International Contractors Diversify The Competitive Landscape
BMI View: BMI 's Infrastructure Key Projects Database shows domestic firms hold the largest market share in Saudi Arabia's construction industry. Their market share however has reduced in recent years as more international players successfully enter the market. In particular, South Korean and US firms are targeting industrial projects, while European firms look more towards transport and energy projects. We believe the business environment for international players is the greatest challenge they face and needs to be a key consideration for those targeting the market.
Saudi Arabia is one of our favoured long-term markets for construction in the Middle East in terms of scale, growth potential and sustainability of the industry. With its vast oil wealth, large population and wide-ranging economic diversification plans - as opposed to more industry specific plans elsewhere in the GCC - Saudi Arabia will be able to sustain the market's current high construction industry growth rate, according to our forecasts.
Saudi Arabia has become a major destination for international construction, engineering and service companies looking outside their domestic and regional markets for opportunities and we expect this to continue as the Saudi economy becomes more diversified, benefitting a wider range of construction players.
|Saudi A Long-Term Favourite|
|Construction Industry Real Growth, % Change year-on-year|