Infrastructure projects set to drive GCC spending - QNB

  • Share via facebook
  • Tweet this
  • Bookmark and Share

GCC governments are expected to raise their capital budgets to more than eight percent of the region's GDP this year as spending on infrastructure projects soars, a new report said on Sunday.

After spending $112bn on capital projects in 2012, QNB Group said it forecasts expenditure to rise from 7.1 percent to 8.2 percent of gross domestic product.

The research said this will be the second highest share on record after 2009 which was distorted because low oil prices that year reduced regional GDP by 19 percent.

Rail schemes such as the Doha, Riyadh and Abu Dhabi metros and the high speed inter-city rail network under construction in Saudi Arabia, will all boost GCC capital spending going forward, QNB Group said.

"Effective public capital expenditure in the GCC is even larger than the budget data suggests. This is because government agencies sometimes spend off budget and because of the usage of public private partnerships for some megaprojects," the report said.

It added that there were "significant differences" in relative spending levels between Gulf states.

Looking ahead, QNB Group said it expects that government capital expenditure, both direct and through public-private partnerships, will remain high throughout the GCC over at least the next decade.

Common themes across the region include rail networks to relieve congestion in major cities and connect the Gulf's major coastal hubs, it said.

Also further expansions are planned in power and water desalination capacity plus social spending on schools, hospitals and housing.

Many GCC countries have medium term spending plans running into hundreds of billions of dollars.

Saudi Arabia committed in 2011 to invest $67bn on housing alone, to build half a million new homes. Meanwhile, Abu Dhabi has committed to $90bn in capital expenditure between 2013-17.

Related:

Market Performance

Qatar National Bank - Qatar
192.0
-2.0 -1.03 (%)
Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

Please post responsibly. Commenter Rules

  • No comments yet, be the first!

Enter the words above: Enter the numbers you hear:

All comments are subject to approval before appearing

Further reading

Features & Analysis
Women edge into Gulf boardrooms as economies, societies shift

Women edge into Gulf boardrooms as economies, societies shift

Amina al-Rustamani, CEO of TECOM Investments, is leading the...

1
Concerned for stability, Saudi Arabia tightens curbs on dissent

Concerned for stability, Saudi Arabia tightens curbs on dissent

Gulf kingdom intensifies crackdown on domestic dissent, raising...

Frustrated Kuwaitis ask, why is Kuwait falling behind?

Frustrated Kuwaitis ask, why is Kuwait falling behind?

Citizens wonder why oil producer Kuwait is not as dynamic a hub...

4
Most Discussed
  • 15
    Germany puzzled as UAE think tank ordered to close

    Matt, your words sound kind of funny given the role the Britain has played in this region for so many decades.
    And given the democratic tradition that... more

    Thursday, 17 April 2014 7:10 PM - one of the joes
  • 10
    UAE father who whipped son to death wins appeal

    "Under Sharia, a parent cannot be executed for killing their child"
    A spouse could be executed if he/she kills his/her spouse, as none of them is... more

    Friday, 18 April 2014 3:38 PM - Nihar
  • 3
    To diet or not to diet?

    It is best to eat by your blood type. Following this diet is miraculous. Generic diets don't always work as certain foods are not good for the individual... more

    Friday, 18 April 2014 11:49 AM - Shamira Mitha
  • 54
    Three UAE women attacked with hammer at London hotel

    I really feel that Arabian Business.Com should now close this comments page. This should be all about sympathy for the families not what it is/has turned... more

    Wednesday, 16 April 2014 1:06 PM - Adrienne
  • 51
    Why Dubai isn't a plastic city

    What is definitely not a plastic city. The Arabs have a culture dating back to several centuries. 50 years back Dubai was just a fishing village. Today... more

    Tuesday, 8 April 2014 3:49 PM - P. MADHUSUDAN
  • 48
    DMCC boss Ahmed Bin Sulayem entertains Robert Mugabe in Dubai

    @fga ''However today, simply because he decided to dispossess a few white farmers of their land and redistribute to the poorer indigenous blacks'' more

    Sunday, 13 April 2014 3:02 PM - Matt Williams