Riyadh – Mubasher: Saudi Arabia will be the Middle East’s busiest construction market over the course of the next decade as its new wave of major projects makes progress, according to GlobalData’s MEED.
The Gulf state will showcase about 1,000 projects worth more than $160 billion at the third Future Projects Forum (FPF) held virtually by the Saudi Contractors Authority (SCA) from 22-24 March.
Deputy Editor at GlobalData’s MEED, Colin Foreman, commented, “As work starts to move on site, attention is also focused on how these schemes will be funded. Most of the projects, such as The Red Sea Project, Diriyah Gate, Qiddiyah, and the $500bn Neom, are being developed by subsidiaries of the Public Investment Fund (PIF), which has so far provided the initial funding.”
PIF will not be able to shoulder all of the funding requirements and Riyadh has been figuring out other options. Utilities packages on several developments are being carried out using public-private partnerships (PPP), besides local and international financial support.
Earlier this month, the Saudi bourse penned an agreement with the Projects Support Fund initiative to provide listed companies with project financing support in the form of long-term loans for the healthcare, education, and real estate sectors.
Internationally, Riyadh inked agreements with export credit agencies to support Japanese and South Korean companies working on Vision 2030 projects in the kingdom. The finance ministry signed the agreements with Japan’s Nippon Export & Investment Insurance (Nexi) and South Korea’s K-Sure.
“As the pace of construction on Saudi Arabia’s Vision 2030 projects accelerates, these financial agreements – together with any other future deals – will play an important role in delivering the kingdom’s economic ambitions,” concluded Foreman.