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Wed 23 Apr 2014 11:26 AM

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Dubai's Drake and Scull wins $40m Algeria contract

North African state limited the access of foreign companies to its construction market for decades

Dubai's Drake and Scull wins $40m Algeria contract
Drake & Scull CEO Khaldoun Tabari.

Dubai construction firm Drake and Scull
International has won a AED147m ($40m) project to build a mixed-use development
in the capital of Algeria, the company said on Wednesday.

Drake and Scull will undertake the civil
construction portion of the project in Algiers, covering a total built-up area
of about 66,500 square metres, it said.

Algeria limited the access of foreign companies to
its construction market for decades but over the past couple of years it has
been opening the market, in an effort to build housing faster and alleviate a
shortage that is a major source of social discontent.

The government allocated about $50bn to the housing
sector under a five-year, $286bn state spending plan that aims to modernise
infrastructure and create jobs between 2010 and 2014. It has said it is ready
to spend more money if necessary.

Authorities have said they want to build 200,000
housing units annually, but local companies' total construction capacity has
been estimated at no more than 80,000 units.

The Dubai-based building contractor made a net
profit of AED185m ($50.37m) in 2013, up from AED115m in 2012.

Fourth-quarter profit was AED40m, according to
Reuters calculations, up from AED26.74m a year ago.

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