Tuesday, December 10, 2013

Abu Dhabi To Spend $100 Billion On Projects!

Abu Dhabi’s project spending could balloon to over $100 billion in the next seven years as the government ramps up efforts to sustain economic gains built over the last few years.

The 8th Abu Dhabi Conference 2013, which began yesterday, highlighted the key sectors that will receive the bulk of investments until 2020.

According to MEED, which tracks projects activity throughout the Middle East, construction projects remain the most active with $30 billion worth of projects to be awarded in the next seven years, followed by the Oil & Gas sector with a project pipeline valued at $25 billion.

Transport and chemical-related projects will also see a surge in investments with a total of $20 billion contracts to be awarded during the same period. The industrial as well as power & water sectors will likewise be busy with contracts valued at $6 billion and $5 billion to be awarded until 2020.

H.E. Eng. Mohammed Ahmed Bin Abdul Aziz Al Shehhi, Undersecretary of the Ministry of Economy delivered the opening address this morning, and said that the UAE economy is growing strongly and will benefit from new government measures designed to promote the private sector and foreign investment. “The UAE economy is on solid ground. It has been attracting visitors and investors looking for a safe haven in the Middle East. Growth was 4.4 percent in 2012, its fastest pace since 2006. In view of improved activities, we expect UAE GDP to have expanded by 4.5 percent this year.”

Abu Dhabi Department of Economic Development (ADDED) Undersecretary H.E. Mohammed Omar Abdullah then spoke to the conference delegates about creating a business hub critical to the global economy, highlighting the initiatives and upcoming projects aimed at driving long term investments into Abu Dhabi.

And for the first time at a conference – H.E. Dr. Abdullah Hassan Ghareeb Al Bloushi, Executive Director, Land and Property Management Sector, Department of Municipal Affairs presented details of the Onwani project – the unified addressing and wayfinding project for the Emirate of Abu Dhabi, saying “This is the largest project the municipal system in Abu Dhabi has ever undertaken, and it is also one of the Emirate’s most important. The vital infrastructure provided by the new addressing system will take us forward to meet future economic and social challenges and bring real benefits to residents, businesses and visitors alike. It is not only a street map for the Emirate, but a road for development.”

This year alone, based on an article 'Gulf projects market hits new peak' recently released by MEED, the construction sector in Abu Dhabi picked up pace when the Tourism Development & Investment Company (TDIC) awarded the long-awaited $653m contract to build the Louvre Museum on Saadiyat Island to a consortium comprising the local Arabtec Construction, Spain’s San Jose and Oger Abu Dhabi – the local affiliate of Saudi Oger.

TDIC has also tendered the contract to build the Zayed National Museum on Saadiyat Island, although an award is not expected this year. In July, Abu Dhabi-based Saadiyat Investment & Development Company awarded a $482m contract to local Al-Jaber Building for the construction of 462 villas at the Hidd al-Saadiyat Villas Development on the island.

As a result, along with new projects awarded in Dubai, the UAE has seen the largest rise in project activity in the GCC this year. MEED’s Gulf Projects Index is now at its highest level ever, having reached $3.19 trillion this month.

“The return to growth is the latest chapter in what has been a roller coaster ride for the index over the past seven years. The index remained relatively flat until about 12 months ago, when it began to move upwards as stalled projects were revived and new schemes launched, which has seen it grow more than 30 percent to its current level of $3.19 trillion. The major driver of this growth has been the UAE, with Abu Dhabi contributing a significant chunk of investments,” said Richard Thompson, Editor, MEED.

By 2014, the IMF has forecasted real GDP growth for the UAE of 3.6 percent (up from 3.1 percent last year) owing to the government’s continued push to boost the economy led by a spate of new infrastructure investments.

“Abu Dhabi has targeted knowledge-intensive sectors, such as aviation, petrochemicals, renewable energy and health care. The developments across these strategic sectors are aimed to make the capital an attractive proposition for domestic and international investors,” said Abraham Akkawi, MENA Infrastructure Advisory Services Leader, Ernst & Young.

Yesterday’s highlights included a special VIP Plenary Session that provided a snapshot of project opportunities, achievements and challenges faced in delivering Abu Dhabi’s economic vision 2030 across key sectors. The session was led by a panel of authorities from Abu Dhabi’s key agencies such as the Abu Dhabi Food Control Authority (ADFCA), Environment Agency- Abu Dhabi (EAD), Health Authority Abu Dhabi (HAAD), Industrial Development Bureau as well as the Khalifa Fund for Enterprise Development.

The Abu Dhabi Conference is an annual gathering of government and private sector leaders which enables discussions and updates on upcoming project and investment opportunities in Abu Dhabi’s diverse economy. It is a heavily Government supported event, with the Abu Dhabi Department of Economic Development, Abu Dhabi Sustainability Group, Western Region Development Council and Abu Dhabi Tourism and Culture Authority as supporting partners; The Abu Dhabi Water & Electricity Authority as Strategic Partner, Zones Corp as Industrial Partner and the Abu Dhabi Chamber as silver sponsor. Other conference partners include Al Khalij Bank Hill International, E&Y, Bentley Systems and Mashreq. For more information on the conference: http://www.theabudhabiconference.com/

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