UAE leads GCC project market in Q2 despite dip, outlook remains bright for 2025
According to the latest data from MEED Projects and Kamco Invest, the UAE emerged as the region's top project market in the second quarter of the year, overtaking Saudi Arabia, despite a year-on-year drop in awarded contracts.
The UAE recorded $14 billion worth of contract awards in Q2-2025, down from $26.4 billion in the same period last year — a 47 per cent decline. However, its share of the GCC project market rose to 49.2 per cent from 38.9 per cent in Q2-2024, highlighting the resilience and attractiveness of the UAE's diversified project portfolio.
'The UAE's ability to retain its lead in the region despite a sector-wide slowdown reflects its strategic investment push, policy reforms, and continued focus on economic diversification,' said Mohamed Ali Omar, associate at Kamco Invest.
In contrast, Saudi Arabia posted a sharp 72.5 per cent year-on-year drop in Q2 contract awards, reaching $9.8 billion compared to $35.6 billion in Q2-2024. Overall, the GCC recorded a steep 58 per cent drop in Q2 contract awards, with total awards falling to $28.4 billion from $67.7 billion a year earlier — the lowest quarterly figure in 14 quarters.
The decline was broad-based, with five of six GCC nations posting lower project awards in the second quarter. The slowdown comes after two years of record spending on mega oil and gas developments and over $1 trillion in gigaprojects. According to Junaid Ansari, head of Investment Strategy and Research at Kamco Invest, 'The slowdown is a cyclical correction after an extended period of robust activity. We expect a revival in the second half as several high-value projects enter the execution phase.'
In terms of first-half 2025 performance, UAE contracts totalled $44.4 billion, down 12.1 per cent from $50.6 billion in H1-2024. The largest hit was in the construction sector, which saw a 61.6 per cent drop to $4.9 billion. Yet, the gas sector proved to be a bright spot, with $5.3 billion in awards, accounting for 37.6 per cent of the UAE's Q2 total.
Among the standout deals was a $400 million three-year LNG supply agreement between Adnoc Gas and Germany's SEFE. Separately, Adnoc Gas announced a $5 billion investment in its Rich Gas Development Scheme, with the first $2.8 billion tranche awarded to UK-based Wood for the Habshan facility. Petrofac and Kent were also awarded major packages for Das Island and Asab-Bu Hasa facilities, respectively.
The industrial and chemical sectors in the UAE also showed signs of growth. The industrial sector saw a 35.8 per cent year-on-year rise in Q2 awards, while the chemical sector rebounded with $150 million in new contracts after no awards in the year-ago quarter.
Looking ahead, Saudi Arabia's pipeline includes mega projects such as the $80 billion CARE nuclear power reactor and a $10 billion battery energy storage system. These projects are currently in the bidding or FEED (front-end engineering design) stages and are expected to boost contract activity later in the year.
As of mid-2025, the GCC's pre-execution pipeline of contracts is valued at approximately $1.73 trillion. Of this, Saudi Arabia accounts for over 50 per cent at $873.2 billion, followed by the UAE at $417.9 billion, or 24.2 per cent. Kuwait ranks fourth with $114.8 billion, or 6.6 per cent of the regional total.
