USD 2.1 tn in capex from GCC is going to self-reliance + resilience -BlackRock

BlackRock sees the GCC deploying USD 2.1 tn in capex through 2030 — ranging between USD 1.6-2.5 tn — with a growing share staying home, according to the BlackRock Investment Institute. It’s also set to be a period of re-underwriting as countries reassess priorities in light of performance during war disruption. More than 80% of that capital is directed toward diversifying away from upstream oil and gas into energy infrastructure, industry, digital assets, and social investment — driven primarily by the goal of building resilience and self-reliance.

Existing projects are being reassessed and resequenced as countries weigh how infrastructure performed during the war’s disruption to regional shipping routes, from the Strait of Hormuz to the Red Sea.

REMEMBER- The GCC is already working on developing workarounds to hedge against future disruption that could once again cut it off from catching any upside from higher oil prices. Saudi Arabia is eyeing up expanding its East-West pipeline capacity to the Red Sea, and the UAE is also pushing ahead with plans to increase capacity in its own east-facing infrastructure.

Two segments are set to see up to two-thirds of total capex. Energy, resources, and industry is the largest single bucket at USD 735 bn — covering gas, downstream industries, and mining, including Saudi Arabia’s Jafurah gas program and the UAE’s Ruwais industrial base. Strategic redundancy follows at USD 660 bn, marking the pipeline segment most reshaped by the conflict — spanning export routes, ports, and power and water projects, illustrated by Saudi Arabia’s East-West corridor and Oman’s open-ocean ports.

The remaining three categories round out the shift. Digital infrastructure (USD 323 bn) goes beyond AI itself to the power, grids, and cooling needed to run it. Selective urban growth (USD 212 bn) is increasingly tied to fixed-deadline events like Expo 2030 Riyadh rather than open-ended expansion. Human and environmental resilience (USD 140 bn) covers healthcare, food, water, and waste systems.

More of that money will be staying in the region, BlackRock Investment Institute’s Ben Powell told Bloomberg (watch, runtime: 6:01). The GCC will remain an exporter of capital, he said, but a growing share will go toward building domestic economic resilience. The war has acted as “an accelerant” to diversification plans already underway, he added. Not every GCC market gets there the same way. The resilience strategy in the UAE is likely to see it turn to alternative logistical routing to support investment and trade, as well as to sectors like digital infrastructure, banking, and utilities to generate returns. Saudi, meanwhile, has the deepest pipeline in the GCC — and the highest execution and financing risk to go with it, so BlackRock flags sovereign-backed, well-funded projects as the ones best placed to deliver. Oman’s open-ocean access points present promise for the Sultanate, while Qatar, Kuwait, and Bahrain face a narrower window, with selectivity around corridor dependence, debt issuance, and fiscal repair mattering more there than scale.

MARKETS THIS MORNING-

Asian markets opened higher this morning, tracking a Wall Street rally on the back of a Treasury-yield pullback, with South Korea’s Kospi gaining 1.1%, Japan’s Nikkei adding 0.74%, and Hong Kong’s Hang Seng Index rising 1.9%. Meanwhile, mainland China’s CSI 300 rose 0.9%. Over on Wall Street, futures slid marginally ahead of Friday’s open.

THE CLOSING BELL-

The ADX rose 0.2% yesterday on turnover of AED 1.3 bn. The index is down 0.7% YTD.

In the green: Aram Group (+13.0%), Orascom Construction (+7.1%), and Space42 (+6.7%).

In the red: E7 Group Warrants (-2.7%), Fujairah Cement Industries (-1.6%), and Abu Dhabi Ship Building (-1.5%).

Over on the DFM, the index rose 0.5% on turnover of AED 535.4 mn. Meanwhile, Nasdaq Dubai was up 0.5%.