MENA Construction Output Growth Forecast Drops
The construction output growth forecast for the Middle East and North Africa (MENA) region for 2020 predicts a contraction of 4.5 percent this year, before a recovery with growth of 1.9 percent in 2021, and 4.1 percent in 2022, according to GlobalData. The region is wrestling with two distinct but related issues: climate change, and the slowdown in oil demand. The data and analytics company reports that the 2020 contraction reflects the severe impact of COVID-19 lockdowns, as well as other restrictions on construction activity. Much will depend on its ability to embrace digital transformation. Yasmine Ghozzi, economist at GlobalData, said The construction sector will face headwinds in 2021 with a slow recovery, but the pace of recovery will be uneven across countries in the region. Throughout 2020, and running to 2021, spending on real estate megaprojects, especially in the GCC, is likely to take a backseat as a result of budget revisions. However, large-scale projects in the oil, gas, power and water sectors have gained traction against the downturn in market conditions this year, and this is likely to continue. As a result, some local contractors are pursuing development in these sectors to replace the loss of real estate work. There is also a push towards decoupling power and water production across the region to reduce energy consumption continuing to provide the impetus for Independent Water Projects (IWP) implementation and in the future, there will be a lot of contract awards in that respect as the region pushes its renewable energy programme, particularly solar photovoltaic and wind.
Tags : INTERNATIONAL construction growth Middle East North Africa MENA region