Segment-wise, the pipeline includes $586 billion in the design stage, $625.5 billion in the study phase, $133.9 billion in pre-qualification, $106.3 billion in bidding, $162.6 billion in bid evaluation, and $115.2 billion in FEED.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Khaleej Times
an hour ago
- Khaleej Times
UAE: Stablecoin regulations encourage more users explore digital assets safely
Experts are optimistic the recent signing by US President Donald Trump of the Genius Act — creating a regulatory regime for dollar-pegged cryptocurrencies known as stablecoins — will not only give users the confidence to explore digital assets safely but will also draw more users in the UAE, especially newcomers, to crypto by making stablecoins safer and more mainstream for payments and decentralised finance (DeFi). The stablecoin market, which crypto data provider CoinGecko said is valued at more than $260 billion (Dh954 billion), could grow to $2 trillion (Dh7.3 trillion) by 2028 under the new law. It's a milestone that could pave the way for digital assets to become an everyday way to make payments and move money, experts told KT LUXE. The regulatory framework is also seen as a big leap from the time of 'speculative chaos' when stablecoin first came into being back in 2009. The UAE has also moved forward with regulations of AED stablecoins, noted Meera Judge, director, regulatory licensing and policy at Binance. 'When people feel safe, they're more likely to participate. Clear rules create room for innovation — and that's where we see real adoption start to take shape,' she said. Regulations serve as important guardrails, with enhanced transparency serving as the key factor in consumer protection. They build confidence and encourage people who might have been hesitant to explore crypto as a real option for diversifying their finances. In December last year, AE Coin secured the final Central Bank of the UAE (CBUAE) licence it needed to launch. It was developed under the CBUAE's digital payment token services framework for instant, secure, stable, innovative, low-cost, and efficient payment experience. 'The UAE's AED-backed stablecoin is a really exciting milestone. It shows how seriously the UAE is taking decentralised finance and its future role in global financial innovation. This isn't just about creating another stablecoin, it's a clear signal of the UAE's commitment to building a regulated, forward-thinking crypto ecosystem that can compete on the world stage,' Judge said. A constant Stablecoins are designed to maintain a constant value. For the UAE, its focus on a local fiat-backed stablecoin also reflects a regional ambition to diversify beyond the dominance of the USD stablecoins, which have long been the industry's gateway. This is very positive for the country as it is not only about necessity but also about creating opportunity. Judge explained: 'Local fiat stablecoins (like AE Coin) reinforce the seriousness with which countries are approaching crypto regulation and innovation. They help tailor financial tools to regional needs, supporting local businesses and consumers while promoting financial inclusion. 'Moreover, having a wider range of fiat-backed stablecoins contributes to a more diverse and resilient ecosystem, a key step toward making crypto relevant and accessible to people everywhere, not just in dollar-dominated markets,' Judge added. Gracy Chen, CEO of Bitget, shared the same analysis, and optimism that stablecoins will draw more users, especially newcomers. She told KT LUXE: 'The UAE's AED stablecoin regulations, effective June 2025, focus on local currency stability and centralised oversight by the Central Bank, while the US Genius Act targets USD-pegged stablecoins with a dual federal-state framework. Regional trade 'Both aim to enhance trust and adoption, but the UAE emphasises regional financial sovereignty, unlike the USD-centric US approach. Non-USD stablecoins like AED-backed tokens are crucial for regional trade, reducing USD reliance, and catering to local markets, driving global crypto diversity. Supporting AED stablecoins can attract MENA users, while USD stablecoin compliance ensures broader market access,' Chen explained. She added bank-backed USD and AED stablecoins promise faster, cheaper transactions, boosting liquidity, but may challenge existing tokens like USDT (Tether), increasing compliance costs for exchanges. 'This could lead to market concentration, potentially limiting innovation, while subjecting exchanges to stricter regulatory scrutiny.' Chen also pointed out the entry of major US banks (JPMorgan, Bank of America, Citigroup, Wells Fargo) and UAE banks (FAB, MBank, Zand Bank) into the stablecoin market will enhance crypto legitimacy, driving adoption and trading volumes on exchanges.
The National
9 hours ago
- The National
How the climate crisis is creating millions of refugees in the Middle East
• Remittance charges will be tackled by blockchain • UAE's monumental and risky Mars Mission to inspire future generations, says minister • Could the UAE drive India's economy? • News has a bright future and the UAE is at the heart of it • Architecture is over - here's cybertecture • The National announces Future of News journalism competition • Round up: Experts share their visions of the world to come
The National
9 hours ago
- The National
UAE Property: ‘How can I increase summer occupancy in my RAK rental unit?'
