(MENAFN- The Peninsula) The Peninsula
DOHA: Overall sentiment in the GCC's construction sector has improved by approximately 7 per cent (from 32 percent to 39 percent), according to recent findings from Pinsent Masons' GCC Construction Survey.
Presented to industry professionals at the Construction and Engineering Law Conference, the report provides a snapshot of opinion from the GCC construction sector where majority of the companies are involved in projects with a value of over QR500m, despite ongoing concerns relating to delayed payment, the rising cost of capital and increased number of disputes.
The survey reveals that 16 percent of respondents believe that Qatar will provide the strongest opportunities for growth in 2018, bringing its overall ranking to third place in the GCC region.
Peter Blackmore, Head of Pinsent Masons Qatar, said, 'There is more optimism about improved market conditions in the GCC construction sector than we saw in 2016, though there are ongoing challenges with lower energy prices. However, in Qatar we expect activity levels to improve in the lead up to FIFA World Cup 2022.
While the survey indicates a slight rise in overall sentiment, the findings revealed that 20 per cent of those surveyed across the GCC expect their order books to decline by more than 10 per cent in the coming months, compared to 16 per cent two years earlier.
Asked about contract conditions, 86 per cent of businesses said they had become less favourable during 2017, representing a similar sentiment in 2016 which stood at 92 per cent.
In addition, a significant number of companies (86 per cent) said payment periods were longer in 2017 compared to the same time last year.
Finally, 67 per cent of respondents stated they were involved in more disputes during 2017 than had been expected before the year started, as opposed to 59 per cent in 2015.
'Whilst analysts predict a slight economic revival across many GCC markets during 2018, the survey results are indicative of what has been a challenging time for the construction sector - which has grappled with the impact of lower oil prices and ongoing geopolitical tensions, added Sachin Kerur (pictured), Head of Middle East Pinsent Masons.
In terms of sector types, close to 60 per cent of respondents believe power (including renewables) will offer the most opportunities during 2018.
Meanwhile, sentiment towards the real estate sector improved with 32 per cent of respondents expecting growth from this sector in 2018, compared to 25 per cent in 2016.
With Public Private Partnerships (PPPs) increasingly being used as a means of attracting more inward investment - especially in Qatar which is planning to implement a new law governing the use of PPPs - the survey revealed that more than one third (40 per cent) of respondents across the GCC are currently involved or expect to be involved in PPP projects during the next 12 months, up slightly from 32 per cent for 2016.
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