GCC project frenzy
Posted: 27 February 2006
 Send this article
 Print this article
Due to the increasing role of the private sector and the rapid rise in privatisations, projects in the GCC are expected to double this year, experts in project finance forecast.
 Some caution, however should be taken by considering the cynical nature of the market, urged MEED Conference chairman Edmund O’Sullivan.
He said although the GCC market has been buoyant, some industry analysts have predicted a slow down in the rate of growth – currently reaching 25 per cent - over the next couple of years.
“Markets are cyclical, and we have been through downturns in this market. There has to be a slowdown, though projects will continue to be economically viable due to regional factors such as the price of oil,” he added.
The rapid growth will also put GCC in a “project frenzy”, which will test the skills of local banks, and the appetite of foreign lenders.
Ram Chandran, Head of International Banking for Commercialbank, said: “The project finance needs of the region will present enormous financing and capital market opportunities. It will also bring about challenges for the regional banks, which are already aggressively competing with global banks for market share and higher fee income at senior levels.”
Growing market
The Middle East has the second largest share of project finance in the world with an industry worth $100 to $150 billion globally. Qatar alone has massive natural wealth, holding over 900 trillion cubic feet of gas.
Steve Martin, head of corporate communications and marketing for Qatar Financial Centre Authority, said: “Currently, there are more than $130 billion worth of projects on the table, driven by the government’s initiative to promote public and private sector co-operation. Projects in the oil and gas sector in Qatar amount to more than $60billion, including RasGas Onshore Expansion Project Trains, which are expected to produce 15.6 million tonnes of liquefied natural gas (LNG) per year.”
Martin was quoted speaking in advance of MEED’s Middle East Project Finance, to be held in Doha on 28 February – 1March.
Project finance opportunities abound through the rest of the region. In the UAE, growth is being led by Abu Dhabi, where the mobilisation of the private sector – which currently contributes 40 per cent of Abu Dhabi’s economy – will result in an upward curve in GDP.
In Oman, the value of projects currently on stream is estimated at $30 billion.
Posted by Editor Pipeline Magazine
Information supplied by companies
or PR agencies who are responsible for content. Send press releases
to info@pipelinedubai.com |
