Dubai: The forecast of contract awards in the GCC for this year is at $140 billion (Dh513.8 billion), about a 17 per cent decline compared to 2015, according to MEED.

Awards in 2015 across the GCC amounted to $165 billion, a good year when you consider historical trends. On a country level, KSA and the UAE did not perform as expected, whereas Qatar and Kuwait exceeded historical awards. In Qatar this was due to investments in infrastructure and the World Cup preparation, and in Kuwait primarily due to large oil and gas investments.

Saudi Arabia has been the most impacted market and the forecast is a $10 billion fall in contract awards to $40 billion, though it continues to be the largest project market and the biggest spender among the GCC countries, according to Deloitte.

Given the gap between the Gulf’s huge infrastructure capital needs and the ability and willingness of sovereigns to continue to foot most of the bill, as well as their moves to develop PPPs in their countries, rating agency Standard & Poor’s said that the private sector and the capital markets will be playing a larger role this year and years to come.

The forecast of contract awards in the UAE is set to be stable and mainly driven by the robust construction market in Dubai. In Dubai, significant projects have been awarded during the first months of 2016 totalling $8.3 billion. The largest award is the Atlantis hotel expansion on the Palm Jumeirah, followed by the first tower at the Creek Harbour development and the Palm Gateway Towers, a three tower residential complex. Other major building schemes are the Burj 2020 development, a district that will include one of the world’s tallest commercial towers, and the Route 2020 metro link developed by the Roads & Transport Authority (RTA).

There is a substantial amount of projects to be delivered in Qatar such as stadiums, hotels, rail and roads in order to enable the World Cup and the forecasted value of contract awards stands at$22 billon. Oman is expected to remain stable with values around $13 billion, and Kuwait has a strong amount of planned activity for this year in the construction and transport sectors.

“There is a huge amount of project investment due to take place between now and the end of this decade. A growing population in the region will demand improved infrastructure for the cities to function and grow as planned. At a time where governments are facing budget deficits, their ability to adjust to the new environment, innovate and find alternative funding solutions to bridge the funding gaps required for ongoing investment will be key to the long term diversification success,” said Cynthia Corby, Audit partner and Middle East Infrastructure and Capital Projects leader at Deloitte