Dubai to boost infrastructure spending by 43 per cent in 2018

19 December, 2017 | By COLIN FOREMAN

Dubai will increase its spending on infrastructure and construction projects by 43 per cent next year as it continues to prepare for Expo 2020 as well as invest in other strategic projects.

The Dubai government has a budget of AED11.886bn ($3.2bn) to spend on infrastructure projects based on the budget approved on 11 December by Vice-President and Prime Minister of the UAE and Dubai Ruler Sheikh Mohammed bin Rashid al-Maktoum. An estimated AED5bn has been allocated for Expo 2020 alone.

The 2017 budget for infrastructure spending was just over AED8bn.

For 2018, the government says infrastructure spending accounts for 21 per cent of the total budget expenditure of AED56.6bn. The spending will mean Dubai runs a budget deficit of AED6.2bn in 2018, which is 1.55 per cent of GDP. The overall 2018 budget spending is a 19.5 per cent increase on spending for 2017.

The increase in government spending on infrastructure projects does not necessarily translate into an increase in contract awards next year. This is because many of the infrastructure schemes that will receive spending in 2018 have already been awarded, and include major projects such as the Route 2020 extension to the Red Line of the Dubai Metro. According to regional projects tracker MEED Projects, there were $5bn (AED18.35bn) of public sector contract awards across all sectors.

The government says its spending for the Expo will total AED25bn. Spending on the metro expansion is estimated to be about AED10.6bn. This spending will not all be made in 2018.

Dubai is tendering contracts that will be awarded next year. Two major deals were recently tendered by the Roads & Transport Authority for the construction of the Infinity Bridge crossing Dubai Creek and the elevation of Al-Khail Road.

These projects will add to construction work on real estate projects that are being developed by private sector developers.

IMF sharply lowers regional growth projections

Downward revision comes as IMF warns of deteriorating economic headwinds for the region The IMF has downgraded sharply its forecast for regional economic growth due to lower-than-expected oil prices and a ...

Abu Dhabi real estate pivots to green

Environmental, social and governance (ESG) principles can become a way for Abu Dhabi real estate to differentiate its offerings at a global scale This article is the second in a series ...

GCC prioritises water projects

Energy efficiency and expanding renewable capacity drive independent water projects across the region Oman Power & Water Procurement Company has issued the letters of award for two seawater reverse osmosis (SWRO) ...

Levelling the export credit playing field

GCC governments are now setting up their own export credit agencies Over the past decade, using export finance has become an increasingly popular tool for delivering projects in the Middle East. Despite ...

Expo 2020 forges ahead with confidence

The postponement of the expo has not curbed enthusiasm to gather the world in a celebration of technology and interconnectivity When Expo 2020 officially confirmed its year-long delay on 4 May 2020, ...

Signs of trouble ahead for Dubai’s construction market

Key indicators point to a potential crash looming in Dubai’s projects sector, with significant consequences for the regional market Architects are not prone to fretting, so when one recently described his ...

Etihad railway to drive logistics growth

Some packages in the next stage of Etihad railway will link the UAE’s major ports The procurement process for the next stage of the UAE’s Etihad railway is now in full swing. Contractors ...

Etihad Rail completes stage 2 design

Etihad Rail unveils new strategy and brand identity following budget approval and completion of stage 2 network design Abu Dhabi-based Etihad Rail has completed the network design for stage 2 of the 1,200-kilometre ...

Disrupting Oil & Gas

New downloadable report from MEED, in partnership with Mashreq, brings together a series of case studies on the deployment of technology in oil and gas The global oil and gas industry is embracing ...

Removing waste from UAE construction

Insights on reducing waste and improving efficiency in construction in the UAE Waste is one of the biggest challenges facing UAE construction. Poor planning, lack of skills and unfair contracts combine ...