Middle East construction at a transition point
Digitalisation and sustainability are changing the way projects are planned and delivered in the Middle East and North Africa region
After a challenging 18 months, construction and infrastructure firms in the Middle East and North Africa (Mena) region continue to find their bearings.
In a market that is seeing change across a wide range of areas, including a growing awareness of environmental impact,localisation of content, and more stringent welfare requirements in response to Covid-19, the two biggest factors that are forcing project owners to reassess their development plans are climate change, and the long-term slowdown in demand for oil.
The drive to reduce carbon dioxide and other greenhouse gas emissions to hit the targets set out in the 2015 Paris Agreement is seeing governments demanding the decarbonisation of projects through a greener approach to building and infrastructure design, construction and delivery.
This approach is also evidenced by long-term strategies introduced in cities including Dubai, where the integrated Dubai 2040 masterplan priorities sustainability at the heart of its urban future.
Meanwhile, project clients are seeking greater social and economic value from their project investments, as the Covid-19 pandemic and lower oil prices squeeze balance sheets.
Private sector real estate investors and developers are delaying or downsizing their investment plans in response to declining demand for many asset classes, while governments are seeking to reduce their capital spending commitments through alternative delivery mechanisms such as public-private partnerships (PPP), on critical infrastructure projects.
The key to achieving these objectives is the digital transformation of construction, engineering and operation of projects in the region. A call for greater use of advanced building information modelling (BIM) by project clients is forcing designers, contractors, suppliers and end-user operators to integrate information through cloud-based digital twins. The earlier engagement of downstream contractors, suppliers and operators in design that this enables will reduce on site clashes and late-stage variations that lead to delays and disputes.
The drive to reduce mistakes and improve safety will see increasing adoption of modular construction techniques, while the development of sensor technology in combination with artificial intelligence will enable real time monitoring of assets during construction and operation, allowing for more efficient utilisation of the asset, more efficient maintenance procedures, and optimisation of services.
With some $3.3tn of major projects planned across the Mena region, the pipeline of future projects is bigger than the $3.1tn combined value of all of the project contracts awarded in the region since 2004. So the potential for the region’s incredible growth story to continue is immense. However, unlocking that opportunity depends entirely on the ability of the region’s projects industry to deliver its digital transformation.
The latest report from Oracle Construction and Engineering, in partnership with MEED, considers the transformation underway across industries in the Mena region, featuring insights from leading thought-leaders and disruptive companies.
Download the report below.