Data from the Saudi American Business Council showed an increase in the value of contracts awarded in the Kingdom during the second quarter of 2021 to reach 25.8 billion riyals, an increase of 134% compared to the second quarter of 2020.
The contracts witnessed an increase of 34% compared to the first quarter of 2021, during which the value of these contracts amounted to 19.2 billion riyals.
The report indicated that the construction sector is witnessing a recovery in the awarding of contracts this year, despite the ongoing challenges caused by the pandemic, and the successive growth in contracts over the past three quarters reflects the Kingdom’s flexibility in its quest to advance its physical and social infrastructure.
The report stated that the construction sector is still on fragile foundations, as it faces a number of unfavorable factors, the most important of which is the rise in building materials costs, while the sector benefits from a number of favorable factors, the most important of which is the recovery in oil prices and the gradual increase in production, which constitute major driving forces in the sector’s return to pre-pandemic levels.
The report added that the demand for affordable housing, along with the government’s goal of reaching 70% home ownership by 2030, will keep construction in the residential real estate sector active in the medium to long term.
The report anticipates a further recovery in the implementation of awarded contracts by the end of 2021 and until 2022, as favorable factors support the resumption of strong demand for cement in the near term.