(MENAFN- Muscat Daily) The construction industry in the sultanate is expected to remain robust driven by significant increase in infrastructure projects along with many tourism projects as well as the construction of private and commercial buildings according to an Alpen Capital report.
The report released on Tuesday says the GCC construction industry is witnessing a growth phase.
UAE accounted for the maximum value of construction projects (US$525.6bn) in 2014 in the GCC followed by Saudi Arabia (US$407.8bn) while Oman accounted for US$29.6bn worth of projects last year.
According to the report construction activity in Oman's residential housing sector is driven by factors such as rapid urbanisation rising disposable incomes a fast growing middle class ease of availability of housing loans and low interest rates.
The GCC Construction Industry report says the key growth drivers in Oman's construction industry are population growth economic growth and increased focus on the tourism sector.
'Omani construction industry is expected to benefit from the demand arising out of its fast-growing population. The country is witnessing economic growth in light of government's plans for diversification industrialisation and privatisation. Oman's vision for 2020 lays emphasis on the development of its tourism sector' it said.
The report said ongoing efforts to reduce the dependency on hydrocarbons across the GCC have resulted in an increase of capital investment in the construction industry.
'The GCC construction industry foresees growth from 2015-2018 encouraged by factors such as favourable macroeconomics positive demographics and rising tourism activity. Higher budget allocation towards construction as part of the strategic vision of nations lends an added push to the industry' said Sameena Ahmad managing director Alpen Capital (ME).
The report however noted that the dip in oil prices may push GCC nations to restrict state spending hampering the growth of the construction industry which is materially dependent on government funding.
The opportunities available in the construction industry Alpen Capital said could be affected by lower investments from the private sector and plunging disposable income levels. Further lower tourist inflow from oil-dependent nations may hamper growth.
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