Question: I am buying an apartment in Ras Al Khaimah and want to rent it out for short-term rentals soon. How can I optimise summer occupancy and which local regulations must I adhere to? MP, Dubai Answer: Ras Al Khaimah is fast becoming a destination of choice, not just as a go-to staycation destination for the UAE holiday market, but also for longer-term visitors and tourists. With the arrival of the Wynn Al Marjan Island resort in 2026/2027, the emirate is likely to become more popular as a short-term destination. Here are a few things to remember and adhere to. By law, all tenancy contracts in RAK must be registered through the RAK Municipality e-portal. The fee is Dh25 ($6.8) plus 5 per cent of the annual rent. Unregistered contracts are unenforceable, stripping landlords of eviction rights and security deposit recourse. Standard residential leases are allowed up to four-year terms, but short-term leases of say two to four months must still comply with the Rent Act's eviction notice requirement, which is a minimum 90 days, and the security deposit rule, which is 5 per cent of the annual rent. Offer two- to four-month summer lets bundled with free utilities, complimentary AC servicing and optional maid services. UAE residents that enjoy staycations value turnkey, worry-free stays. List on leading short-let platforms such as Airbnb, local short-term rental agents and collaborate with GCC-focused travel agencies to tap into regional leisure traffic. Ensure your unit is presented in the best possible fashion by furnishing with high-quality appliances, blackout curtains, high-speed Wi-Fi, and a dedicated workspace to attract both families and remote working professionals seeking respite from the summer heat. Employ revenue management software to adjust nightly or weekly rates based on occupancy forecasts or get comparable data from portals and local holiday home agents. Look out for any local events that will potentially capture higher premiums. Conduct professional cleaning and safety inspections between tenancies to maintain high review scores. Offer flexible check-in/out times and transparent cancellation policies to build guest trust. Monitor competitor rates regularly to ensure your pricing remains competitive without eating into your yield. By combining regulatory compliance with targeted marketing and professional service levels, part-time RAK landlords can boost summer occupancy from roughly 45 per cent (unmanaged) to over 75 per cent, capturing premium short-let rates and maximising annual income. Watch: Businesswoman moves from Dubai to RAK to find some quiet Q: I would be interested to understand what are the emerging areas in Abu Dhabi and Sharjah in terms of capital appreciation, rental yields and which developers I should work with? CP, Sharjah A: While Dubai commands the headlines, Abu Dhabi and Sharjah are quietly delivering attractive risk-adjusted returns in well-priced, master-planned communities. I will list below some top picks that I think combine credible developer track records, infrastructure momentum and balanced capital appreciation. Starting with Abu Dhabi, the main master developer is Aldar. Some of its main projects are: Al Reem Island: Boasting a 7.2 per cent year-on-year price rise in the first quarter of 2025 and gross rental yields of 7.6 per cent for apartments, Al Reem Island blends waterfront views with high-street retail. The Central Market and Gate Towers precincts have strong presales, minimising completion risk and ensuring pipeline transparency. Yas Island: Driven by entertainment megaprojects such as Warner Bros, Ferrari World, Sea World, Yas Waterworld and the Yas Mall expansion, luxury apartments command 6.5 per cent to 7 per cent yields, with prices up 6.6 per cent in early 2025. The upcoming first Disney World in the Middle East will further elevate property prices and demand for both long- and short-term rentals. Al Ghadeer: A reclaimed land community by Aldar located on the Dubai-Abu Dhabi border, it offers entry-level pricing (sub-Dh1 million studios) and yields near 9.9 per cent, underpinned by affordable payment plans and infrastructural upgrades connecting to Sheikh Mohammed Bin Zayed Road. Main projects in Sharjah include: Aljada by Arada: This is a fully integrated town centre featuring three schools, 25,000 residential units, a 4.4-kilometre retail boulevard, hotels and public plazas, along with large green spaces and family entertainment areas. Aljada's off-plan apartments yield 5 per cent to 7 per cent, with an expected 7.5 per cent return on investment on handover. Arada's track record of delivering three large-scale projects on time adds to investor and end-user confidence. Tilal City (Sharjah Asset Management): Modelled on Mediterranean lagoons, Tilal City's early studio and one-bedroom launches delivered 6 per cent to 8 per cent yields, with mid-teen capital growth forecast as schools, clinics and malls open next year. Maryam Island: Launched in 2024, this waterfront mixed-use island has seen soft-launch price uplifts of around 8 per cent within six months and yields of around 6 per cent. This is driven by Sharjah's tourism push and the project's proximity to the Corniche.
