NFT at The Big 5 Heavy 2019

To start with, The Big 5 Heavy has always been a good opportunity for NFT to see customers face to face, catch up on their objectives for the coming year and hear their feedback on the past year. Customers can also benefit by sitting and talking directly with NFT’s CEO and Potain’s VP of Tower Cranes, as both will be present during the show.

Introducing the MDT 809 model

The launch of the MDT 809 is one of the most significant Potain tower crane launches of recent times: Over the past 10 years we’ve seen consistent growth in demand for topless cranes, with customers benefiting from their fast assembly and compact design, which makes it easier to get more cranes onto a job site to complete work quicker. Alongside this we’ve seen an increase in modular construction, with contractors needing to lift heavier loads. It’s clear to us that there is strong demand for bigger topless cranes. But we wanted to be sure that any new model we launch not only satisfied demand for greater capacity, but also preserved the easy transport, fast assembly and industry-leading performance our other topless cranes deliver. The MDT 809 provides all that and more. Here are some of the added value of the MDT 809:

Lower costs

With its highly optimized assembly and disassembly, owners can install the crane on site in the shortest possible time and move it off site rapidly once work is completed. Alongside that, the crane offers up to 40 t of lift capacity and can accommodate up to 80 m of jib. For transport, the crane is especially compact, with everything but the slewing mechanism capable of traveling in a standard container.

The whole crane transports in either 10 or 11 containers, depending on the winch option selected, which is four to five fewer containers than is typically required for a crane of this size. Smart design features to aid shipping include protective packaging for the jib sections; optimized space usage for containerization and a cab that rotates for transport. The crane also has a new 8 m cross base that offers the performance characteristics of a 10 m chassis, but which requires only one container for transport.

High-speed assembly

The Potain MDT 809 is not only fast to transport, but also fast to assemble once on site: typically, around twice as fast as other 40 t cranes and also requiring less space. With its full complement of jib, the crane can be assembled at a 50 m working height in less than three days. The 8 m cross base is not only easier to transport but also faster to set up than the 10 m alternative.

There are dedicated slinging points on the crane to aid on-site assembly and jib sections can be assembled either on the ground or in the air, depending on site conditions and available space. The rotating cab and easy-connect points for the counterjib further simplify erection. Options for assembling the jib range from the 30 m minimum up to the 80 m maximum in 5 m sections.

High performance

From the range of regular frequency-controlled hoists, options for the crane span from the 100LVF to the 270LVF. An optional 150HPL is also offered, from the High Performance Lifting range, for the ultimate in speed and strength. These winch options give the crane a maximum available capacity of 25 t, 32 t or 40 t. Tip loads of up to 9 t are available at the 80 m maximum. With the new reinforced K-mast system, freestanding heights of up to 80 m are possible.

Users can choose from a two-fall configuration on the trolley for faster duty-cycle lifting, or four-falls for heavy lifting. Inside the cab a simple push-button solution enables the operator to activate the cable-tensioning system automatically. This is particularly useful for long-running job sites, where tensioning is required more frequently. The Crane Control System (CCS) features too, with its customizable operator profiles; simpler commissioning; load curve P+ functionality and much more.

Introducing the hydraulic luffer MRH 175

More information on the advantage of hydraulic luffers can be found in our previous blog post. However, here’s a recap of some of the benefits:

Innovative crane, the hydraulic luffer is the first in the European range to combine luffing jib and topless capabilities; and it also uses hydraulic power for the luffing movement, for greater efficiency. As with the MDT 809, Manitowoc has placed a strong emphasis on return on investment for owners. The crane has an adaptable design making it suitable for all kinds of congested urban job sites, while transport and assembly times have also been optimized. Just four containers are required to transport the upper portion of the crane, with the counter jib and jib foot traveling as a single package. The unique VVH hydraulic luffing mechanism and cylinders are pre-connected at the factory, meaning no assembly is required on site.

A further advantage over traditional luffing jib cranes is that the hydraulic power of the VVH mechanism means there is no requirement to install luffing rope during installation. The hoisting winch, maintenance derrick and jib wind side plate are also pre-installed. Plus there is no need to adapt the wind-sail plate on site, no matter what length of jib the crane is erected with.

On-site the crane delivers outstanding operating performance, no matter how constrained the job site. The jib can be raised from the horizontal to near vertical (88°) in just two minutes, while the counterjib measures just 7 m and is simple to connect during assembly. The out-of-service weathervaning radius of just 10 m, whatever the jib length, adds to its impressive features for tight job sites, while the cab has the option to attach to either side of the mast to suit project conditions.

Sneak Peak into the MCT 565 coming in 2020

Why does NFT represent a brand like Potain?

Potain have been manufacturing tower cranes for 90 years so they are ahead of most manufacturers when it comes to innovation. New products with the customer requirements in mind are released on a regular basis. At every construction exhibition event no matter the continent, you can see a Potain stand with new products.  It is a global manufacturer with factories all over the word therefore they have policies in place for every segment of their business, whether it is manufacturing, procuring the right materials, or welding two joints together. The diversity of their fabrication facilities also mean they have different product offerings for specific market needs. The Potain name is known to historical contractors as a guarantee of safety and quality. When we did the research study, most of our customers scored high on variety, availability of spare parts endurance safety, reliability and quality.

They have a dealer network which we believe is second to none in this industry, and the manufacturer regularly organizes training / events to connect and educate those representing the product. As part of this dealer network, we can find used cranes and spare parts almost anywhere around the world. The main attributes of a Potain tower cranes include:

Innovation – Innovations include the Vision Cab, the Dialog control system and the LLC range of hoists.

Endurance – Potain cranes are especially adapted to perform strenuous work expeditiously. They offer frequency control systems for all modern and advanced operations, quick assembly and dismantling, full rotation system control and cart while, at the same time, they occupy minimal space for storage and transportation.

Quality: Potain tower cranes undergo serious testing under various conditions. It takes years for Potain to release new products because of the amount of time it takes to test all tower cranes. 2 testing centers: Lusigny and Charlieu in france.

High resell value – A Potain crane is an investment because of its guaranteed resale value. The brand name itself is well recognized by customers worldwide. In addition, the manufacturer guarantees the availability of Potain parts for all cranes, even those that are more than twenty years old! The well established Potain Second Hand crane market gives the highest residual value for the crane.

Adaptability – for building tall towers on  sites with several cranes, fast and easy installation in dense urban areas, for building narrow towers while saving on ties, for industrial construction – in fact just perfect for any type of work

French EngineeringFrench Engineering: Designed and tested in France. Assembled and manufcatured in Europe and Asia accordingto the same quality standadars in France. Regardless of where it is made, Potain is Fundamentally a French product.

The End.

Sources:

https://www.manitowoccranes.com/en/news-events/news/2019/190408-Manitowoc-unveils-biggest-Potain-topless-crane-at-bauma-2019 

Self-Erecting Tower Cranes Vs. Boom Truck

In our earlier posts, we touched base on the advantage of using self-erecting tower cranes over telehandlers and mobile cranes. Today, we discuss again the benefits of using self-erecting tower cranes for low rise building. NFT has supplied over hundreds of self erection cranes in the GCC over the past year and continues to promote its cost saving and increase capacity over other cranes. Today, NFT has 40 self erecting tower cranes in its fleet, ranging from 1 to 10 Tonnes.

Increased Efficiency

Efficiency when using self-erecting tower cranes is improve by:

  • Reducing number of framers required
  • Eliminating need for rough terrain forklifts and tow motors
  • Eliminating need for hydraulic crane for truss work
  • Reducing the number of laborers handling materials
  • Working on tighter job sites
  • Eliminating a pump truck for columns, footings, and walls
  • Saving time with quick and easy set-up

Self-erecting tower cranes set up so quickly compared to conventional tower cranes. These get on-site and in operation in less than two days.

Remote Control Operation

The remote control operation of these cranes is awesome, it allows to operate more efficiently and with less personnel.  The crane operator can rig several panels himself, pick and move them and unload in steps. NFT operators are  very efficient and experienced in driving self-erecting cranes.

The Future is Here: Self-Propelled Self-Erecting Tower Cranes

The Potain IGO MA21 mounted on a 4WD chassis that runs off of its own generator. Users can maneuver around the job site with 4-wheel drive and 4-wheel steer capabilities all while the tower remains set-up. No more setting up with a truck and trailer.

  • Driving and steering via tethered control unit with push buttons
  • Electro-mechanical four-wheel drive with 2 speeds and four-wheel steer
  • Can be driven fully erected (on flat, with no load)
  • Heavy duty axles with planetary hub reduction and dual 9.00 x 20 off-road tires
  • Four extendable hydraulic outriggers with a base of 13.1 x 13.1 ft.
  • Power supply: Onboard 23kVA soundproof genset, or customer supplied 480 V “city power”
  • Transport dimensions: (l x w x h) 39.6 by 9.1 by 10.1 ft., total weight 49,384 lb.

Award Winning Hup Range

The Hup 40-30 wins LLEAP Gold Award in 2017. This model maximizes profits with more job opportunities than ever before.

