The return on buildings as a proportion of GDP in Saudi Arabia is one of the lowest among major economies but should rise sharply in the years to 2022, according to an expert.

Speaking at the recently concluded annual MEED Saudi Mega Transport and Infrastructure Conference, Arcadis Hisham Al Malaika, head of property and social infrastructure in Saudi Arabia, said: “Saudi Arabia’s return on built assets is relatively low. We also have a huge issue in the quality of the infrastructure we are building in Saudi Arabia.”

Al Malaika completed a study into the returns on built assets on a total of 30 countries, including Qatar, Saudi Arabia and the UAE.

“The UAE was ranked seventh among the 30 countries in terms of return on built assets as a proportion of GDP. Saudi Arabia ranked 29th,” he said.

The return on built assets would be lifted by paying greater attention to planning, procurement, operations and maintenance and replacement and renewal of built assets, he stated.

Meanwhile, international construction companies have been advised to choose their projects in Saudi Arabia carefully to avoid the manpower and materials shortages that are currently blighting many schemes across the kingdom.

Experts warned contractors to work smartly to avoid the possibility of having massive losses on mega projects due to overextending their operations, at a construction leaders’ panel organised at the event.

Saudi Arabia’s Deputy Minister of Labour Affairs will detail the present and potential contribution to Saudi Arabia’s growth in local employment within the construction and project delivery industry to 2025.

Another session will focus on funding and financing for Saudi Arabia’s $70 billion worth of megaprojects, with experts identifying which mechanisms are available for financing mega transport and infrastructure projects, as well as the extent of financing need to support the Kingdom’s long-term projects requirements. - TradeArabia News Service