How Kiwi companies are cracking Dubai's US$4 trillion construction market

Dubai Expo 2020
 

08 February 2018

Ahmad Zakkout / Business Development Manager / Dubai

Dubai’s skyline, with the iconic Burj Khalifa, is as recognisable as New York, London or Shanghai but other cities across the Middle East also boast impressive structures, thanks to the region’s considerable investment in infrastructure. 

The Middle East and North Africa’s USD4 trillion construction market is the world’s fastest growing, according to reports by BMI Research and PwC. As many of the countries in the region are focused on diversifying their economies away from a reliance on oil and gas, and cater to growing populations, new projects continue to be announced. For example, The Kingdom of Saudi Arabia has 89 hotel projects on the cards, delivering more than 40,000 rooms. The United Arab Emirates (UAE), increasingly a global tourism and entertainment hub, is building more than 35,000 hotel rooms. Elsewhere in the UAE, more than 1.43 billion dirhams (NZD542 million) is being invested in 12 major infrastructure projects, including 5 major roads. With Expo 2020 just around the corner this growth will not be slowing down.

Recently, Dubai held the Middle East region’s leading construction event – The Big Five – an exhibition that saw more than 2,500 exhibitors from 60 countries showcase their latest projects, products and services. 

2017 marked a turning point in the event’s history, with a focus on building more efficiently and developing smart, sustainable cities. Some of the innovations we saw relate to solar-energy, new products to reduce the carbon footprint of residential and commercial buildings, as well as 3D printed skyscrapers, and lightweight construction technology. Hyperloop technology, which is being developed with future sustainability in mind, was another talking point at the Big Five. The technology, developed by US company Hyperloop Transportation Technologies, will use renewable energy with the intention of producing more energy than it consumes.

Several New Zealand companies were at the Big Five and it’s heartening to see Kiwi manufacturing and construction companies investing in the opportunities this region presents. New Zealand is not a big player in the global infrastructure industry, but in the UAE in particular, New Zealand has a strong reputation as a provider of high-quality products and services. 

With the number of Kiwi companies setting up a presence in the UAE doubling over the past two years, the contribution of NZ companies to the UAE’s manufacturing and construction sectors has become increasingly significant. From school playgrounds to perimeter security technologies, structural timber solutions, steel framing and building materials to help protect buildings from the harsh Middle East climate, New Zealand companies are showing their strengths in niche areas of the construction sector.  

As with any international market, the UAE is not without its challenges. It remains a very price sensitive place to do business and finding the right distributor to be your champion on the ground can be difficult. The Emirates is also a very competitive market, due to the ease of setting up a business, which like New Zealand, can be done quite quickly. (The UAE is 21 on the World Bank’s Ease of Doing Business ranking.) Some sectors are still reliant on oil revenue but as the economy continues to diversify, this is expected to change. 

We created this video to help you navigate the United Arab Emirates infrastructure sector.

Contact nzte.govt.nz for more information.