  • Maximum reach for class-leading performance : One mast provides two telescoping heights and four jib positions plus a potential partial jib. This versatility enables 20 possible crane configurations.
  • Multiple integrated configurations for various jobsite needs: Telescoping, integrated masts give you the option of working at heights of 21 m (70 ft) or 27 m (88.6 ft). In addition, automatic erection system requires no extra mast section to greatly reduce setup time.
  • Unmatched compact design for challenging jobsites and easy transport: the entire crane can be fitting in one high-cube container for shipment and can be transported on axles for land deliveries.

Innovative movement technology enables unfolding in
narrow and compact areas: Jib unfolds over the top to preserve
space under the crane when working next to buildings

  • The New Smart Set-up software simplifies crane erection using the exclusive Potain remote control and the electrical panel is easily accessible for convenient serviceability. The software has an  intuitive user interface for simplified, step-by-step crane erection  

In Conclusion, the self-erecting tower cranes is now replacing other forms of cranes for buildings below eight floors. All the above mentioned benefits ultimately results in more cost saving for higher efficiency on site.

End.

Source: 

https://www.constructionequipmentguide.com/self-erecting-tower-cranes-revolutionizing-the-building-industry/44953

https://www.manitowoccranes.com

New Potain Tower Crane Works As Topless, Stores As Luffer

Earlier in May, we spoke about hydraulic tower cranes and the MCH 125. Today, we will touch upon the MRH 125 which was launched at Bauma in April earlier this year.

The MRH 125 can lift up to 8.8 U.S. tons, be equipped with up to 164′ of jib, and lift 2.2 U.S. tons at the tip of the longest jib. Its maximum freestanding height is 190′, and maximum line speed is 387 fpm with 50LVF20 hoist winch. The Topless design with several elements making up the slewing crane part reduce the standard size and weight to make transport, handling, and fitting easier.

As with all of its products Manitowoc has placed a strong emphasis on return on investment for Potain MRH 125 owners. The crane’s adaptable design suits it for congested urban job sites while also optimizing transport and assembly times. “The MRH 125 has an optimized transport cost for a luffing jib crane in its capacity class,” said Thiebault Le Besnerais, Manitowoc‘s global product director for tower cranes. “It can also be mounted on our standard 1.6 m (5’6″) or 2 m (6’6″) K-masts for better optimization for fleet owners, and it offers lower power consumption than traditional luffing jib cranes.”

The MRH 125 also uses the latest luffing technology of the VVH hydraulic luffing mechanism which allows complete hoisting of the jib in two minutes. VVH hydraulic luffing eliminates the need to install luffing rope during crane setup. The hoisting winch, maintenance derrick, and jib wind side plate also come pre-installed to save setup time. Plus, there is no need to adapt the wind-sail plate on site, regardless of jib length. Also, the cab can be attached to either side of the mast to suit project conditions.

The jib can be raised from horizontal to near vertical (88°) in just two minutes, and the compact counter jib measures just 23’ and connects easily during assembly.

The main features of the MRH 125 are as follows:

It’s the perfect crane for confined areas

  • Almost vertical luffing jib for minimum space requirement when working
  • Weathervaning radius optimized for each jib length, just 10 m for the 50 m jib, ideal for congested jobsites
  • Option to fit the cab on the left-or right-hand side of the jib according to jobsite needs and especially to allow installation of the crane as close to the building as possible.

It’s the fastest fitting of a luffing jib crane

  • One single counter-jib/jib foot package bringing together all of the connected hydraulic functions. No inter-jobsite dismantling/fitting, compact and transportable in one package
  • No installation of luffing rope thanks to an innovative hydraulic system: save fitting time compared to traditional luffing system and increased safety

Transport is Optimized

  • Only 4 containers or 4 trucks for transportation of the whole slewing crane part with a 50 m jib

Optimized return on investment

  • Luffing jib crane adapted to very tight urban jobsites
  • Economical transport, easy and adapted to the fitting sequences
  • Fitting/dismantling time reduced through a design combining the Topless concept with hydraulic luffing technology
  • Improved fitting safety

In conclusion,  the MRH 125 has all the advantages of traditional luffing jib cranes with the capacities of the topless cranes. This combination of the best of both worlds ensures outstanding operating performance and guarantees a positive return on investment. To view the datasheet or request a quote, visit:

https://www.nftcrane.com/en/content/hydraulic-cranes

First quarter improvement for Manitowoc

Manitowoc Crane, which also includes Grove mobile cranes and Potain tower cranes has posted first quarter revenues 8.3 percent higher at $418 million.
The increase was attributable to higher crane shipments in the Americas and European regions, coupled with pricing improvements, partly offset by unfavourable changes in exchange rates. The pre-tax loss increased from 6.1 million in the same quarter last year to $23.4 million this year, entirely due to a $25 million charge for early extinguishment of its debt, when it refinanced on more favourable terms in March. Without this the company would have been back in the black with a profit of $1.6 million. At the operating profit level it made $16.2 million compared to just $1.7 million last year. Full year revenues are now forecast to be three to seven percent higher at $1.9 to $1.97 billion.

Chief executive Barry Pennypacker said: “Manitowoc once again delivered a strong start to the year, delivering our eighth straight quarter of year over year adjusted EBITDA margin increase. The operating principles of The Manitowoc Way continue to produce improving financial results as we execute our strategy for profitable growth by delivering innovation and velocity in everything we do.”

“In March, we successfully refinanced our capital structure to further strengthen our balance sheet. This action increases liquidity, reduces interest expense and allows us more flexibility to deploy our capital in order to increase shareholder value.”

“Market conditions remain very competitive. We continue to focus on providing innovative products and services for customers as evidenced by positive customer reception to our six new cranes introduced at the bauma trade show in April. As a result of our first-quarter performance and our proven ability to execute on our strategy, we are raising our full-year guidance.”

Sources:

https://www.cranesy.com/new-potain-tower-crane-works-topless-stores-luffer/ 

https://www.manitowoccranes.com

https://www.vertikal.net/en/news/story/32996/first-quarter-improvement-for-manitowoc

Manitowoc showcases new Potain MRH 125 at Vertikal Days

The Start of 2019 in Construction

Dubai construction firms bullish on year ahead

Construction firms in Dubai remained strongly optimistic regarding the 12-month outlook as business conditions in Dubai’s non-oil private sector economy continued to strengthen in February, at a similar rate to January, according to latest data provided by Emirates NBD Dubai Economy Tracker.

Construction, a key sector in Dubai, continued to report growth of new contracts in February. The rate of expansion accelerated from January’s 27-month low, but was still weaker than in any other month over the same period, and much slower than the rise in total construction activity, the report said. Although sentiment slipped from January’s record high, it was still among the highest on record. Growth of construction activity accelerated for the second month running in February, to the fastest since the record pace achieved last November. The seasonally-adjusted Business Activity Index was the fifth highest on record.

“Workforce growth at construction companies was maintained in February. The seasonally adjusted Employment Index eased since January to 50.7, however, indicating only a marginal rate of job creation,” said the report.

The data continued to point to subdued cost pressures in Dubai’s construction sector. The seasonally-adjusted Input Costs Index rose from January’s seven-month low of 51.0 to 51.8, but still signaled a weaker rate of inflation than the long-run series average. According to analysts, with the deadline for completion of several projects before Expo 2020 Dubai looming, construction activity is set to pick up. According to Lodging Econometrics’ year-end Global Construction Project Trend Report, Dubai had a pipeline of 168 hotel construction projects with 49,950 rooms as of 2018, ranking it second in the list of global cities with the largest hospitality pipelines, only behind New York City’s 171 hotels with 29,460 rooms.

“Prices charged by construction companies rose for the second month running in February, but at a rate which remained only marginal. Previously, charges had fallen throughout the last four months of 2018,” said the report. Total business activity in Dubai rose at the fastest rate in nine months, while new business increased at a pace that remained above the 2018 average despite easing since January. Employment, however, fell at the fastest rate since the survey began in 2010. The seasonally-adjusted Emirates NBD Dubai Economy Tracker Index was unchanged from January’s seven-month high of 55.8 in February, signalling a strong improvement in business conditions that was faster than the trend for 2018. While companies in the wholesale and retail sector reported the firmest volume growth in February – although with greater price discounting than in January – travel and tourism firms in Dubai remained strongly optimistic regarding activity levels over the next 12 months in February. The headline index for the wholesale and retail sector rose to an eight-month high of 58.1, above the comparable figure for the travel and tourism sector (56.8, a nine-month high). The third key sector monitored – construction – also registered a stronger performance in February (54.0).

Khatija Haque, head of Mena research at Emirates NBD, said the growth in the volume of output and new work has been underpinned by continued price discounting, particularly in the wholesale and retail trade sector.

“Firms’ margins continue to be squeezed as selling prices have declined on average for the last 10 months, while input costs have increased over the same period. As a result, rising new orders have not translated into increased hiring and job growth in the private sector. Indeed, employment declined at the fastest rate on record in February.”

