy firm Surbana Jurong, which has been involved in masterplanning and advisory work on major regional developments, alongside other portfolio companies with interests spanning infrastructure, logistics, financial services and technology.

    According to data from regional project tracker MEED Projects, Surbana Jurong is involved in several major projects in Saudi Arabia, including King Abdulaziz International airport (KAIA) in Jeddah, Jeddah Islamic Port, Red Sea Global’s Amaala masterplan, the Trojena dams scheme, Oxagon, King Salman International airport and Saudi Arabia Railway’s North-South Phosphate Railway 3.

    The firm has also worked on projects in the wider region, including the West Link project, Urban Loop, Musaffah Innovation District masterplan, Etihad Rail’s high-speed rail programme and Abu Dhabi airport’s Midfield Terminal.

    Surbana Jurong has also secured masterplanning contracts from Abu Dhabi’s Department of Municipalities & Transport and Abu Dhabi Ports.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/20157511/main.jpg
    Yasir Iqbal