Industry Trend Analysis - Smaller Emirates Supporting Positive Overall Construction Story - OCT 2017

BMI View: The expansive infrastructure investment plans of the smaller emirates of the UAE - Sharjah, Fujeirah, and Ras Al Khaimah - support our positive construction sector growth outlook for the country, though the overwhelming focus of infrastructure development will remain centred in Dubai and Abu Dhabi.

Our positive view of the United Arab Emirates' (UAE) construction growth is primarily informed by elevated levels of project activity focused in the emirates of Dubai and Abu Dhabi; having said that, we expect that the smaller emirates that comprise the country - particularly Sharjah and Fujairah - will play an increasing role in driving growth as ambitious infrastructure investment agendas swell their respective project pipelines in the coming years.

Sharjah: The Emirate's 2017 budget will allocate a record amount of funding to infrastructure investment, with the government pledging USD6bn for the year. This represents a 7% year-on-year increase and roughly 30% of the overall budget, which will feed into greater levels of construction sector activity in 2018 and beyond. The increased emphasis on infrastructure development is evident in the quickening pace of project activity we have seen in Sharjah over the course of 2017 - most notable is the recent announcement that Sharjah-based Arada - a joint venture between Basma Group and KBW Investments - has agreed to build the largest-ever mixed-use, master-planned project in the emirate, one which will eventually house approximately 70,000 people at a cost of USD6.5bn. Other projects currently progressing through Sharjah's pipeline include:

  • Abu Dhabi & Dubai To Remain Key Growth Drivers
    UAE: Project Value By Emirate, USDmn
    Source: BMI Key Project Database

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