The report said the data signalled a rise in business activity in the non-oil private sector. Moreover, the rate of expansion accelerated to the fastest since May 2018. Wholesale and retail posted the strongest growth among the three key sectors.

“However, the rate of contraction in workforce was the strongest registered since the series began in January 2010, despite faster activity growth,” it said.

Saudi Arabia to start first phase of Neom project

Construction on Saudi’s $500bn (SAR1.9tn) Neom gigaproject will start in Q1 2019, officials announced on 16 January, 2019.

The Neom Founding Board, chaired by Saudi Arabia’s Crown Prince HRH Prince Mohammed bin Salman bin Abdulaziz, approved the strategic concept of the master plan for Neom Bay, the first urban area to be developed within Neom, as reported by Saudi Press Agency (SPA).

The board gave “gave instructions to complete preparations and start construction work in the first quarter of 2019”, the state-news agency added.Work on Phase 1 of Neom Bay will be completed in 2020. It is expected that a number of key facilities will be completed by the end of this year, including the current airport at Sharma, which will be upgraded to become a commercial airport operating regular flights between Riyadh and Neom.

Speaking on the news, Nadhmi Al-Nasr, chief executive officer of Neom, said 2019 will be “milestone” in the megaproject’s journey.

He added: “The strategy of developing Neom Bay will rely on four key pillars that will be ingrained in the entire project development, with sustainability at the heart of aspect of the project.

“The first is to provide a living experience and an ideal quality of life for families; the second is to create a high-end lifestyle and a luxurious tourist destination; the third and fourth pillars are to support both innovation and creative centers in order to achieve Neom’s economic goals.”

Earlier this week saw another first at Neom when a Saudi Arabian Airlines (Saudia) flight, carrying 130 of its staff, landed at Neom airport in Sharma, located in the Tabuk region.

Backed by Public Investment Fund, which is led by Saudi Arabia’s Crown Prince HRH Mohammed Bin Salman, Neom maps the kingdom’s long-term aspirations through 16 economic sectors.

Stable prices of construction materials offer respite to UAE builders

Three months into the year, the UAE’s construction sector is having a much smoother ride, and it’s not just related to the pickup in activity related to the Expo 2020 works. Instead, it is the relative price stability on building materials that is offering the much-needed respite.

One only needs to look at how aluminium has been faring. In May last year, the metal was commanding $2,700 a tonne on the LME (London Metal Exchange) — now it can be had for $1,841 after being at $2,000 as recently as December 20. As for local contractors, the softening price — and the belief is it will remain under pressure — will sit well on their project costs. And there is quite a bit of that happening.

“There is definitely new activity being pushed by the Expo requirements and we are still seeing that in our recent orders,” said Christian Witsch, CEO at Gulf Extrusions. “But building material suppliers and contractors need to start thinking about the next big event once all the Expo-related supplies and works are done.

“That’s what we need to start looking out and preparing for — the next big event in the UAE.”

The sharp upswing in aluminium prices in May last year was brought on by factors outside the scope of the industry. In short, politics was what dictated the volatility. in particular, the US sanctions on Russia’s Rusal — the world’s largest aluminium producer outside of China. (Early this year, the sanctions were rolled back by President Trump.) “Last year changed my perception that LME price was only driven by effects happening only within the industry,” said Witsch. “But in 2018, the main driver was political forces.”   Gulf Extrusions currently has an annual installed capacity of 50,000 tonnes, of which it currently utilises about 40,000 tonnes. The bulk of its production is used as “architectural solutions” by the local construction sector. Drive down Shaikh Zayed Road and chances are that one or the other tower will have been supplied by the manufacturer, including the Burj Khalifa. Witsch says the sector needs to start preparing for life after the Expo. “When the Expo impact gets less visible in our own offtake, we already have measures in place to grow in other markets,” he added. (Currently, exports make up 10 per cent of its output. It has also been raising its supply of value-added extrusions to the global automotive industry. Gulf Extrusions is currently rated as a Tier-2 supplier and is now working to upgrade it to Tier-1.) 

And what of steel? The UAE in January doubled import duties on steel debars (deformed bars) and pipe rods to 10 per cent, a move that met the long-standing demands of local steel mills to take action against steel dumping from China and Turkey.

“The Ministry of Economy understood the need to support local steel manufacturing that has invested billions in the industry,” said Bharat Bhatia, CEO of Conares, which operates a mill in Jebel Ali. “Current steel consumption in the UAE is between 3.2 million to 3.5 million tonnes, while local production of deformed steel is about 4 million tonnes.

“Imports currently are arriving only from the GCC, but due to quicker delivery, most projects are demanding “Made in UAE” products. Even traders prefer to stock local as they can get it 24×7 and in the required lot size.”

For now, steel prices are at around Dh2,000 plus. As for cement, “They have been stable for the last seven months or so, and that’s because local production had increased capacity quite significantly,” said Mohammad Farooq, Managing Director at Dubai Walls Construction. “These days, a 50-kg bag could be bought for Dh12.2 from Dh12.5-Dh12.7.

“But the biggest plus for local contractors and suppliers has been the relaxing on visa requirements to bring in additional manpower. Paying deposits to source manpower was where a lot of the cash flow of contractors were getting stuck. Now that the UAE authorities has relaxed this, it puts contractors in a much better situation. That’s a huge relief, no doubt.”

After a tough 2018, the local construction sector will take any break that comes its way. Local manufacturers seek tax support on other building materials now that the UAE has raised import duties on steel, local building supply manufacturers are hoping the local and GCC authorities would extend it to other product categories as well.

The GCC Secretariat recently instituted a “safeguard duty” on painted, varnished or plastic coated for a three-year period, with the duty set at $169 a tonne and then reducing thereafter. Market sources say they are awaiting for these measures to be applied at the local level. “In regards to colour coated, since the GCC has imposed safeguard measures we are expecting the same to be applied in UAE,” said Bharat Bhatia of Conares. Also, the import duty on pipes could be looked into as well, according to Bhatia. “Domestic manufacturers would also like to have support from the authorities in protecting pipe and tube manufacturers. “Scaffolding companies are currently exempted from import duties — this practice should stop.

“Scaffolding companies don’t add any value on pipes. Only true value-added products should be exempted. The UAE has 2 million tonnes of installed capacity on pipes and tubes, and it would help if duties are raised to 10 per cent.”

Saudi Arabia’s Prince Turki unveils multibillion-dollar Asir projects

According to Saudi Press Agency (SPA), Prince Turki said the projects cover sectors such as health, transport, and municipal services.

Major transport projects announced include the construction of the Asir-Jazan road at a cost of $1.6bn (SAR6bn); and the $1bn (SAR4bn) expansion of the coastal road between Jeddah and Jazan, which will link Asir to Makkah and Jazan, providing shorter journey times.

Among the recently progressed Saudi Arabia construction projects is the expansion of Abha Airport’s terminals to increase its capacity from 1.1 million passengers a year to 2.5 million. Plans also include increasing the number of boarding gates for domestic flights to four and for international flights to two.

According to an Arabic-language report by SPA, another significant completed project in Asir is the 1,000-bed King Faisal Medical City, which features a specialised hospital, a cardiac centre, a tumour centre, and a centre for neurological sciences for children. The facility will reportedly serve Asir and the Baha, Najran, and Jazan regions.

The projects follow directives by Saudi Arabia’s Crown Prince, Vice President of the Council of Ministers, and Minister of Defence, HRH Mohammed bin Salman bin Abdulaziz, to raise the quality of medical services and the efficiency of road and air traffic in the kingdom.

The news comes amid of flurry of infrastructure announcements from the kingdom’s senior leadership. Last month saw King Salman bin Abdulaziz Al Saud, Custodian of the Two Holy Mosques approve 1,281 cross-sector development projects in Riyadh.

UAE launches $8.7bn housing project plan

HH Sheikh Mohammed bin Rashid al Maktoum, the UAE Vice President, Prime Minister and Ruler of Dubai, has announced the launch of a massive plan that will see more than 34,000 residential units built across the country within the next six years.

Developed for the local Emirati population, the project has had funds worth $8.7 billion allocated to it, and it is expected to be completed by 2025, a report by WAM said. It added that Sheikh Mohammed had also given directives to raise the value of the salary ceiling of beneficiaries obtaining support from the Sheikh Zayed Housing Programme from AED10,000 to AED15,000.

He also issued a directive to raise the value of housing loans for citizens in government residential neighbourhoods from AED800,000 to AED1.2 million as a maximum loan amount, depending on the value of the premises.

The decisions came in the wake of an inspection tour conducted by Sheikh Mohammed bin Rashid, during which he visited a number of housing and road infrastructure projects in Ras Al Khaimah, the report said.

“We have pledged, from the beginning, to ensure that every UAE citizen is provided with a home, and that no area is left undeveloped,” he said during the tour.

“The quality of housing across the country is of a unified standard,” he noted, adding that housing services for UAE citizens are also unified.

“We want higher levels of competitiveness between government sectors for the benefit of Emiratis. The Sheikh Zayed Housing Programme holds a special value providing necessary services to Zayed’s children,” he added.

