A recent report by MEED magazine revealed that regional conflict has significantly weighed on contract-awarding activity across the Middle East and North Africa (MENA), with the value of signed deals falling sharply to $13.8 billion in March, compared to $26.8 billion in the previous month.
The report said the steep decline highlights the high sensitivity of regional markets to geopolitical tensions, which directly influence investment decisions and capital expenditure plans across key sectors.
Despite some ongoing large-scale projects, total contract awards in the region for the first quarter of 2026 stood at around $75.8 billion, down from $96 billion in the same period last year, signaling a broader slowdown in project activity across the region.
In Kuwait, activity remained limited, with only two contracts awarded in March totaling $318 million. The Ministry of Electricity, Water and Renewable Energy (Kuwait) awarded two major contracts to Power Grid, each valued at $159 million, to build 400-kilovolt transmission lines linking the Shagaya solar complex to Wafra and Subiya, as part of the national renewable energy expansion strategy.
The report noted that the Shagaya Renewable Energy Complex remains a key pillar in Kuwait’s transition toward clean energy, with the new transmission lines aimed at strengthening the national electricity grid and improving integration between generation and distribution networks.
Regionally, the United Arab Emirates led contract awards in March with $9.8 billion, driven largely by the gas sector. This included two major $4 billion deals under ADNOC Gas’s rich gas development program, reinforcing the country’s continued investment in energy expansion.
Saudi Arabia followed with $1.9 billion in contracts, supported by technology and digital infrastructure projects. A notable deal included an $800 million contract awarded to Human, an AI infrastructure company backed by the Public Investment Fund, to build a data center in Riyadh with a capacity of about 112 megawatts.
In Oman, $618 million worth of contracts were awarded, including a $414 million project by Muscat Municipality to expand the Muscat Expressway. The project, executed by Surooj Construction, includes road widening and connectivity improvements to enhance traffic flow and reduce congestion.
Bahrain recorded an $11 million infrastructure contract for the Amwaj Avenue development in Muharraq, aimed at supporting the broader Amwaj Islands urban expansion project through upgraded road networks and utilities.
Outside the Gulf, Egypt secured $1 billion in contracts during March, led by a $945 million deal signed by Modon Holding to develop the Ras El Hekma resort on the North Coast, underscoring continued investment in tourism-led mega projects.
The report concluded that the regional slowdown in contract activity reflects growing geopolitical uncertainty, with investment decisions increasingly sensitive to political developments. It warned that future project momentum will depend heavily on whether regional tensions escalate or ease in the coming months.
