Dubai: The building materials trade for companies in the Jebel Ali Freezone Authority (Jafza) grew 14 per cent last year.
The trade in iron, steel, cement, plaster, stone and other goods generated Dh12.26 billion in 2010 compared to Dh10.75 billion in 2009, according to Jafza officials.
Raju Menon, chairman and group managing partner of Morison Menon Group, said an increase in demand for re-exported material was behind the improvement.
"There are many other countries in the region where construction is going on and companies here can take advantage of re-exporting the material," Menon told Gulf News.
"There are reconstruction projects happening in Saudi Arabia and Qatar and that is most likely the main reason for the increase in trade for Jafza companies.
"The other reason for the increase is the general trend of what is happening here. Certain buildings are beginning their reconstruction."
Trend to continue
Ebrahim Al Janahi, Jafza deputy CEO and chief commercial officer of Economic Zones World (EZW) UAE predicted the upward trend would continue over the next few years, with a report issued recently by Masah Capital Limited saying the GCC plans to invests $3 trillion (Dh11.02 trillion) in the infrastructure, leisure and in the tourism sector by 2020.
"The industry was affected by the slump in 2008 but 2009 and 2010 saw an upturn and we are sure this momentum can be maintained," Al Jahani said.
"The recent wave of GCC-wide infrastructure projects that have been announced by governments in the region is expected to drive construction industry recovery."
The organisers of the Big 5 International Building and Construction Show predicted that construction spending in the emerging markets of this region would be more than $600 billion by 2015.
The UAE, Saudi Arabia and Qatar account for almost 80 per cent of the on-going $452 billion worth of infrastructure projects that are expected to give a much-needed boost to the GCC construction industry, according to a recent report by market research specialists Ventures Middle East.
Major projects in pipeline
However, Yousuf Al Rahmani, managing director of Al Rahmani General Trading, said it is too early for building material suppliers to benefit from this surge in infrastructure investment.
"Within our company we're seeing a growth of around 5 per cent," he said.
"We're hoping it might grow further over the next few years.
"It is too early for the building material industry to benefit from the $3 trillion that will be invested in the region's infrastructure.
"Now we are seeing a few major projects which are government funded however, we are hoping to see more private projects."