HyperloopTT to start construction on Dubai-Abu Dhabi border in Q3 2019

The proposed Hyperloop site is within Aldar’s Seih Al Sderieh landbank, located on the border of Abu Dhabi and Dubai, close to the Expo 2020 site and Al Maktoum International Airport.Hyperloop Transportation Technologies (HyperloopTT, HTT) appointed a design lead for its planned project on the Dubai-Abu Dhabi border, in a major step towards making the futuristic commercial travel system a reality in the UAE. A team led by Lebanese design and engineering giant Dar Al-Handasah will begin construction of the first commercial Hyperloop system in Abu Dhabi in Q3 2019.

In addition to joining the project as design lead, the Dar Al-Handasah is also on board as investor with HyperloopTT.HyperloopTT signed an MoU with listed property firm Aldar Properties in April this year to develop a new HyperloopTT centre that will include a full scale commercial Hyperloop system, an XO Square Innovation Centre and Hyperloop Experience Centre.The proposed site is within Aldar’s Seih Al Sderieh landbank, located on the border of Abu Dhabi and Dubai, close to the Expo 2020 site and Al Maktoum International Airport. Construction of the Hyperloop commercial track, as well as HyperloopTT’s XO Square Innovation Centre and Hyperloop Experience Centre, is targeted to begin in Q3 2019.

“We are bringing the future of rapid transportation technology to all those living in the UAE,” said HyperloopTT chairman Bibop Gresta.

Manitowoc to unveil new cranes and lifting solutions at bauma 2019

Manitowoc, one of the leading global manufacturers of cranes and lifting solutions, has announced the debut of six new models from its Grove and Potain lines at bauma 2019 in Munich, Germany. T he company will also present a technology pavilion, highlighting a wide range of customer-focused innovations. Apart from the six new cranes, Manitowoc will display more than 10 new cranes during the show from 8-14 April 2019.

At the company’s stands FS 1201, FS 1202 and FS 1302/1, several new Potain cranes will be on display including those from its topless tower crane and self-erecting Hup ranges.

For Grove, Manitowoc will introduce new cranes from its all-terrain and rough-terrain lines. The company will also present new technologies for the industry, with one highlight involving a recent advancement in telematics.

Commenting on the world’s leading construction equipment trade fair, Barry Pennypacker, president and CEO of Manitowoc, said, “bauma 2019 will be a great opportunity for us to connect with a large number of Manitowoc customers, which will enable us to gather the information necessary to continue our strategy of adding tremendous value to our customers.”

Sources

https://www.khaleejtimes.com/business/economy/dubai-construction-firms-bullish-on-year-ahead

https://gulfnews.com/business/property/stable-prices-of-construction-materials-offer-respite-to-uae-builders-1.62552780

https://www.constructionweekonline.com/projects-tenders/169895-saudi-arabias-prince-turki-unveils-multibillion-dollar-asir-projects

http://www.technicalreviewmiddleeast.com/events/eventnews/manitowoc-to-unveil-new-cranes-and-lifting-solutions-at-bauma-2019

https://www.constructionweekonline.com/168736-saudi-arabia-future-super-city-neom-construction-start-in-2019

https://www.arabianbusiness.com/uae/406731-hyperlooptt-to-start-construction-on-dubai-abu-dhabi-border-in-q3-2019

UAE launches $8.7bn housing project plan

VAT & The Construction Industry in GCC

At the beginning 2018 United Arab Emirates and Saudi Arabia introduced Value Added Tax (VAT) of 5% on most purchases across various sectors. There have been speculations on how VAT would impact the economy as a whole, the growth of different industries, future investments and the employment.

According to the UAE Government website, Value Added Tax or VAT is a tax on the consumption or use of goods and services levied at each point of sale. VAT is a form of indirect tax and is used in more than 180 countries around the world. The end-consumer ultimately bears the cost. Businesses collect and account for the tax on behalf of the government.

It continues by stating, businesses will be responsible for carefully documenting their business income, costs and associated VAT charges.

Registered businesses and traders will charge VAT to all of their customers at the prevailing rate and incur VAT on goods/services that they buy from suppliers. The difference between these sums is reclaimed or paid to the government.

In this article, we will review the impact of VAT on different industries in the region, we will then look into its impact on the construction sector in the region.

Why do countries introduce VAT?

According to World Bank, empirical studies have shown the interlinks between the VAT performance of a country and its level of development.   The revenue gains from VAT are likely to be higher in an economy with higher level of per capita income, lower share of agriculture, and higher level of literacy.  VAT proves to be an efficient tool for revenue collection; its performance, therefore, has direct impact on fiscal mobilization, macroeconomic stability, and development.

Compared with alternatives in indirect taxation, the VAT has more revenue potential:  it is generally more broad-based and entails a trail of invoices that helps improve tax compliance and enforcement.

According to The National, The introduction of value added tax had a positive impact on economic growth and development in the GCC in its year of implementation, a report said, as the UAE and Saudi Arabia come up on its first anniversary and Bahrain prepares to roll out the levy in 2019.

Once implemented, a GCC-wide VAT could generate revenues of between 1.5 per cent and 3 per cent of the six-country economic bloc’s total non-oil gross domestic product from next year, the report from the Federation of GCC Chambers said, citing earlier figures from the International Monetary Fund.

Impact of VAT in the United Arab Emirates

Most countries have introduced VAT, and it has proven to have a positive impact on the economy. According to a study conducted by Entrepreneur Middle East, here are some of the benefits of VAT in the UAE:

  1. Boost to government coffers
    The new tax is expected to bring a significant new revenue stream to the UAE government. According to His Excellency Younis Al Khouri, Undersecretary at the Ministry of Finance, the measure is expected to raise around AED 10bn to AED 12bn in the first year of implementation alone. This revenue will go into creating a more stable economy, which can’t help but have a positive knock-on effect on local businesses.
  2. Improved infrastructure
    Not only will the revenue help to stabilize the economy, but it will improve the country’s infrastructure, making it easier and less expensive to do business in the UAE. Investment in infrastructure often has a significant effect on economic development because of multiplier effects, which means that for every AED 1 invested the impact on GDP is even higher. What’s more, value-creating tax strategies can give you a competitive advantage compared to other countries in the region, although in the UAE’s case this will be neutralized by the fact that all six GCC countries will eventually implement the same measure.
  3. Non-financial benefits
    As demonstrated by a number of successful global implementations, tax regulation can bring many non-financial benefits to an economy. The most important of these is improved liability management. The introduction of taxes, particularly VAT, can play an important role in enhancing government accountability and democracy. Official taxation records, properly managed, result in faster and more informed decision-making, and reduce the incidence of civil fraud, corruption and waste.

    Impact of VAT on the construction sector – regionally

    According to an Article on Khaleej Times about the impact of VAT on the construction sector in the UAE,” The UAE’s construction industry has not been impacted by the recent introduction of 5 per cent value-added tax (VAT) and it will witness over 10 per cent expansion in 2018, the second-fastest growth rate in the world, according to industry executives and research reports.

    The industry executives believe that Expo 2020 is not the end for the construction sector. Rather they are pinning hopes on multi-year plans such as Vision 2021 which would drive the industry in the post-Expo 2020 era.

    “I see good potential for the construction sector. I would say VAT has not impacted us that much; however, there is a pressure on cash flow but people are getting used to it,” said Ravi Murthy, chief financial officer, Arabtec Construction”

    As for the real estate sectors, industry leaders have a similar feedback. “Matthew Bate, CEO, Engel & Volkers, told Khaleej Times that there was no impact of VAT and first quarter of 2018 was its biggest operating quarter during the last three years.

    “VAT didn’t really have any impact because five per cent is negligible, considering some of the rates that exist in a lot of economies. With the way VAT works with input and out taxes, it has got very little effect on developers. I think VAT probably if affects anything is it is from cash flow position. But if you got a nice sustainable business, then VAT has little impact,” he said.

    Bates noted that “the government is behind a lot of construction activity and obviously Expo 2020 is a major factor. But it is a lot beyond that. I don’t’ think any developer or industry is focusing feasibility studies and returns on investments are just based on 2020. It is the whole 2021 plan, and beyond that as well.”

    Future of construction sector and VAT

    If there is one message for businesses to take from the implementation of VAT in 2018 is that a conservative approach to VAT collection and recovery is advisable.

    While the market is getting used to the concept of VAT, a conservative and risk-averse approach to filing VAT returns seems likely to be the most cost-effective in the long run. For areas of ambiguity it is vital that businesses have a clear paper trail to support any decisions which may be examined during any audit.

    For the construction industry the long project timelines, complex supply chains and phased payment programmes are all compounding the challenges of adjusting to the new tax regime. The most crucial issues for the businesses represented revolved around getting clarity on exactly when they should be collecting and reclaiming VAT.

    Processes to narrow the gap between raising invoices and actual payment are much needed in order to prevent businesses having to carry the VAT burden for an unreasonable period. As the four remaining GCC states go live with their VAT systems in the coming years, demand for clear and consistent processes across the region will grow.

