meed-logo

line1 line2 line3
SIGN IN / REGISTER

Earthquake rebuild to impact Turkish interest in Saudi

2 March 2023

The Kahramanmaras earthquakes that struck Turkiye and northern Syria on 6 February have left more than 44,300 people dead and another 1.5 million homeless.

The disaster could also impact Turkish contractors’ appetite for work on projects in Saudi Arabia as their domestic market focuses on the $70bn reconstruction effort.

Over the past year, Turkish contractors have had increasing appetite to take on large volumes of the construction work that Saudi Arabia plans to complete as part of Vision 2030. Some $569bn-worth of contracts could be awarded between 2021 and 2025, according to MEED’s Saudi Gigaprojects report.

The expectation stems from the fact that Turkish contractors have traditionally played an active role in the Middle East on projects such as the Kuwait, Doha and Abu Dhabi airports, the Haramain railway in Saudi Arabia and Dubai Metro. According to regional projects tracker MEED Projects, Mapa, Yapi Merkezi, Yuksel and Tekfen have been the most active Turkish contractors in Saudi Arabia.

Turkish contractors were unofficially blacklisted in Saudi Arabia for political reasons in recent years. In 2020 and 2021, no contracts were awarded to Turkish firms. The annual total had averaged $1.3bn for the 10 years before 2018, with a peak of $2.3bn of awards in 2011, according to MEED Projects.

The embargo ended last year, and since then, Turkish contractors have been making a comeback in the kingdom. 

Over the past six months, several major construction contracts have been awarded to Turkish contractors. The first major award to a Turkish contractor came in August 2022 when Saudi Baytur secured a contract from Umm al-Qura for Development & Construction Company (Umm al-Qura) to build part of its Masar mixed-use development in Mecca.

The number and total value of contracts awarded to Turkish contractors had been forecast to grow as more projects move into the construction phase. However, those expectations may have to be revised due to the scale of the damage caused by the earthquakes.

The extent of the reconstruction effort required is only just being quantified. According to a report published by the World Bank on 20 February, direct damages from the earthquakes are estimated at $34.2bn, equivalent to 4 per cent of Türkiye’s 2021 GDP.

The report adds that based on global experience, recovery and reconstruction costs will be much larger, potentially twice as large, which puts the price at close to $70bn.

Market reversal

The expected spike in construction work will reverse a market that is in decline. According to GlobalData’s Construction in Turkey – Key Trends and Opportunities to 2026, published in December last year before the earthquake, the Turkish construction industry was expected to decline by 9.9 per cent in 2022 and 3 per cent in 2023, owing to weaknesses in the general economy amid the ongoing lira crisis and disruption stemming from the Russia-Ukraine conflict. According to GlobalData, Turkiye’s most active local contractors are Limak, Kolin, Dogus and Yapi Merkezi.

Industry figures in Turkiye do not expect the earthquake rebuilding programme to affect the appetite of these internationally active contractors for work in Saudi Arabia.

“There are two groups of contractors in Turkiye,” says an industry leader. “There are companies that work internationally, and there are others that are purely domestic. There are many mid-sized contracting companies that only work in Turkiye that are going to be involved with the rebuilding efforts.”

But even if the internationally focused contractors are still keen for work in Saudi Arabia, their ability to execute projects cost-effectively may be challenged as the earthquake rebuild programme increases the overall demand for people, materials and equipment.

There are already signs that Turkish resources will be redeployed to Turkiye from the GCC.

“There are people looking to source equipment in Qatar and send it to Turkiye to help with the reconstruction efforts,” says a Turkish contractor working in the GCC.

Companies focusing their expertise on national rebuilding efforts is nothing new. In 2011, when the Tohoku earthquake and tsunami damaged large parts of northeastern Japan, many Japanese construction companies working internationally and in the Middle East concentrated on rebuilding Japan. The construction work required for the 2020 Tokyo Olympics then meant many Japanese contractors did not return to the Middle East region.

