Construction sector in Qatar in 3.35% growth

Growth in Qatar’s construction industry is set to continue for the next two to three years according to Global Investment House as new projects continue

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By  Rhys Jones Published  September 11, 2004

The outlook for Qatar’s construction industry remains bright at least for the next two to three years, according to Kuwait-based Global Investment House (GIH). According to GIH, last year the sector grew at a rate of 3.35% compared with a negative growth of 3.1% in 2002. The sector represented 7.5% of total gross domestic product, making the third largest contribution to the total GDP among the country’s non-oil and gas sector in 2003. Owing to budget surpluses recorded in the last four years, the level of public spending has also increased. Public projects in sectors such as health, education, housing and infrastructure have been allocated QR8.8 billion in the 2004-2005 budget. Furthermore, the number of building permits issued also increased by over19% compared with single-digit growth in previous years. The number of building permits issued also grew to 4237 in 2002 from a base of 3556 in 2001. Qatar is witnessing an unprecedented boom in the real estate sector with an increase in investment opportunities throughout the construction sector. The economic boom and the increase in population have resulted in rent rising by 25% to 30%. Currently, the demand for residential units such as apartments and housing as well as hotel rooms in Qatar far exceeds supply. New hotels and residences will be constructed for the 2006 Asian Games to accommodate 10000 athletes and officials, 10000 non-athletes and estimated 150 000 spectators. After the games, developers with flexible complexes such as Al Dafna Towers will be able to adjust to market conditions. Major developments in Qatar include a project to build a new multi-purpose complex comprising covered markets, conference halls and theatres, which is expected to cost around QR 700 m. Other projects include the Pearl of the Gulf Island, which will be built 350 m offshore close to the West Bay district of Doha. GIH has also predicted that Qatar’s construction industry will continue to boom because of the increased allocation by the government in budget 2004-2005 for public projects such as health, education, housing and infrastructure, which will fuel the economic activities in almost every sector.

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