    Manitowoc posts positive results

    Crane manufacturer Manitowoc reported full-year orders for 2018 of $1,910.7 million – a three percent increase on 2017’s figure. Manitowoc also reported its full-year revenue for 2018 increased by 17 per cent year-over-year (YOY), from $1,581.3 million in 2017 to $1,846.8 million in 2018.Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) was $116.2 million, and 6.3 percent of net sales.

    The company’s 2018 results were boosted by its fourth quarter figures, where net sales were $515.3 million versus $481.5 million in the comparable period in 2017. Manitowoc primarily attributed the YOY increase to improved demand in the Americas, driven by higher shipments of cranes for the commercial construction and energy end markets – although this was partially offset by lower demand in the Benelux countries and the Middle-East, coupled with unfavorable changes in foreign currency exchange rates.

    “The Manitowoc team again delivered excellent results in the fourth quarter, marking the seventh consecutive quarter of year-over-year adjusted EBITDA percentage improvement,” commented Barry Pennypacker, Manitowoc president and chief executive officer.

    Fourth-quarter orders, however, of $485.7 million for 2018 decreased 22 percent from the comparable period in 2017. Backlog totalled $670.6 million at 31 December 2018, an increase of 11 percent, from the prior year ending backlog of $606.6 million.

    Looking ahead to 2019, Manitowoc said it expected revenue to increase from approximately $1.85 billion to $1.95 billion and for adjusted EBITDA to increase from approximately $125 million to $145 million. “Our results and outlook demonstrate how our strategic priorities are delivering ever-improving results,” Pennypacker added. “We will continue to provide our customers with the type of cranes they need to increase their return on invested capital. This will be evident with our new product introductions at the Bauma trade show in April 2019.”

    Sources:

    http://guyanachronicle.com/2018/11/27/vat-credits-for-electricity-and-water

    https://government.ae/en/information-and-services/finance-and-investment/taxation/valueaddedtaxvat

    http://www1.worldbank.org/publicsector/LearningProgram/PracticalIssues/papers/Value%20added%20taxation/Value%20Added%20Taxation.doc

    https://www.entrepreneur.com/article/307462

    https://www.saifaudit.com/blog/2015/10/28/vat-in-dubai-how-vat-can-affect-uae-competitiveness/

    https://www.khaleejtimes.com/business/real-estate/No-VAT-impact-on-construction-sector-in-UAE

    https://www.bromheadco.co.uk/insights/construction-drawn-into-vat-reverse-charge-process

    https://mena.thomsonreuters.com/en/articles/the-impact-of-vat-on-the-gcc-construction-sector.html

    https://www.americancranesandtransport.com/american-cranes-and-transport/manitowoc-posts-positive-results/137041.article

Why is everyone talking about PPP?

There have been many talks in recent years in the GCC and primarily in the UAE about the private sector and the growing support for it. The key focus of the Ghadan 2021 vision is to fund, encourage and push the private sector to grow. Some of the benefits of a growing private sector includes its contribution to the GDP, creating employment, attracting foreign direct investments to the country; this is just to name a few.

Now, another topic is in the spotlight: the partnership between public and private sector in the UAE. But what is the nature and the various elements of this type of partnership and what are the benefits for the economy.

The official history of public private partnership (PPP) is not that long ago. According to Law Teacher website, “In 1992 the John Major led government, in the United Kingdom introduced the Private Finance Initiative (PFI), which was the first systematic programme aimed at encouraging Public-Partnerships. The United Kingdom has one the most advanced public-private partnership programmes. Public-private partnership is responsible for about 24% of its public investments. The process has also been adopted by some Australian state governments; a model is the state of Victoria”.

We will review this topic in detail and showcase how such partnership have benefited the economy in the past.

According to World Bank, “There is no one widely accepted definition of public-private partnerships (PPP). The PPP Knowledge Lab defines a PPP as “a long-term contract between a private party and a government entity, for providing a public asset or service, in which the private party bears significant risk and management responsibility, and remuneration is linked to performance”. PPPs typically do not include service contracts or turnkey construction contracts, which are categorized as public procurement projects, or the privatization of utilities where there is a limited ongoing role for the public sector. For a broader discussion, see PPP Knowledge Lab . An increasing number of countries are enshrining a definition of PPPs in their laws, each tailoring the definition to their institutional and legal particularities”.

“In some jurisdictions, and in particular civil law counties that follow the tradition of the Code Napoleon, a distinction is made between public contracts such as concessions, where the private party is providing a service directly to the public and taking end user risk, and PPPs, where the private party is delivering a service to a public party in the form of a bulk supply, such as a Built-Operate-Transfer (BOT) project for a water treatment plant, or the management of existing facilities (e.g. hospital facilities) against a fee.

In other countries, specific sectors are excluded from the definition, particularly those sectors which are subject to effective regulation or where there is extensive private sector initiative, such as in ICT Telecoms. In some countries arrangements involving more limited risk transfer such as management contracts are excluded from the definition for institutional reasons as the authorities prefer that they fall under traditional procurement processes for goods and services”.

What are the expected outcomes of public private partnerships?

Ministry of finance of the republic of Lithuania has summarized the advantages and some of the disadvantages of PPP, which are as following:

PPP advantages:

  • Ensure the necessary investments into public sector and more effective  public resources management;
  • Ensure higher quality and timely provision of public services;
  • Mostly investment projects are implemented in due terms and do not impose unforeseen public sectors extra expenditures;
  • A private entity is granted the opportunity to obtain a long-term remuneration;
  • Private sector expertise and experience are utilized in PPP projects implementation;
  • Appropriate PPP project risks allocation enables to reduce the risk management expenditures;
  • In many cases assets designed under PPP agreements could be classified off the public sector balance sheet.

PPP disadvantages:

  • Infrastructure or services delivered could be more expensive;
  • PPP project public sector payments obligations postponed for the later periods can negatively reflect future public sector fiscal indicators;
  • PPP service procurement procedure is longer and more costly in comparison with traditional public procurement;
  • PPP project agreements are long-term, complicated and comparatively inflexible because of impossibility to envisage and evaluate all particular events that could influence the future activity.

Public private partnerships in various countries

United Kingdom

In 1992, the Conservative government of John Major in the UK introduced the PFI,[30] the first systematic programme aimed at encouraging public–private partnerships. The 1992 programme focused on reducing the public sector borrowing requirement, although, as already noted, the effect on public accounts was largely illusory. The Labour government of Tony Blair, elected in 1997, expanded the PFI initiative but sought to shift the emphasis to the achievement of “value for money”, mainly through an appropriate allocation of risk. However, it has since been found that many programs ran dramatically over budget and have not presented as value for money for the taxpayer, with some projects costing more to cancel than to complete.

United States

In 2017, the State of Texas sought its first ever private partner to join in a project to renovate the G. J. Sutton Building in Downtown San Antonio near the Alamodome, according to Mike Novak, the chairman of the Texas Facilities Commission. Local governments in Texas have already entered into such partnerships including the redevelopment of the HemisFair Arena and the construction by Weston Urban of a new Frost Bank Tower in San Antonio. Named for G. J. Sutton, the first African-American elected official in San Antonio, the six-acre complex was vacated by the state in 2014 because of bat infestation and a deteriorating foundation. In 2015, Governor Greg Abbott, counter to the wishes of Mayor Ivy Taylor, used his line-item veto to remove $132 million which would have funded the rehabilitation of The Sutton. The state expects to see the property used at some point in the future for office space and parking slots. Billy Nungesser, the lieutenant governor of Louisiana, proposed in 2017 that public–private partnerships be established for many of his state’s financially-strapped state parks, which fall under his jurisdiction, particularly citing two popular facilities in Sabine Parish: North Toledo Bend State Park and Hodges Gardens State Park, at which operating costs vastly outstrip revenues from the $1 park admission fees. Because of recurring state financial issues, the fate of state parks in Louisiana remain in doubt after July 1, 2017

Public private partnership in the UAE

According to the UAE government website, “in 2017, the UAE Cabinet issued resolution (1/1) on the procedures manual for partnership between federal entities and private sector. The manual intends to diversify the mechanisms for developing the strategic infrastructure projects and improve the quality of services. It also provides a general framework for project lifecycle of partnerships with private sectors.

Dubai regulatory framework of Public Private Partnerships

Government of Dubai enacted Law No. 22 of 2015 which sets up the regulatory framework of Public Private Partnerships in the emirate of Dubai. The law aims at encouraging the private sector to participate in the development of projects and increase investments in different fields. According to the law, a partnership project may be proposed by a government entity or by the private sector. It also specifies certain terms for partnerships between the public and private sectors. They are:

  • feasibility of the project economically, financially, technologically and socially
  • allocation of sufficient funds in the budget of the government entity to cover the expenses of the project, if any.

The law stipulates conditions for approving the projects. These conditions involve, among other things, funding and methods of partnerships. The term of the partnership contract may not exceed thirty years from the date of execution. For more details, read the guide Public Private Partnerships in Dubai issued by Department of Finance – Government of Dubai”.