Japan is different to Turkey. Japan is further away from the Middle East, its construction sector is widely regarded as lucrative with healthy margins, and its economy was less fragile. These things combined should mean Turkish interest in Saudi projects remains strong.

The more subtle question is how hungry for work contractors will be if there are more opportunities to work at home, and secondly, how cost-effective they will be if the demand for resources increases sharply.

Image: Hatay, Iskenderun, Turkey – 6 February 2023

https://image.digitalinsightresearch.in/uploads/NewsArticle/10640199/main.gif
Colin Foreman

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

Click here to register
Exclusive from Meed
Related Articles
  • Nakheel awards $143m Dubai Islands infrastructure deal

    20 April 2026

    Register for MEED’s 14-day trial access 

    Dubai-based developer Nakheel, now part of Dubai Holding, has awarded a AED527m ($143m) contract for the construction of the primary infrastructure and utilities works on Island B at the Dubai Islands development.

    The contract was awarded to local firm Al-Nasr Contracting Company.

    The scope covers the construction of roads, water networks, electrical and telecommunications networks, drainage and sewerage systems, and integration with the district cooling plant network at Island A.

    In October last year, Nakheel awarded Al-Nasr Contracting Company a AED169m ($46m) contract for the construction of the internal roads and utilities for the Bay Villas development at Dubai Islands.

    In August, MEED reported that Nakheel had awarded a AED2.6bn ($708m) contract to Abu Dhabi-based Fibrex Contracting to build the Bay Villas project at Dubai Islands. The contract includes the construction of 636 villas.

    The Dubai Islands development consists of five islands spanning 18.6 square kilometres. It features more than 59 kilometres (km) of waterfront and 20km of beaches, as well as parks, golf courses, promenades and cycling paths.

    The offshore island project gained renewed momentum in 2022, when Nakheel unveiled a new masterplan and rebranded it as Dubai Islands.

    The reclaimed islands were originally part of the Palm Deira project, which was partially completed before being put on hold in 2008.

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

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

    Distributed to senior decision-makers in the region and around the world, the April 2026 edition of MEED Business Review includes:

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here

     

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16476987/main.jpg
    Yasir Iqbal
  • Borouge International appoints chief financial officer

    20 April 2026

    Newly formed chemicals giant Borouge Group International AG (Borouge International) has appointed Patrick Jany as chief financial officer (CFO). He will take office from 1 May, until which time Daniel Turnheim will continue to serve as interim CFO.

    Jany joins Borouge International with more than three decades of international finance leadership across industrial, logistics and chemical businesses. “With 20 years’ CFO experience in publicly listed companies, he brings deep financial expertise and a disciplined approach to capital management,” Borouge International said in a statement.

    Most recently, Jany served as executive vice-president and CFO of Danish shipping company A P Moller-Maersk, where he joined the executive board in 2020 and played a central role in strengthening financial discipline, portfolio management and value creation during a period of major strategic transformation.

    Prior to Maersk, he spent 25 years at Swiss specialty chemicals company Clariant AG, holding a range of senior finance, general management and corporate development roles across Europe, Asia and the Americas, eventually becoming group CFO. Earlier in his career, he held finance leadership roles at Sandoz AG, Clariant’s predecessor.

    Jany holds a Master of Business Administration degree from ESCP Business School.

    “As CFO, he will be part of a strong management team, leading and shaping Borouge International into a global industrial leader with scale, reach and financial discipline, supporting its long-term growth ambitions,” the company said in its statement.

    Chemicals giant

    Abu Dhabi National Oil Company’s (Adnoc Group) overseas investment arm XRG and Austrian energy major OMV completed the creation of Borouge International, a global chemicals giant with the fourth-largest polyolefins production capacity in the world, on 31 March.

    The new entity was formed by the merger of Adnoc Group and OMV’s respective shareholdings in Abu Dhabi chemicals producer Borouge and Austria-based Borealis, as well as the acquisition of Canada-based Nova Chemicals.

    Adnoc and OMV started the transaction to merge their interests in Borouge and Borealis, as well as acquire Nova Chemicals, in March last year. In July, Adnoc announced it would transfer its stake in Borouge International to XRG upon completion of the transaction.

