Saudi Arabia’s construction market recorded the largest overall y-o-y decline in the GCC, dropping by USD 34 bn, according to Meed projects data.

The decline is most visible in Saudi gigaprojects, where only USD 4 bn in contracts were awarded in the first five months of 2025, down from USD 25 bn in the same period last year, after it peaked in the first five months of 2023 at USD 33 bn. Only Diriyah Company and Roshn Group have awarded major contracts so far this year, Meed added.

The market is now struggling to absorb more than USD 600 bn of work awarded over the past three years, along with cost overruns and weak foreign investment, prompting the government to reassess its priorities, particularly as it focuses on delivering time-sensitive events like Expo 2030 and the 2034 Fifa World Cup.

Part of a regional trend: The GCC construction market fell by c. 40% y-o-y over the same period, with only USD 67 bn awarded contracts across the Gulf, down 39% from USD 110 bn in the first five months of 2024. The sharpest y-o-y declines were found in the construction and oil sector, with all sectors, except power and petrochemicals, also down. The UAE slightly fell below its 2024 figures, while Kuwait was the only Gulf country not to experience a decline.

The drivers: The decline is attributed to the completion of the planned large-scale oil and gas projects and the reported reforms and recalibration of the other gigaprojects. Falling oil prices and new US tariffs have also contributed to a loss of momentum following two years of record spending, the financial publication added.

DATA POINT- Bloomberg estimates that gigaprojects like Neom and major events like the World Expo 2030 and the Fifa World Cup in 2034 could cost nearly USD 2 tn. Rising deficits, falling oil revenues, and mounting borrowing might curb the Kingdom’s ability to meet targets, the business news service argued.

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