MEED magazine reported a substantial surge in expenditure on water projects across the Middle East and North Africa (MENA) region in 2023, reaching its highest levels in three years.
The total value of contracts awarded in the water sector reached $20 billion, marking a remarkable 74% increase compared to the $11.5 billion awarded in 2022. This surpassed the highest annual contract values in the region recorded in 2021, which stood at $14.5 billion, reports Al-Anba daily.
The magazine emphasized that due to the region’s status as a hotbed for geopolitical tensions, water scarcity, and climate change, many countries in the MENA region recognize the critical importance of water security. Sustainable investments in water projects align with the region’s long-term economic diversification agendas.
Presently, there are projects valued at approximately $77.5 billion in the pre-implementation stage across the five water sub-sectors in the MENA region. This marks a 29% increase compared to the previous year’s projects under implementation.
This indicates significant opportunities for facility developers and engineering, procurement, and construction (EPC) project contractors seeking to secure more projects in this sector. Saudi Arabia continues to dominate future opportunities, with planned and non-awarded projects valued at around $30 billion.
Private utility developers are anticipated to play a more prominent role, particularly in Saudi Arabia, where numerous desalination, wastewater treatment, water transportation, and storage projects are planned.
In 2023, Saudi Arabia led with over 56% of the contracts awarded, totaling around $11 billion, signifying a 69% increase from 2022.
The UAE, the second-largest market in the region, experienced a substantial surge of over 250% in the value of contracts awarded, reaching approximately $4.9 billion, driven by independent water production projects and major water infrastructure.
While all other MENA countries recorded higher values of contracts awarded in 2023 compared to 2022, exceptions were noted for Qatar (decreased by 72%), Jordan (decreased by 58%), and Algeria (decreased by 57%).
Water transmission and distribution network projects retained a significant share, contributing 37% ($7.7 billion) in 2023, a 1% increase from the previous year. Water treatment plant projects saw a substantial increase of 180%, reaching $6.8 billion in 2023, and the value of water desalination contracts rose from $1.8 billion to nearly $4 billion.
Morocco awarded its first major independent water production contract, and Jordan’s Ministry of Water and Irrigation received a bid for the Aqaba-Amman water transfer and desalination project. The launch of the first batch of seawater reverse osmosis (SWRO) plants powered by renewable energy in Egypt is expected within the next 12 to 24 months.
Dubai and Qatar present profitable short-to-medium-term opportunities in sewerage tunnels and infrastructure projects.
Qatar’s Public Works Authority is set to issue a tender for four pumping station projects, while Dubai Municipality revived the strategic sewerage tunnels project, requiring an investment of up to $22 billion.
In conclusion, MEED magazine anticipates that water transmission and distribution projects will continue to be a priority in the MENA region, representing the largest water sub-sector. Utility companies aim to expand their networks to accommodate population, commercial, and industrial growth, connect new desalination and water treatment plants, and replace aging infrastructure to minimize water losses.