    Borouge International is headquartered and tax-domiciled in Austria, with regional headquarters in Abu Dhabi, UAE. The new company will operate corporate hubs across North America, Europe and Asia, with innovation centres in the UAE, Austria, Canada, Finland and Sweden.

    Financial prospects

    Borouge International will benefit from a superior resilient margin profile and well over $500m in identified earnings before interest, taxes, depreciation, and amortisation (ebitda) run-rate synergies per annum, with 75% expected to be realised within the first three years, XRG said at the time of creation of the entity.

    “The company’s global reach, combined with long-term shareholders and a robust capital structure, will deliver resilience throughout the business cycle and an enhanced ability to drive consistent performance and sustainable value for shareholders,” XRG said in its statement.

    The new company has also secured credit ratings of A (Negative) / Baa1 (Stable) / A- (Stable) ratings from S&P, Moody’s and Fitch, respectively, “confirming its robust financial position and capital structure and ability to access a range of long-term financing options”.

    “XRG and OMV are committed to maintaining investment-grade credit ratings for Borouge International,” they said.

    Additionally, Adnoc and OMV plan to tender an offer to convert Borouge Plc shares to Borouge International AG shares, thereby “creating a simplified structure that will enable value creation from the new global growth platform”.

    The tender offer is expected to take place in 2027, subject to market conditions and approval by the UAE Capital Market Authority, with its timing “aligning with the new company’s future equity raise, to maximise value for all shareholders”.

    Until then, Borouge International will be privately held, and Borouge Plc shares will remain listed on the Abu Dhabi Securities Exchange (ADX). The recently received credit ratings factor in the impact and flexibility on timing of both the future equity raise and the planned acquisition of Borouge 4 at cost by Borouge International.

    Borouge International also recently announced a dividend payment of $1.32bn for 2025, “reflecting the company’s strong operational performance and record sales”.

    The final shareholder-approved dividend payment for 2025 amounts to $658m (8.1 fils per share), bringing the total 2025 dividend to approximately $1.32bn (16.2 fils per share). The dividend will be paid on or around 7 May to all shareholders of record as of 17 April.

    Including this dividend, Borouge Plc will have distributed $4.89bn in dividends since listing, one of the largest payout levels on the ADX over this period.

    https://image.digitalinsightresearch.in/uploads/NewsArticle/16476909/main.gif
    Indrajit Sen
  • Dubai’s RTA opens Hessa Street upgrade

    20 April 2026

    Dubai’s Roads & Transport Authority (RTA) has opened Hessa Street for public traffic after announcing that the construction of the road’s expansion has been completed.

    The scope of the project included expanding Hessa Street from two to four lanes in each direction and developing four intersections with Sheikh Zayed Road, First Al-Khail Street, Al-Asayel Street and Al-Khail Road. 

    The project increases the road’s capacity from 8,000 to 16,000 vehicles an hour in both directions.

    It will reduce the travel time from Sheikh Zayed Road to Hessa Street from 15 minutes to just four minutes.

    The Sheikh Zayed Road intersection will have a two-lane road heading from Sheikh Zayed Road to Hessa Street, eastwards to Emirates Road.

    The upgrade of the First Al-Khail intersection includes increasing the number of lanes from three to four in each direction on the existing Hessa Street Bridge.

    The third improvement covers upgrading the Hessa Street and Al-Asayel Street intersection by increasing the number of lanes from two to four in each direction.

    The Hessa Street and Al-Khail Road intersection upgrade includes the construction of a two-lane road to serve traffic travelling northwards to Al-Khail Road in the direction of Sharjah.

    The project mainly serves residential areas, including Al-Sufouh 2, Al-Barsha and Jumeirah Village Circle.

    In February 2024, MEED exclusively reported that the RTA had awarded a AED689m ($187.5m) contract to Turkiye’s Gunal Construction for the first phase of the Hessa Street improvement project.

    The RTA recently started the construction works on the second phase of the project.