Public Private partnership in the construction sector (Case study)

In the UAE, to align with the PPP initiative, according to ConstructionWeekOnline, two public-private partnership (PPP) contracts worth $13.9m (51.3m) have been awarded by Abu Dhabi Municipality (ADM) for the construction of a service station and a market.

UAE firm Tristar Engineering and Construction Company won a $9.8m (AED30m) contract to build the 12.3ha community market in Mohammed bin Zayed City.

Florida Property Development Company will build a $4.1m (AED15.3m) service station in Al Shawamekh city that will provide car repairs, carpentry, and a range of household maintenance services.

Saif Badr Al Qubaisi, ADM’s general manager, said the duo of deals will “step up the development drive and add to the new projects needed for delivering modern services to the community”. He noted that the agreements with Tristar and Florida Property Development Company reinforced the municipality’s mission to bolster “cooperation with the private sector”.

Earlier this year, ADM signed $24m (AED87m) worth of contracts to build social infrastructure projects, including three playgrounds, a sports centre, and four service stations. These contracts were signed as part of growing collaboration with the private sector.

Will other countries in the GCC follow suit?

According to an article published on ME Construction News website, while there has been collaboration between the public and private sectors for some time, the relationship has been restricted to service contracts and to the water, energy and transport sectors. Most projects in the GCC region developed using a recognised PPP model have traditionally done so under each market’s own version of tender and procurement laws.

One of the key reasons PPP has yet to make a mark in the region is due to the lack of legislation, however, experts have pointed out that this is beginning to change. “I’m pleased to see that countries and states that are interested in PPP are trying to regulate it and introduce a framework for it. That’s the very first step,” said Andrew Mackenzie, partner at Baker McKenzie Habib Al Mulla, a law firm specialising in construction disputes and arbitration.

“We haven’t yet seen an explosion of these projects. We’re beginning to see a few of them pop up more regularly, particularly in the power or water sector – where private companies want to partner with public bodies to provide desalination plants or power projects of a particular nature.”

Highlighting the $500 billion NEOM city development as a particular example, Mackenzie told MECN.com that it would be a perfect test for the private-public partnership model. “I think Saudi Arabia will begin to take the lead on more of these megaprojects, but the UAE, Oman, Kuwait, Bahrain and Qatar have a number of significant projects in the pipeline. As we move towards $70, possibly even $80, a barrel in oil prices, these projects become far more commercially viable as more liquidity returns to the market.”

Conclusion

Even though PPP has its clear advantages, but it has its critics as well. Many believe that not all sectors/verticals should fall within the PPP framework, some essential sectors such as water or energy of education should always be controlled by the government as they should always be kept as a non-for-profit entities while other believe that privatization helps sectors grow and become competitive and eventually help us achieve more.

Oman to lay foundation stone for PPP housing project

Oman will lay the foundation stone for an affordable housing development built through a public-private partnership (PPP) in the coastal city of Barka on 22 October. Representatives from the country’s Supreme Council of Planning (SCP) will attend the ground-breaking ceremony for the integrated residential project in northern Oman, on behalf of HE Sheikh Saif bin Mohammed Al Shabibi, Minister of Housing.

Oman’s state-run news agency said the mixed-use residential community was a “first-of-its-kind” project for the sultanate due to its PPP model, which would see “one of the leading real estate companies” develop the community in accordance with international construction standards. The name of the company was not revealed, nor was the project’s value, but it is believed to the be the first time that SCP and Oman’s Ministry of Housing have collaborated on a project of this scale. The Barka-based residential community will have shops, a mosque, healthcare centres, public parks, and an open grassy field for sport. The project is designed to attract Omanis seeking affordable and modern properties. Equipped with integrated infrastructure, tree-lined boulevards, ample parking, and a host of amenities, officials in Oman’s government hope the project will stimulate economic growth and reduce state spending through private sector collaboration, according to Oman News Agency. 

Meanwhile, real estate deals in Oman have been on the slide recently, as Ministry of Housing statistics recorded a year-on-year decline in the value of property deals during the first six months of 2018. Despite a rise in cash generated by stamp duty collection fees, money made by property sales dropped marginally by 0.4% in H1 2018 when compared to the same period a year ago.  A surge in housing plot allocation has partially offset the nominal value decline. In total, 22,128 residential plots were handed out between January and July 2018, marking a 29% rise on the 17,125 building plots granted by the government during the first seven months of 2017.

End.

 

Sources

https://bridgemastersinc.com/u-s-infrastructure-benefits-public-private-partnerships/

http://farsportscars.com/state-federal-goverment-venn-diagram.html

https://www.lawteacher.net/free-law-essays/commercial-law/origin-of-public-private-partnerships-commercial-law-essay.php

https://finmin.lrv.lt/en/competence-areas/public-and-private-partnership-ppp/ppp-advantages-and-disadvantages

Allen, Grahame. “The Private Finance Initiative (PFI) Commons Briefing papers RP01-117” (PDF). UK Parliament: House of Commons Library. 

Richard Webner, “State seeking builder for Sutton rehab”, San Antonio Express-News

“Are State Parks closing?”. The Alexandria Town Talk. April 16, 2017. Retrieved April 17, 2017.

https://www.government.ae/en/information-and-services/business/public-private-people-partnership/public-private-partnership

https://www.reuters.com/article/us-dubai-future-analysis/dubai-inc-may-face-shakeup-after-debt-standstill-idUSTRE5AO4J820091126

https://www.constructionweekonline.com/article-50010-abu-dhabi-signs-ppp-agreements-worth-14m

http://meconstructionnews.com/27910/gcc-governments-need-proper-regulations-and-frameworks-for-ppp-to-succeed

https://www.constructionweekonline.com/article-50527-oman-to-lay-foundation-stone-for-ppp-housing-project

2019 Projections & Resolutions

GCC construction needs better New Year resolutions

A commonly held belief is that most New Year’s resolutions have been forgotten by the third week of January. While there seems to be little scientific basis for this time frame, the idea certainly makes for some interesting discussions in the break room. I am sure that construction leaders in the Middle East are eager to devise – and publicise – their business resolutions for 2019, but which items must they prioritise on their wish lists, which will undoubtedly impact the sector’s New Year plans for growth?

Goal-setting is a healthy exercise, both for business leaders and professionals, but to understand what we should pursue in 2019, it is important to review the shortcomings of 2018. Construction Week has published countless insights and news articles about the latter, tackling everything from payment delays to skills shortagesconstruction disputes, and market liquidity. We have heard from the Middle East’s top construction contracting bosses in 2018, and also had the opportunity to relay the concerns of the engineering staff working at these firms, which included issues such as low salaries and insufficient career development opportunities. With all this in mind, how can success be defined in 2019?  At Construction Week, we have found that, regardless of position in the organisational hierarchy, it makes business sense to pursue productivity. For chief executive officers and managing directors, this means cutting costs and improving the bottom line. Professionals in mid- or junior-level roles might instead describe a successful year as one in which they received a promotion, or added an educational qualification to their CV. These different ambitions actually rely on quite similar tools and strategies. Construction experts around the world are adopting technology to make business operations more efficient and streamlined. In the region, building bosses are using cost management software to better track their finances, and the best of engineering supervisors are strapping on smart watches to remotely manage multiple worksites. Similarly, ‘lean’ principles are finding favour in the Middle East, with company leaders and employees alike using these management guidelines to improve the quality and efficiency of their output. Of course, technology is not the only answer to the problems that our industry might face in 2019. A smart watch or telematics-enabled truck will not protect a contractor against, say, the impact of low oil prices on market demand. However, regional megaprojects are nearing their completion deadlines, and the GCC’s economic diversificationmandates continue to drive developments. These opportunities may well protect engineering firms against the challenges they expect to face in 2019, but to truly succeed in the New Year, they will need more than just a set of resolutions that might not even make it to spring.

Project progress of 2018 will boost GCC construction in 2019

The team at Construction Week is often asked for advice on contemporary market conditions. Common enquiries are about whether a certain project has progressed, or if engineers will be paid more in the months to come. Of course, these answers depend on the insights that industry leaders share with us. For instance, over the last few months, Construction Week has observed regional construction leaders and advisors offering varying projections of the industry’s growth in 2019.

Some, such as Khalaf Al Habtoor, founding chairman of Dubai’s Al Habtoor Group, are optimistic about 2019, and have expressed confidence in GCC economies as diversification efforts gather steam and global oil prices note growth, despite a recent decline in value. Other market advisory sources, such as Colliers, believe that construction may become a more expensive activity in key regional markets, such as Saudi Arabia, next year.  I may face some disagreement on this point, but I think of 2018 as a broadly positive period for the Gulf’s construction industry. We’ve seen some incredible projects – such as Warner Bros Abu DhabiDubai FrameHaramain Rail, and Muscat International Airport – being completed and delivered this year. Moreover, several contracts have also been awarded for large developments across the region in 2018, especially in the UAE’s and Saudi Arabia’s residential and commercial real estate sectors. Some regional leaders may have felt a shortage of market opportunities in 2018, and this sentiment may be particularly strong within the group that remembers the construction boom in the run-up to the oil price decline of 2014. However, steady progress was made on major under-construction developments this year, such as Expo 2020 Dubaiand Riyadh Metro. Indeed, these projects, alongside similar masterplanned communities in the Gulf – Madinat Al Irfan(Oman) or Silk City (Kuwait), for instance – will ensure that regional builders are busy in 2019 and beyond. Equally remarkable is the intangible progress made by the regional community in 2018. Dispute resolution and payment delays, the construction industry’s most impactful – and until recently, seldom discussed – pressure points, took centre-stage in 2018. Construction Week’s Dispute Resolution Question Time conferences held in Dubai and Abu Dhabi this year shed light on the importance of drafting proper contracts. As we reported in 2018, regional contractors are adopting a selective approach to bidding for new work, which bodes well for their finances in 2019. The best chief executive officers will tell you that intuition is as important as hard facts whilst doing business. It’s hard to predict whether 2019 will be an easier year for regional construction, but as the qualitative and quantitative growth of 2018 has shown, the prognosis is good.

