Jizan region accounted for 53% of the total value of project awarded in 2014 followed by Eastern Province (32%) and Madinah (15%). The majority of the contracts were awarded in Jizan as part of the Jizan Refinery and terminal project.
According to Marmore’s KSA Contracting report, the Saudi real estate sector has ongoing projects worth USD 75.1billion. The Saudi government is focussing on developing the education infrastructure in the country. Moreover, the level of expenditure on the construction of healthcare facilities is likely to increase in 2015, as government has allocated budget of approximately USD 44 billion for the healthcare sector. The Saudi government’s focus on diversifying the economy will drive industrial construction.
The main challenges for the contracting industry include increasing competition, soaring costs, and limited availability of skilled and unskilled labour and constrains on working capital management. Despite these challenges, the contracting industry is projected to post a strong double digit growth and has enormous potential for further growth in the coming years due to the vast number of projects being planned and executed across various industry verticals. The near and long-term prospects for the industry are positive.
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