Saudi gigaprojects create long-term construction market
28 November 2024
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Speakers participating in a panel discussion on Saudi Arabia’s gigaprojects at MEED’s Mena Construction Summit 2024 in Dubai on 20 November discussed the progress of what is shaping up to be the world’s largest construction programme.
There are five official gigaprojects in the kingdom. They are Diriyah, Neom, Qiddiya, Red Sea Global’s projects and Roshn. All five are subsidiaries of the Public Investment Fund (PIF). In addition to these projects, there is a wide range of other very large schemes commonly referred to as gigaprojects, such as New Murabba and King Salman Park.
These projects, launched from 2017 onwards, have faced and continue to face considerable delivery challenges. Due to their vast scale, one of the main challenges has been attracting construction resources to the kingdom. The panellists said that while progress has been made in this regard, lots of work still needs to be done.
Several major European contractors have won work on the gigaprojects over the past five years. They include France’s Bouygues, Spain’s FCC and Italy’s Webuild.
Companies from the Far East include Hyundai Engineering & Construction, Samsung C+T, and a range of Chinese contractors including China State Construction Engineering Corporation, Powerchina and China Harbour Engineering Corporation.
Regional contractors have also played a role, with GCC-based contractors such as Dubai-based Alec and Qatar’s UCC securing major contracts. Egyptian companies have also played an important role with contractors such as Hassan Allam winning work.
Looking ahead, the panellists said that more contracting resources will need to be developed. This will involve roadshows to other markets around the world to promote awareness of the business opportunities available in Saudi Arabia to bring in new players and grow resources within the kingdom.
In 2023, the PIF invested in four contracting companies: Al-Bawani, Almabani, El-Seif Engineering Contracting and Nesma & Partners. In the future, more investment will be needed in the supply chain.
The business case for these investments is becoming stronger as the gigaprojects programme gathers momentum and demonstrates that it is creating a long-term market rather than discrete opportunities for construction companies in Saudi Arabia.
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