Global construction output to grow 3.6% per year until 2022 – report

Middle East to be among fastest-growing regions as worldwide output touches $12.9tr.

The global construction industry is expected to rise to $12.9tr in real value terms by the year 2022, expanding by an average of 3.6% per year from 2018 until then, with the Middle East region leading the growth, according to a report by the worldwide data and analytics company GlobalData. In its latest report, ‘Global Construction Outlook to 2022: Q3 2018 Update’, the company reveals that construction output will go up worldwide from its 2017 level of $10.8tr, with certain regions registering faster growth than others.Danny Richards, construction lead analyist at GlobalData, said: “We forecast that global construction output growth will accelerate to +3.6% in 2018, up from 3.1% in 2017, reflecting the recovery in the US as well as general improvements across emerging markets. In South and South-East Asia, for example, construction in India has regained growth momentum, while the pick-up in oil prices has supported the recovery in the Middle East and Africa.’’

The Middle East and Africa region as a whole will be the fastest with an annual average growth of 6.4% from 2018 to 2022. The report said that the GCC countries, which have suffered from the weakness in oil prices greatly reducing government revenues in recent years, are expected to see a return to growth. As oil prices pick up, large-scale investment in infrastructure projects – mostly related to transport – will be a key driving force behind the construction growth in the region, the report added. Globally, the pace of construction growth is set to improve slightly to 3.7% between 2019 and 2020, before easing back in the latter part of the forecast period, reflecting trends in some of the largest markets, said the report. The Asia-Pacific region will continue to account for the largest share of the global construction industry, but its growth pace will slow down owing to a projected slowdown in China’s construction industry to an average of +4.2% between 2018 and 2022, offset by an acceleration in construction growth in India. The report added that construction activity is gathering momentum across Western Europe with the region’s output set to expand by 2.4% a year on average from 2018 to 2022. However, expansion in the UK is subject to major risks in the face of uncertainty over Brexit. “While there are intensifying downside risks for global construction related to global economic growth, notably stemming from the erupting trade war between the US and China, the global economy will continue to expand in the range of 2.5% to 3% a year from 2018 to 2022 which will support continued construction growth in key markets,’ Richards added.

Sources:

http://www.constructionweekonline.com/article-50948-gcc-construction-needs-better-new-year-resolutions/

http://www.constructionweekonline.com/article-50900-project-progress-of-2018-will-boost-gcc-construction-in-2019/

Global construction output to grow 3.6% per year until 2022 – report

Why has the investment in infrastructure increased over the past 5 years in the GCC?

In the past few years GCC countries have seen significant investment going toward the infrastructure and almost every month, the news headlines consist of major projects being announced. In the report we are looking at the factors behind the growth in the infrastructure in the region and introduce some considerable projects.

According to a report by the International Monetary Fund (IMF), “The GCC economic model relies on oil as the main source of export and fiscal revenues (Figure 1). The government is the dominant force in the economy, receiving oil export revenues and in turn distributing them to citizens. A portion of these revenues is spent directly by the government and provided to citizens through transfers and public sector jobs; another portion is invested in infrastructure and real estate, education, and health; while the rest is saved, including in sovereign wealth funds (SWFs). Most GCC countries have long oil and/or gas production horizons and, consequently, have significant wealth underground as well as saved in SWFs or at the central bank”.

According to Global Finance, An infrastructure boom is taking place in the GCC. Most of the GCC countries have some kind of 30-year plan or vision to develop projects, as these oil-rich countries look to invest surplus funds in transport, utilities (power, water) and petrochemical infrastructure to keep pace with their rapidly growing economies and populations.

Before getting into the details, according to Invstopia, infrastructure is the term for the basic physical systems of a business or nation — transportation, communication, sewage, water and electric systems are all examples of infrastructure. These systems tend to be high-cost investments and are vital to a country’s economic development and prosperity.

Visions of the leaders

In the UAE, the government has a dedicated ministry specially for infrastructural development. According to Khaleej times, Energy, utilities and transportation sectors in the UAE will see massive growth in the next two decades as the government will pump Dh1.3 trillion in the development of these sectors, analysts said. Recently, Abu Dhabi National Oil Company (Adnoc) has announced plan to invest Dh165 billion in downstream sector. Also, the UAE is investing billions of dirhams in transportation sector such as Etihad Rail, Dubai Metro and Hyperloop.

According to Middle East Rail, $250 billion is expected to be invested in the Middle East on various railway projects over the next decade. This year alone, it’s estimated that spending on 162 regional projects to be over $86.7 billion.

In addition, billions of dirhams are currently being pumped into the development and expansion of Al Maktoum International Airport and Abu Dhabi Airport. In addtional, the metro line expansion for the Expo 2020 site where NFT has a dozen tower cranes installed, is another main infrastructure project. According to Strategy& report, other GCC governments are also investing significant amount to develop infrastructure. Saudi Arabia is likely to spend Dh4 trillion ($1.1 trillion) from 2019-2038, while the UAE is scheduled to invest $350 billion over a similar time frame. These large development schemes can allow local companies not just to substitute imports, but also to grow non-oil exports by enhancing their capabilities.

According to Strategy& report, GCC governments need to think logically about how they balance the need to localize manufacturing while pursuing sound economic policies. There are many capabilities that the region does not possess because of its small size and hence needs to import to build infrastructure. According to Emirates News Agency (WAM), earlier this year, the development journey of the UAE aims to place the country at the highest levels of global competitiveness, to provide the best in class quality of life to people and achieve their happiness, said His Highness Sheikh Mohammed bin Rashid Al Maktoum, Vice-President and Prime Minister of the UAE and Ruler of Dubai. His comments came during his visit to The Sustainable City – the first net zero energy city in Dubai. He was accompanied by Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum, Crown Prince of Dubai.

“Our vision is clear in terms of establishing sustainability’s pillars as a key component of our development journey, which is part of the national agenda. We are committed to sustainability, which is a top priority that we strive to implement taking into consideration environment conservation, and balance between economic and social development,” Sheikh Mohammed said.

Saudi Arabia and the increase in Foreign Direct Investment (FDI)

According to a report by CNBC, Saudi’s $500 billion mega-city NEOM is attracting ‘overwhelming’ interest from investors

With ambitious plans to transform its economy as part of the crown prince’s Vision 2030, Saudi Arabia is hoping to boost foreign direct investment (FDI).

With ambitious plans to transform its economy as part of the crown prince’s Vision 2030, Saudi Arabia is hoping to boost foreign direct investment (FDI) into the country as it embarks on a post-oil era and ambitious mega projects like the futuristic city of NEOM.

Ibrahim Al-Omar, governor of the Saudi Arabian General Investment Authority (SAGIA), said foreign direct investment (FDI) was growing in Saudi Arabia. Official figures from the World Bank show FDI net inflows were $7.453 billion in 2016 while net outflows were $8.936 in the same year. Since then, however, Saudi Arabia’s Crown Prince Mohammed bin Salman has appeared to take the reigns on transforming the economy and society by introducing a raft of liberalizing reforms.

“We have seen a growth for foreign investment — about 50 percent comparing the first quarter this year to the same period last year. Also, the (FDI) inflows we have seen about 40 percent,” Al-Omar – governor of the Saudi Arabian General Investment Authority (SAGIA)- told CNBC as she hosted a session on the Saudi Arabian FDI landscape at the Gateway Gulf investment forum in Bahrain.

The project is estimated to take between 30 to 50 years to complete, however, with the first phase due by 2025.

“And the $500 billion, we’re not going to spend it all tomorrow and, quite frankly, a lot of it will come from private investments,” Kleinfeld (NEOM’s Chief Executive) said. “But what I’m seeing today is that the interest in partnering is overwhelming.”

Kleinfeld said that key concepts for NEOM, such as mobility around the city, were still being explored and there “there are gazillions of players that are willing to help and willing to invest in that,” he said. With the current wealth of the region, which have significant amounts in their Sovereign Wealth Funds (SWFs) and an increase in Foreign Direct Investment (FDI), the plans to improve the infrastructure in the region is well underway.

