USSABC: Saudi Arabia contracts grow 101% to $30bn in H1 2019
US-Saudi Arabian Business Council says contracts worth $17.2bn were awarded in the kingdom during Q2 2019
Contracts worth $17.2bn (SAR64.3bn) were awarded in Saudi Arabia during Q2 2019 – marking a 32% hike over Q1 2019 figures – with H1 2019 contract awards in Saudi Arabia valued at $30.2bn (SAR113.2bn), 101% higher than H1 2018 figures, according to US-Saudi Arabian Business Council’s (USSABC) Contract Awards Index for the second quarter of 2019, which found that the oil and gas segment led all sectors with contract awards worth $12.7bn (SAR47.7bn), followed by real estate and military with contracts respectively worth $1.4bn (SAR5.1bn) and $835m (SAR3.1bn).
Q2 2019 marks the highest value of awarded contracts by quarter since Q2 2015, when awarded contracts were valued at $17.4bn (SAR64.9bn).
USSABC’s Contract Awards Index reached 238.67 points during Q2 2019, reflecting the highest mark since March 2016.
For the second consecutive quarter, the Eastern Province and Makkah regions contributed the largest share of awarded contracts, constituting 77% and 13% of awarded contracts respectively.
In the Eastern Province the largest contracts were in awarded in the oil and gas, transportation, water, power, and real estate sectors, while in Makkah, the largest contracts were awarded in the military, industrial, and real estate sectors.
May 2019 was the slowest month for contract awards in Saudi Arabia, when values reached $1.9bn (SAR7.2bn), with June being the most valuable month with contract awards worth $12.7bn (SAR47.8bn).
In the real estate sector during Q2 2019, the residential segment alone saw contracts worth $1bn (SAR3.9bn), USSABC said. In the military sector, Makkah’s largest contract for Q2 2019 – worth $800m (SAR3bn) – was awarded by Saudi Arabia’s Ministry of Defence. The industrial sector noted contract growth with awards to India’s Larsen & Toubro (L&T) and Finland’s Outotec for the Mansourah-Massarah Gold Mine project by Saudi Arabian Mining Company’s (Ma’aden) subsidiary Gold and Base Metals Company.