Bullish Construction Sector Fuels Growing Middle East Metals & Minerals Industry

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Researched by Industrial Info Resources (Sugar Land, Texas)--The booming construction industry in the Middle East is welcoming news to the manufacturers of construction-related material, such as cement, steel, glass, aluminum and aluminum-extruded products. The effect is felt down the economic ladder with the creation of over 10,000 jobs in the past two years in businesses supporting the construction industry in the region.

Although still largely dependent on oil revenues, the governments of Egypt, Saudi Arabia and the United Arab Emirates (UAE) are making strides in the development of the Metal & Minerals Industry. These oil-producing nations are working feverishly to diversify their economies. So far, the strategy is working. For example, the UAE government has formed the Mubadala Development Company (Abu Dhabi, UAE) as a wholly owned investment vehicle. The numbers of aluminum smelter and aluminum extrusion presses in the region also have increased. In the case of presses, the increase is more than 100%. The region has gone from having 25 presses to 85 in barely two years between 2005 and 2007. During the same period, the Mubadala Development Company, the Emirates Aluminum Company (Abu Dhabi), and other companies have budgeted $6.5 billion to construct eight additional grassroot aluminum smelters in the region. Six of those projects are still in the planning phase

Research by Industrial Info shows that more than $10 billion will be spent on cement, aluminum extrusion, structural steel and glass projects in the next three years. Roughly 50% of this capital investment will be in the UAE, with the rest of the Middle East sharing the remainder. The Arabian Cement Company (Rabigh, Saudi Arabia), Cemex Cement (Assuit, Egypt), the Al-Ahsa Development Company (Al-Ahsa, Saudi Arabia) and the Gulf Steel Industries Company Limited (Musaffah, UAE) are some of the companies involved in the spending spree. The spree is not limited to private companies.

The bullish construction industry is not lost on Middle East governments whose long-term economic strategies include provisions to create jobs, and produce construction and construction-related materials to meet and exceed local demand. With the reconstruction of war-torn nations of the Middle East and the creation of industrial cities, such as King Abdullah Economic City, the construction and construction-related material industries will continue to grow in the near-term.

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