    The scope covers upgrade works on three intersections, including the construction of bridges totalling 8.8 kilometres (km), a 480-metre tunnel, and enhancements to access points on surrounding roads to improve entry and exit flow on a 3km stretch between Al-Khail Road and Sheikh Mohammed Bin Zayed Road.

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

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

    Distributed to senior decision-makers in the region and around the world, the April 2026 edition of MEED Business Review includes:

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16475593/main.jpg
    Yasir Iqbal
  • Kuwait LNG project expected to be worth about $200m

    20 April 2026

     

    The planned Kuwaiti project to develop a reliquefaction unit at the Al-Zour LNG import terminal is expected to be worth about $200m, according to industry sources.

    The client on the project is state-owned Kuwait Integrated Petroleum Industries Company (Kipic).

    The project is focused on the development of a boil-off-gas unit at the import terminal, according to a report in Kuwait’s Al-Anba newspaper.

    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)

    Kuwait’s LNG import terminal is currently not operating due to disruption caused by the US and Israel’s war with Iran.

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

    Economic shock threatens long-term outlook; Riyadh adjusts to fiscal and geopolitical risk; GCC contractor ranking reflects gigaprojects slowdown.

    Distributed to senior decision-makers in the region and around the world, the April 2026 edition of MEED Business Review includes:

    > GCC CONTRACTOR RANKING: Construction guard undergoes a shift
    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16445370/main1228.jpg
    Wil Crisp
  • Saudi Arabia’s Misk tenders residential package

    17 April 2026

     

    Saudi Arabia’s Mohammed Bin Salman Foundation (Misk Foundation) has floated two tenders for the construction of a residential community in District 5 of Prince Mohammed Bin Salman Nonprofit City in Riyadh.

    The first tender is split into two packages, one that covers the construction of 237 villas and the other covering 223.

    The second tender covers the construction of a community centre, swimming pool, mosque and school.

    The bid submission deadline for both tenders is 27 April.

    Misk Foundation is jointly developing the project in collaboration with local real estate developer Kinan.

    The estimated SR900m ($240m) project will span an area of about 121,692 square metres.

    In March 2022, the Misk Foundation released the masterplan for Prince Mohammed Bin Salman Nonprofit City.

    Saudi Crown Prince Mohammed Bin Salman Bin Abdulaziz Al-Saud said in November 2021 that the Misk Foundation development in Riyadh will be the world’s first non-profit city.

    “Prince Mohammed Bin Salman Nonprofit City, which implements the digital twin model, will host academies; colleges; Misk schools; a conference centre; a science museum; and a creative centre offering a space to support the ambitions of innovators in sciences and new-generation technology, such as AI [artificial intelligence], IoT [Internet of Things] and robotics,” he said.  

    “It will also feature an arts academy and art gallery, a performing arts theatre, a play area, a cooking academy and an integrated residential complex.

    “In addition, the city will host venture capital firms and investors to support and incubate innovative enterprises to drive community contributions from around the world.”

    The consultants working on the project include Germany’s Albert Speer + Partner as master planner and architect, and UK-based Buro Happold as the engineer. The project manager for the first phase of construction is UK-based Mace.

    MEED’s April 2026 report on Saudi Arabia includes:

    > COMMENT: Risk accelerates Saudi spending shift
    > GVT &: ECONOMY: Riyadh navigates a changed landscape
    > BANKING: Testing times for Saudi banks
    > UPSTREAM: Offshore oil and gas projects to dominate Aramco capex in 2026
    > DOWNSTREAM: Saudi downstream projects market enters lean period
    > POWER: Wind power gathers pace in Saudi Arabia
    > WATER: Sharakat plan signals next phase of Saudi water expansion
    > CONSTRUCTION: Saudi construction enters a period of strategic readjustment
    > TRANSPORT: Rail expansion powers Saudi Arabia’s infrastructure push

    To see previous issues of MEED Business Review, please click here
    https://image.digitalinsightresearch.in/uploads/NewsArticle/16440697/main.png
    Yasir Iqbal