Kuwait Construction Market - Growth, Trends, COVID-19 Impact, and Forecasts (2022 - 2027)

The Kuwaiti Construction Market is Segmented by Sector (Commercial, Residential, Industrial, Infrastructure (Transportation Construction), and Energy and Utility Construction).

Market Snapshot

Kuwait Construction Market Summary
Study Period: 2018-2027
Base Year: 2021
CAGR: >6 %
Kuwait Construction Market Major Players

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Market Overview

The Kuwaiti construction market is projected to register a CAGR of approximately 6% during the forecast period (2022-2027).

The COVID-19 pandemic and the drop in oil prices took a severe toll on Kuwait’s economy and construction industry in 2020. The major factor driving the Kuwait Construction Market will be Kuwait’s tax reforms that are encouraging foreign investors to invest in the country. They are giving benefits like income tax holidays and customs-free equipment importation. The country is hoping to attract more foreign investment.

The government is focusing on increasing oil production to generate greater revenue, and an improvement in government finances will enable the government to increase public spending on infrastructure. In June 2021, the government approved the Financial Year 2021-22 state budget, which allocated KWD 19.6 billion (USD 64.6 billion) to 19 strategic projects, including the Sabah al-Salem Kuwait University City, Kuwait International airport expansion, Al-Mutlaa residential city project, and the railway network plans, among others.

Scope of the Report

The construction market includes a wide range activity that covers upcoming, ongoing, and growing construction projects in different sectors. The Kuwaiti Construction Market is segmented by sector: Commercial Construction, Residential Construction, Industrial Construction, Infrastructure (Transportation Construction), and Energy and Utility Construction. The report also covers the impact of COVID-19 on the market.

BY SECTOR
Commercial Construction
Residential Construction
Industrial Construction
Infrastructure (Transportation Construction)
Energy and Utilities Construction

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Key Market Trends

Vision 2035: The Key Driving Factor for the Construction Sector during the Review Period

The sustainable living environment axis in Kuwait Vision 2035 includes five pillars, the most prominent of which is to provide housing care to citizens through what is planned, to ensure the provision of 65.5 thousand housing units through five projects costing about KWD 3.22 billion (USD 10.5 billion), the last of which ends by 2029.

When the implementation of these projects is completed, the state will have met approximately 72% of the current housing requests, which stands at 91,000. The first project of the residential care plan revolves around the vision of Kuwait 2035 (New Kuwait) in the city of Jaber Al-Ahmad, which has a completion rate of 95% and will end at the end of 2022. The second project is in the city of Al-Mutla’a, which has a completion rate of 64%, to be completed by the end of 2023.

The third project is in the suburb of South Abdullah Al-Mubarak, which has a completion rate of 72% and will be completed by the end of 2025. The completion rate in the fourth project, which is the South Sabah Al-Ahmad, is about 14%, as it is still in the preparation stage, while it is expected to be completed in 2029. This south of Saad Al-Abdullah has a completion rate of 13% as it is still in its preparatory phase and ends in 2029.

Kuwait Construction Market - Key Housing Construction Projects in Kuwait 2021, Value in USD Billion

Investments in Large-scale Projects to the Boost the Construction Sector in Oman

Kuwait’s infrastructure sector is a leading sector. The country’s development plan (2020-2025) focuses on economic reform and implementation of numerous long-stalled megaprojects, with several large infrastructure projects estimated at USD 124 billion. It includes a number of infrastructure upgrades such as the USD 7 billion Kuwait City Metro, a rail project that will eventually link all GCC countries, a USD 4 billion new airport, five new planned cities, including Silk City/Northern Economic Zone, further development of the Mubarak Al-Kabeer Port on Boubyan Island, and a large number of mega oil projects, including a new refinery that is still under construction. The government is working on over USD 4 billion worth of hospital projects as part of its plan to boost the bed capacity of hospitals across the country.

Project implementation has seen frequent delays, especially with large infrastructure projects. The government itself acknowledged that only 10 projects out of 135 projects included in the 2015-2020 five-year development plan were completed. With 81 projects delayed and four projects yet to be tendered, those projects were included in the five years development plan (2020-2025). The projects are expected to move slowly due to the current budget situation.

Kuwait Construction Market - Key Infrastructure Projects in Kuwait, 2020-2025, In USD Billion

Competitive Landscape

The Kuwaiti construction market is highly competitive, with the presence of major international players. The market presents opportunities for growth during the forecast period, which is expected to further drive market competition. With a few players holding a significant share, the Kuwaiti construction market has an observable level of consolidation. Some of the major players include JGC Corporation, SNC-Lavalin Group, Fluor Corporation, Van Oord Dredging & Marine Contractors BV, and VINCI.

