2013-12-14 10:15:16 - New Construction market report from Business Monitor International: "Bahrain Infrastructure Report 2014"
With no end in sight to Bahrain's protracted political crisis we see little chance of a meaningful construction industry recovery materialising over the near term. Persistent political uncertainty will likely see private sector investment into new projects remain weak and continue to undermine industry growth. Public spending and multilateral funding will offer some crucial support, but this will be insufficient to offset another disappointing year - BMI forecasts industry growth of negative 0.7% in 2014.
Key developments in the sector:
* There has been a worrying uptick in violent incidents through the latter half of 2013 (most recently the death of a policeman in a bomb explosion on September 18 2013) and the government has made little headway in reaching an
agreement with the opposition. Indeed, the arrest of a prominent opposition politician on September 17 2013, under charges of inciting youth violence and trying to overthrow the government, further underscores the absence of positive progress in Bahrain's political risk environment. The uncertain political outlook continues to weigh heavily on the performance of the construction sector and until a resolution is found, this trend is likely to continue.
* In light of subdued private sector activity, investment will remain primarily government-driven and is likely to focus predominantly around a number of large-scale industrial projects, including the US$4.8bn expansion and modernisation of state-run Bahrain Petroleum's refinery; a new US$2.2bn production line at Aluminium Bahrain; a US$1.2bn expansion by Gulf Petrochemical Industries; and plans to expand Bahrain International Airport.
* In May 2013, Housing Minister Basem Al Hamer announced government plans to spend US$7.9bn on housing units by 2017, in an effort to address a waiting list officially estimated at 53,000 households (out of a total population of 1.2mn). In July 2013, Transport Minister Kamal bin Ahmed announced that five firms have been assigned to study a proposed railway linking Bahrain and Saudi Arabia, set to run parallel to the King Fahd causeway (which suffers from traffic congestion). Government plans to spend US$7.9bn on housing units by 2017 should also be a source of value creation for the sector.
* Bahrain is currently making sizable investment in its' upstream oil sector in order raise output and we expect these developments to increase demand for auxiliary construction services. Bahrain's Prime Minster Khalifa bin Salman Al Khalifa recently called for the country to redouble its efforts to increase oil and gas production. The government plans to boost production to 100,000b/d by the end of the decade, from 50,000bpd currently.
* The real estate sector is increasingly showing signs of normalisation: a report published in July by CRBE, an international real estate services firm, highlights the 'first small signs of recovery', with a number of new developments announced in the residential market over Q2. In the investment sector, CRBE notes that 'the realisation that the market has 'bottomed out' seems finally to have stimulated the thoughts of those investors who have been waiting for several years for a 'bargain. However, the prime office market continues to see little activity, while housing rental rates remain subdued.
Full Report Details at
- www.fastmr.com/prod/723539_bahrain_infrastructure_report_2014.as ..
Report Table of Contents:
BMI Industry View
- Infrastructure SWOT
- Construction And Infrastructure Forecast Scenario
- Table: Bahrain Construction And Infrastructure Industry Data
- Table: Bahrain Construction And Infrastructure Industry Data, 2018-2023
- Transport Infrastructure - Outlook and Overview
- Table: Major Projects - Transport
- Energy and Utilities Infrastructure - Outlook and Overview
- Table: Major Projects - Energy and Utilities
- Residentia/Non-Residential Building - Outlook and Overview
- Table: Major Projects - Construction and Social Infrastructure
Industry Risk Reward Ratings
- Bahrain - Infrastructure Risk/Reward Ratings
- MENA - Infrastructure Risk/Reward Ratings
- Table: MENA Infrastructure Risk / Reward Ratings
- Competitive Landscape
- Abdulla Ahmed Nass Group
- Table: Abdulla Ahmed Nass Group
- Ahmed Mansoor Al-A'ali
- Table: Key Statistics
- Consolidated Contractors Company (CCC)
Global Industry Overview
- Table: Latin America PPP Round-Up
- Industry Forecast Methodology
- Sector Specific Methodology
- Risk Reward Rating Methodology
- Sector Specific Methodology
- Table: Infrastructure Risk Reward Rating Indicators
- Table: Weighting Of Indicators
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