You are currently browsing the category archive for the ‘Construction’ category.
Per an IMF analysis from late last month, Morocco’s economic outlook will improve in 2010, while still “remain[ing] dependent on external developments” such as potential Euro-zone growth–Morocco’s principal trading partner. The country’s GDP, which was rising at about a 5% clip pre-crisis, should grow by roughly 4% next year on the back of internal demand, and specifically in agriculture, the largest component of the domestic workforce. Moreover, exports should be boosted by the phosphate rock mining and processing industry, which accounts for almost one-third of the nation’s exports and whose YOY exports dived by over one-half over the first half of 2009. On that front, earlier this week, Bohdan Danylyshyn, head of the Ukrainian Economy Ministry, suggested a partnership of sorts between the two, stating that his country was “interested in geological exploration, the modernization of equipment for phosphate deposit development, and importing phosphates from Morocco,” while also noting that “Ukrainian companies would like to participate in the reconstruction of various types of industrial facilities on the territory of Morocco.”
Morocco is the third-biggest phosphate producer in the world after China and the U.S., with 28 million tons of output a year. It is the largest phosphate exporter, with a 31.6% market share. And although production is controlled by a state-owned OCP–which earlier this year announced that it expected to increase its phosphate output to 45-55 million tons by 2020 on the back of its planned investment–the industry’s growth for Morocco may in practice translate over to other domestic industries, where demand is driven by domestic wealth measures such as property and construction that are themselves a function of the health of domestic exports. The demand for cement is expected to grow going forward on the back of a young demographic, state-backed social housing projects and a resumption in commercial real estate projects.
In upgrading Orascom Construction Industry (OCI)–Egypt’s largest listed builder and also the country’s biggest producer of nitrogen fertilizers–local investment bank CI Capital noted that the firm’s net EBITDA is largely a function of fertilizer prices, which most analysts expect to rise up to a further 40% in 2010. “We believe OCI’s 2010 fertilizer margins will be supported by a number of factors, including fertilizer price increases, the establishment of strategic alliances with global fertilizer distributors and production capacity growth,” CI’s report stated, while forecasting an increase in earnings for the company from $427.8m in 2009 to $668.9m in the coming year.
Sticking with OCI, last month Citigroup name the company as one of its twelve “long-term” emerging market plays. “The construction company enjoys many long-term qualifications. Its construction division dominates approximately 2.5% of total developments under construction in the GCC region. The division also grows at an annual rate of 25%,” the bank reported.
According to Trade Arabia, a news source, the Qatar construction sector is poised to grow by 17.6% YOY in 2009, as “gas revenues continue to provide the country with ample funds to re-invest into infrastructure development and construction projects.”
A byproduct of this trend will be a “spillover” into the country’s real estate market, which contributes roughly 10% to Qatar’s GDP, theorizes Muteab Al-Sa’aq, chairman of Trance Continent, a trade-show organization.
In addition to housing units and public installations, Qatar has also seen growth in office space market due to increased demand among global oil and gas companies, the banking and financial services sector, and government ministries and agencies, [Al-Sa’aq] pointed out. Growing tourism has also prompted Qatar to invest in the development of hotels and resorts, with figures released by the Qatar Tourism and Exhibitions Authority (QTEA) estimating a total investment of $17 billion into tourism infrastructure to support the anticipated 400 per cent rise in hotel capacity by 2012. Al Saaq said brand new residential towers were being delivered in and around Doha, with projections of 9,000 new apartments to be available by 2010, while 80,000 new hotel rooms will be finished by 2016. Development at this astounding pace is precedent to the potential of Qatar’s property market despite the challenge of the present economic slowdown. As correction envelopes the region’s real estate sector, “we are expecting Qatar to lead the way as the centre of development for major industries in the Middle East,” he added.