Major Players

  1. JGC Corporation

  2. SNC-Lavalin

  3. Van Oord Dredging & Marine Contractors BV

  4. Fluor Corp.

  5. Hyundai Engineering & Construction Co. Ltd.

Kuwait Construction Market Concentration

Recent Developments

March 2022: The construction of the GCC railway network connecting Qatar to neighboring Saudi Arabia is expected to begin soon. All necessary groundwork to implement the grand project has been completed, including the detailed engineering designs and work plan. The 2,177 km long Gulf Railway is a proposed railway system that will connect all six of the GCC countries in Eastern Arabia. The project is expected to cost USD 250 billion, which will be shared by the six countries, in accordance with the length of the rail network in their territories.

March 2021: Egypt and Kuwait intend to create a joint venture that will initially pump nearly USD 318 million into the construction and real estate sectors in Egypt. The new venture, to be named “Modon” (cities), will be announced by the Egyptian-Kuwaiti Company (EKC), which will own the new venture.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Scope of the Market

    2. 1.2 Market Definition

    3. 1.3 Executive Summary

  2. 2. RESEARCH METHODOLOGY

    1. 2.1 Study Deliverables

    2. 2.2 Study Assumptions

    3. 2.3 Analysis Methodology

    4. 2.4 Research Phases

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET INSIGHTS

    1. 4.1 Current Economic and Construction Market Scenario

    2. 4.2 Technological Innovations in the Construction Sector

    3. 4.3 Impact of Government Regulations and Initiatives on the Industry

    4. 4.4 Mapping of Industrial Clusters and SEZs and a Brief Analysis of Investment Opportunity

    5. 4.5 Review and Commentary on the Extent of Kuwait's Economic Diversification

    6. 4.6 Comparison of Key Industry Metrics of Kuwait with Other GCC Member Countries (Analyst View)

    7. 4.7 Comparison of Construction Cost Metrics of Kuwait with Other GCC Member Countries (Analyst View)

    8. 4.8 Impact of COVID-19 on the Market

  5. 5. MARKET DYNAMICS

    1. 5.1 Drivers

    2. 5.2 Restraints

    3. 5.3 Opportunities

    4. 5.4 Porter's Five Forces Analysis

    5. 5.5 Industry Value Chain Analysis

  6. 6. MARKET SEGMENTATION AND ANALYSIS

    1. 6.1 BY SECTOR

      1. 6.1.1 Commercial Construction

      2. 6.1.2 Residential Construction

      3. 6.1.3 Industrial Construction

      4. 6.1.4 Infrastructure (Transportation Construction)

      5. 6.1.5 Energy and Utilities Construction

  7. 7. COMPETITIVE LANDSCAPE

    1. 7.1 Market Concentration Overview

    2. 7.2 Strategies Adopted by Major Players

    3. 7.3 COMPANY PROFILES

      1. 7.3.1 JGC Corp.

      2. 7.3.2 SNC-Lavalin

      3. 7.3.3 Fluor Corp.

      4. 7.3.4 Van Oord Dredging & Marine Contractors BV

      5. 7.3.5 VINCI

      6. 7.3.6 Jacobs

      7. 7.3.7 Combined Group Contracting Co.

      8. 7.3.8 ECC

      9. 7.3.9 Hyundai Engineering & Construction Co. Ltd

      10. 7.3.10 Kuwait Contracting and Processing Co. (KCPC)

      11. 7.3.11 Mushrif Trading & Contracting Co.

      12. 7.3.12 Kharafi Group

      13. 7.3.13 Gulf Dredging

      14. 7.3.14 Sayed Hameed Behbehani & Sons*

    4. *List Not Exhaustive
  8. 8. INVESTMENT ANALYSIS

  9. 9. MAJOR INFRASTRUCTURE DEVELOPMENT PROJECTS (PROJECT DESCRIPTION, VALUE, LOCATION, SECTOR, AND CONTRACTORS)

    1. 9.1 Existing Infrastructure

    2. 9.2 Ongoing Projects

    3. 9.3 Upcoming Projects

  10. 10. FUTURE OF THE CONSTRUCTION SECTOR IN KUWAIT

  11. 11. APPENDIX

  12. 12. DISCLAIMER

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Frequently Asked Questions

The Kuwait Construction Market market is studied from 2018 - 2027.

The Kuwait Construction Market is growing at a CAGR of >6% over the next 5 years.

JGC Corporation, SNC-Lavalin, Van Oord Dredging & Marine Contractors BV, Fluor Corp., Hyundai Engineering & Construction Co. Ltd. are the major companies operating in Kuwait Construction Market.

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