{"id":101430,"date":"2025-10-14T00:00:00","date_gmt":"2025-10-14T00:00:00","guid":{"rendered":"https:\/\/enterpriseam.com\/ksa\/2025\/10\/14\/saudis-project-awards-cool-in-3q-driving-regional-decline\/"},"modified":"2025-10-14T00:00:00","modified_gmt":"2025-10-14T00:00:00","slug":"saudis-project-awards-cool-in-3q-driving-regional-decline","status":"publish","type":"post","link":"https:\/\/enterpriseam.com\/ksa\/2025\/10\/14\/saudis-project-awards-cool-in-3q-driving-regional-decline\/","title":{"rendered":"Saudi\u2019s project awards cool in 3Q, driving regional decline"},"content":{"rendered":"

Saudi Arabia\u2019s projects market saw a 34.8% y-o-y drop in contract awards in <\/strong>3Q 2025<\/strong>, with the value of new agreements falling to USD 28.1 bn from USD 43.1 bn a year earlier, according to Kamco Invest\u2019s latest GCC Projects Market Update (pdf)<\/a>. The Kingdom\u2019s share of total GCC project awards declined to 51.3% in 3Q 2025, down from 57.4% in the same period last year.<\/p>\n

The slowdown was largely attributed to a deceleration in gigaproject awards<\/strong> amid several headwinds, including weaker-than-anticipated foreign investment, soft oil prices, and substantial cost inflation and engineering difficulties \u2014 especially in projects like Neom \u2014 according to data from Meed Projects. The construction sector was also under pressure, showing a clear decline in awards for new homes and hotels.<\/p>\n

By sector:<\/strong> Power led with USD 9.8 bn in new projects, despite seeing a 42.7% y-o-y decline. New construction contracts reached USD 5.2 bn, while the oil sector\u2019s awards dipped 2.5% to USD 3.9 bn. Key agreements signed during the quarter included a USD 853 mn contract with Almabani General Contractors for two road projects in Riyadh and a USD 167 mn agreement to develop a Pirelli tyre factory in King Abdullah Economic City.<\/p>\n

In the first nine months of 2025<\/strong>, contracts were almost cut in half y-o-y, falling to USD 61.5 bn compared to USD 116.6 bn in 9M 2024.<\/p>\n

Outlook remains positive despite the dip:<\/strong> The Kingdom still boasts the region\u2019s largest pipeline with USD 887 bn in planned projects \u2014 nearly half of the GCC\u2019s total. State oil firm Aramco also plans to roll out 99 new projects in the next three years to enhance its production capabilities. Meanwhile, the IMF has recently raised<\/a> Saudi Arabia\u2019s 2025 growth forecast to 3.5%. <\/p>\n

REGIONALLY-<\/strong> The total value of awarded projects fell 27% y-o-y in 3Q 2025 to USD 54.8 <\/strong>bn<\/strong>, marking the second-weakest quarter in the last two and a half years. This regional drop was driven by slowdowns in Saudi Arabia and the UAE, with geopolitical concerns and rising costs impacting investor sentiment. Regional construction activity saw the sharpest contraction, falling 62.4% y-o-y to USD 11.1 bn.<\/p>\n