Middle East: Despite low oil prices affecting investment in infrastructure, nations with secure business environments, stable financial sectors and strong growth potentials, such as Qatar and the UAE, still remain attractive markets for infrastructure investors, according to a report by Arcadis, a global design and consultancy firm.
The report’s findings revealed that Saudi Arabia has dropped three places to 15th, due to a decline in the relative size and dynamism of the market and the impact of relatively low infrastructure scores.
The consultancy firm’s Global Infrastructure Investment Index, which contains the findings, is published every two years, and ranks 41 countries by their attractiveness to investors in infrastructure, in order to gauge their appeal, Arcadis informed.
Despite infrastructure being a long-term investment, Arcadis’ third Global Infrastructure Investment Index highlighted that short-term factors, such as currency devaluations, commodity prices and security issues, could be a barrier to investment. Given these issues, it pointed out, nations like the UAE, which have traditionally funded infrastructure through the public sector, are opening up to private finance, which could bridge the funding gap for the development of much-needed new infrastructure, including the extension of Dubai’s metro.
“Priorities for Qatar include, new systems for transportation and improving the country’s connectivity,” said Sameer Daoud, Middle East Leader – Infrastructure, at Arcadis. “A new port has been developed, in part, to support the import of materials needed to deliver ambitious spending plans that satisfy both the 2030 National Vision and the more immediate 2022 FIFA World Cup Qatar. Opportunities are more likely to be in the operation and maintenance of existing assets, as the government continues to ensure that its infrastructure remains of a high standard.”
Daoud believed that despite a fall in Saudi Arabia’s ranking this year, the country has growth potential, as the government has recently announced its Vision 2030 reform plan, in an attempt to free its dependence on oil exports.
Ben Khan, Middle East Client Development Director at Arcadis said: “Whilst opportunities have been limited in the region due to falling export revenues, as we see more GCC countries opening up to private finance, this can create opportunities for investors in the short- to medium- term.”
As per the report, the top 10 most attractive countries for long-term infrastructure investment in 2016 are:
|Rank||Country||Change from 2014|