Dubai: Qatar retained its second spot while the UAE moved up one place in the global rankings for the most attractive markets for investment in infrastructure. This is according to findings by the consultancy EC Harris, which also found that the US and the UK made it to the top 10 after refocusing their efforts on upgrading infrastructure. Saudi Arabia was placed in 12th spot, while Singapore remained in top spot.
“Almost half of the investment planned in the region is related to transportation, with every major city in the region planning to follow Dubai in building a metro system with lines being constructed simultaneously in a relatively short period of time,” said Tim Risbridger, partner and head of Infrastructure for the Middle East at EC Harris.
The findings were based on factors including the ease of doing business in each market, tax rates, GDP per capita, government policy, the quality of the existing infrastructure and the availability of debt finance. Combining these provided an overview of the risk profile for each market and how attractive each one is likely to be to potential investors.
“A key differential that we have seen in Asian and Middle East markets is that those countries that have a clear integrated strategy that ties the infrastructure development plans to business and economic objectives tend to nearer the top of our ranking,” said Risbridger. “This gives long term clarity to investors and is something that European markets, in particular, would do well to emulate if they are to succeed in attracting more private finance into infrastructure.”
According to the report, the key risk is inflation in construction resources, “from manpower and specialist skills to construction commodities”. “Despite the potential for rising inflation, the Gulf countries’ strong credit ratings and enviable taxation regimes will continue to appeal to investors”, it added.
The second ARCADIS ‘Global Infrastructure Investment Index’ ranks 41 countries.
