Modon: An expected growth rate of 7% for the construction market in Kuwait to reach $65 billion during 2023
Mar 19 , 2023
Modon Al Ahlia Real Estate Company expects that the building and construction market in Kuwait will witness a growth rate of 7% to reach $65 billion during the year 2023, with continued improvement in government revenues and an increase in the general budget surplus for the year 2022-2023 to more than $16.5 billion by the end of March 2023 and the launch of more projects. Governmental. The company explained in a specialized report on the construction market that Kuwait accounts for about 5% of the size of the construction market in the region, the total size of which is estimated at about $1.3 trillion, which represents the projects currently being implemented and expected to be launched by either the government or the private sector during the year 2023.
The report stated that the growth of the construction sector in Kuwait will include various activities, the most important of which are infrastructure projects, then residential and commercial real estate, and finally industrial construction, including energy and utility projects, especially if the new government begins to activate plans to launch more projects.
The report indicated that growth expectations come in an atmosphere dominated by optimism about the future of the sector, despite the Coface International Foundation’s warning of the high risks that the construction sector suffers from in the Middle East region, which includes the Arab countries and Turkey, compared to other regions in the world, as a result of the continued rise. The relative indebtedness of companies operating in this sector and the high level of indebtedness of the sector’s clients, especially families, in addition to the risks of supply chain disruption, labor shortages, and the sector’s impact on global events, the most important of which are the health crisis and the repercussions of the Russian-Ukrainian war.
Coface, which specializes in providing insurance services against commercial and political risks for investment, trade and finance around the world, explained in its report on business risks in 13 major sectors around the world: construction, agriculture, automobiles, chemicals, energy, information and communications technology, metals, paper, pharmaceuticals and retail. , textile and clothing, transportation, and wood. The Middle East region is still one of the highest global regions in risk rates for the construction sector.
However, the French company operating in 66 countries around the world and listed on the Paris Stock Exchange believes that there are a number of factors that can reduce the severity of the risks, the most important of which is the continued high population growth in the countries of the region and the increasing rates of growth from rural to cities and urban areas, in addition to acknowledging Many urban expansion plans and infrastructure projects in many countries of the region to benefit from the savings of high global oil prices. The report expected an acceleration of the pace of work on many major projects, including metro projects, in addition to other major construction plans, such as long-distance railway lines, highways, airports, bridges, and sports stadiums, as well as residential and commercial real estate projects.
