CW In Focus | Chinese firms chart growth in the Middle East
Q1 and Q2 2019 have been outstanding for Chinese comapnies in the Middle East, largely due to Etihad Rail contract wins
Chinese construction companies are known around the world for their engineering prowess, and their role in the Middle East’s construction sector is only getting bigger, as their performance in June 2019 has shown.
UAE-China ties have deepened "following the visit of Chinese President Xi Jinping in July 2018".
Late in June, Tencent Games, the Chinese company that is part owner of popular multi-player titles such as Fortnite and Pub G, signed an MoU to launch its new HQ in Dubai Internet City.
Saudi Arabia’s Public Investment Fund-backed Acwa Power signed an agreement with China’s Silk Road Fund in June.
The agreement saw the Chinese fund become a partner and 49% shareholder in Acwa Power Renewable Energy Holding, or Acwa Power Renewco, a subsidiary that owns “a number of” Acwa’s renewable energy projects. It was the first of two major renewable energy milestones recorded by Chinese companies in June.
Late in the month, it was announced that construction had completed on the $871m Noor Abu Dhabi plant in the UAE, which was co-built by a JV of Abu Dhabi Power Corporation, and a consortium comprising Japan’s Marubeni and China’s Jinko Solar Holding.
Chinese companies also closed Q1 and Q2 with a splash in the Middle East, largely due to their major wins on Etihad Rail.
Late in June, Etihad Rail, the developer-operator behind the UAE’s 1,200km rail network, said it had approved construction contracts worth $1.2bn for Packages B and C of the network’s Stage 2.
China Railway Construction Corporation was awarded Package B of the project, which spans 216-kilometres. The win followed Etihad Rail’s award of Package A of Stage 2 in March 2019.
A consortium of the Yu Tao-led China State Construction Engineering Corporation Middle East (CSCEC ME), also comprising South Korea’s SK Engineering & Construction, was picked for Package A.
Chinese investment in the Middle East’s building industry is on the up, and if the first half of 2019 was any indicator, then the remaining six months of the year will be an exciting period for Middle East construction’s ties with China.