Aviation Projects in Middle East Valued at AUD 76 Billion

Aviation Projects in Middle East Valued at AUD 76 Billion

July 6, 2017

To position the region as a tourist paradise, Middle East nations are investing in state-of-the-art airport infrastructure and amenities valued at AUD 76.46 billion.

By Jagdish Kumar

According to BNC Network, a project research and intelligence provider in the Middle East and North Africa (Mena) region, of the 152 aviation projects under development in the Middle East region, 69 percent of the 152 projects are based in in GCC countries which include, Bahrain, Kuwait, Oman, Qatar, Saudi Arabia, and the United Arab Emirates.

The BNC’s Report claims that Saudi Arabia has the largest share with 46 percent, followed by UAE with 26 percent and Kuwait with 12 percent of projects.

In Saudi alone three major airport upgrades were awarded for construction in April 2017. This includes; the Hail Airport project valued at AUD 500 million awarded to TAV airports and Al Rajhi Holding Group to build a new terminal, Qassim International Airport located in Buraidah worth AUD 482 million also awarded to TAV Airports and Al Rajhi Holding Group for operations and airport upgrades and Taif International Airport worth AUD 460 million awarded to Asyad Holding Group, Consolidated Contractors Company and Munich Airport Company.

According to International Air Transport Association (IATA) data, Middle East carriers had the strongest regional annual traffic growth for the fifth year in a row in 2016. Revenue Passenger Kilometres (RPKs) expanded 11.8 percent, consolidating the region’s position as the third-largest market for international passengers.

Speaking on the report, BNC Network CEO Avin Gidwani claims that a strong aviation infrastructure will be a fundamental driver of development across the region.

“This is the main reason for Governments of Middle Eastern countries to increase investment in aviation infrastructure in the coming years… Connecting the region through a network of small airports facilitates urbanisation. Small airports support the need to continue to build larger airports as well, as airlines require hubs to manage their growing operations,” says Gidwani.

The BNC Report claims that air travel is being rapidly commoditised as people expect and demand fast, easy and economical mobility and for the region to stay economically competitive.

World class airport infrastructures also attract business and tourism to the region. With continuous economic growth in Arab countries and empowerment of the region’s population, it is expected that this will encourage more people to travel across the region and out of the region for business and leisure, pushing the demand for additional airport capacity – both passenger terminal and aircraft take-off and landing facilities. 

Other major deals in the pipeline include an STTS Aircraft Painting Facility located in Dubai World Aviation City and an Aircraft Hangar facility at Sharjah International Airport both of which are under development since contracts were awarded in April 2017.

Some of the largest airport deals listed in the Report include the Al Maktoum International which cost around AUD 10.51 billion, followed by Abu Dhabi International Airport’s expansion, valued at AUD 8.93 billion and the ongoing expansion of Seeb International Airport in Muscat as well as Kuwait International Airport.

According to global research firm Deloitte, out of the total global new aircraft order backlog, Middle East carriers, including Etihad Airways, Qatar Airways, Emirates, Gulf Air, Kuwait Airways, Saudi Arabian Airlines, Turkish Airlines, Royal Jordanian and MEA (Middle East Airlines) accounts for 14.4 percent of aircrafts yet to be delivered to airliners worth AUD 366 million.  

The 14.4 percent constitutes more than 1,000 aircrafts on order, which will cater to 400 million passengers by 2025.

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