Fluctuations in the price of crude oil

Oil prices have been fluctuating in the past few years and based on most sources, the outlook doesn’t seem that the prices will increase significantly next year. As outlined in the graph below by Macrotrends website, the oil prices have decreased since 2014.This decrease in oil prices is another reason as to why, GCC countries have looked into diversifying their economies and lower their dependencies on oil and consequently investing in infrastructure.

More populations – the need for better infrastructure

The graph above by Worldometers website, clearly show the significant increase in the population of the UAE and just in less than 15 year the population has almost doubled. This amazing increase in population not only shows more job opportunities in the country but also a major need for a better infrastructure.

Economic diversification in the region

According to a report by the International Monetary Fund (IMF), the Gulf Cooperation Council (GCC) growth model has delivered strong economic and social outcomes over several decades. GCC economies rely on oil as the main source of export and fiscal revenues. Over the years, GCC governments have increased public sector employment and spending on infrastructure, health, and education. This has helped raise standards of living and support private sector activity, particularly in the non-tradables sector.

The current growth model has weaknesses, however, and increasing economic diversification is paramount. Greater diversification would reduce exposure to volatility and uncertainty in the global oil market, help create private sector jobs, increase productivity and sustainable growth, and establish the non-oil economy that will be needed in the future when oil revenues start to dwindle. A number of policies have been adopted to diversify the GCC economies and reduce their reliance on oil. A stable, low-inflation economic environment has been achieved, the business climate has been strengthened, education has been expanded, trade and foreign direct investment (FDI) has been liberalized, and the financial sector deepened. National development plans are being implemented with a view toward boosting the human capital of nationals, and developing new industries and services that can employ high-skilled labor. Nevertheless, to date these diversification strategies have yielded mix results. The share of non-hydrocarbons output in GDP has increased steadily but is highly correlated with oil prices, and progress with export diversification, a key ingredient to sustainable growth, has been more limited.

One of the key reasons as to the increase in the investment in infrastructure is to make sure the economic diversification plans can actually be achieved but of course as mentioned above, it has had its challenge as well.

In Summary

 With $1.2 trillion of roads, buildings and infrastructure projects planned across the GCC at the start of 2018, according to Research and Markets report, the region offers abundant opportunities for construction contractors, engineers, project managers and manufacturers. In the next two decades, according to Strategy& non-OECD states are projected to spend more than $57 trillion on infrastructure projects, compared to $34 trillion by OECD countries, it said. Historical under-investment in infrastructure, rapidly-growing populations, the emergence of the new Silk Road trading route between the MENA region and Asia and the need to diversify beyond oil and gas are all contributing to the need for heightened investment in infrastructure.

New Kuwait 2035 needs smart city-led contracts

The six-strong panel, moderated by Charles Lilley, partner at law firm Bryan Cave Leighton Paisner (BCLP), took to the stage to discuss all things related to the Kuwait National Development Plan. Commonly referred to as New Kuwait 2035, the programme seeks to increase the country’s revenue from $43.6bn ( KWD13.2bn) in 2017 to $164bn (KWD49.8bn) by 2035. With these figures in mind, the country’s leadership has placed great emphasis on the development of transport infrastructure, commercial buildings, industrial facilities, and renewable energy infrastructure.

The issue of technology as part of Kuwait’s New Vision 2035 was also discussed, particularly in the context of numerous planned high-profile smart city initiatives rolling out across the region, notably the planned $86bn (KWD26.1bn) Silk City mega-project. “Smart cities are no longer just something that is nice to have, but a requirement by default,” said Nabil Kobrosly, vice president of business development for Parsons’s built environment division in the Middle East and Africa. “In each and every project that we do, especially in construction design, provisions are made for smart city consultants or technology operators to be able to bring in their equipment.

End.

Sources

https://internationalbanker.com/finance/making-infrastructure-investment-more-attractive-to-private-capital/

https://www.investopedia.com/terms/i/infrastructure.asp

https://www.imf.org/external/pubs/ft/sdn/2014/sdn1412.pdf

https://www.khaleejtimes.com/business/economy/uae-to-invest-/dh13-trillion-in-/these-sectors

https://www.cnbc.com/2018/05/10/saudis-500-billion-mega-city-neom-is-attracting-overwhelming-interest-from-investors.html

http://wam.ae/en/details/1395302665808

https://www.gfmag.com/magazine/september-2013/gcc-infrastructure-investment

https://www.macrotrends.net/2516/wti-crude-oil-prices-10-year-daily-chart

http://www.worldometers.info/world-population/united-arab-emirates-population/

http://whatson.ae/dubai/2016/09/dubai-future-accelerators-programme/

http://www.mei.edu/publications/rise-gulf-investment-india-searching-complementarity-and-synergy

https://www.uae-embassy.org/news-media/uae-economic-diversification-efforts-continue-thrive

http://www.constructionweekonline.com/article-50521-leaders-kuwait-2018-new-kuwait-2035-needs-smart-city-led-contracts/

Abu Dhabi’s “Ghadan 2021” Vision

The Middle East region is going through some economic changes and there has been massive projects revealed and announced by head of states. On September 16 Abu Dhabi’s Crown Prince Sheikh Mohammed bin Zayed announced the budget and initial round of projects for the Ghadan (Tomorrow) 2021 strategy, a three-year plan designed to further reduce the emirate’s dependence on oil revenues.

Ghadan 21 – which means ‘tomorrow’ in English – is the banner name for a series of reforms aimed at stimulating investment, creating jobs, encouraging innovation and improving the overall quality of life for citizens. The plan will feature 50 initiatives focused on four areas – business and investment, society, knowledge and innovation, and lifestyle. According to Gulf News, A Dh50 billion three-year development accelerator programme for Abu Dhabi has been approved. The announcement was made on Twitter by His Highness Shaikh Mohammad Bin Zayed Al Nahyan, Abu Dhabi Crown Prince and Deputy Supreme Commander of the UAE Armed Forces. Shaikh Mohammad said that the programme, dubbed Ghadan 21 (Arabic for Tomorrow), was approved during a meeting with members of the Abu Dhabi Executive Committee.

“We have approved a three-year, Dh50 billion budget for the Abu Dhabi Government Accelerators Program Ghadan 21. Dh20 billion will be allocated to the 2019 development package,” Shaikh Mohammad tweeted.

Approved on September 16 by His Highness Sheikh Mohamed bin Zayed Al Nahyan, the Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, the work on Ghadan 2021 (translated to Tomorrow 2021 in English) will commence from the beginning of 2019.

Push for economic reform

According to The National, the plan has 50 initiatives to stimulate investment and job creation, including investment in the knowledge sector, the employment and education of Emiratis, and overall quality of life. It will slash red tape for businesses and build confidence in the emirate’s economy. Sheikh Saif bin Zayed, Deputy Prime Minister and Minister of Interior, and Sheikh Mansour bin Zayed, Deputy Prime Minister and Minister of Presidential Affairs, were among those present at the meeting. During the session, the Cabinet ratified an agreement on cultural exchange between the UAE and France, and an air transport agreement between the UAE and Belize, the UAE and the Marshall Islands and air services between the UAE and the Caribbean country of Grenada. Additionally, it approved agreements to promote and protect UAE investments with Kazakhstan and Costa Rica, and agreed that the Emirates join the 1997 Protocol of the International Convention for the Prevention of Air Pollution caused by ships.

Private sector – the key focus of business development in the Ghadan 2021 strategy

According to Oxford Business Group, Abu Dhabi has moved ahead with plans to bolster the emirate’s non-oil economy following the launch of a Dh50bn ($13.6bn) programme aimed at fast-tracking economic growth and social development. Key to the Ghadan initiative is the improvement of the emirate’s business environment, with a particular focus on facilitating greater private sector participation.

“To this end, the Abu Dhabi Executive Council – the body tasked with overseeing the programme – announced the establishment of a new business licence registration process, which should allow for the approval of 91% of commercial activities within five minutes. To support this, the Tajer licence, which allows operators to establish businesses without having a permanent office, has also been expanded to cover all nationalities and more than 1000 different commercial activities.

Meanwhile, in terms of financing, officials announced that a credit guarantee programme will be established before the end of the year. Under this initiative, banks are expected to offer small and medium-sized businesses Dh10bn ($2.7bn) in funding over the next three years. This was coupled with the announcement that a new public-private partnership (PPP) law would soon be issued, and the initial tranche of these PPPs will be tendered in the first quarter next year, with up to Dh3bn ($816.9m) worth of projects in housing, infrastructure, energy and health care on offer. On this note, the Ghadan strategy is expected to generate opportunities for a range of service providers, with the construction and materials supply sectors in particular set to benefit from the uptick in projects forecast over the coming three years”.

Additionally, the government is also moving to support domestic services and materials suppliers, looking to adopt by early next year a new content policy giving preference to local suppliers in state tenders.

Innovation, Research & Development

According to the same report, another key feature of the programme is the facilitation of Abu Dhabi’s knowledge economy through a series of developments promoting innovation and research and development (R&D).

“Key to meeting these goals is the establishment of a new tech incubator, expected to open by the end of the year.

On top of developing local expertise and start-ups through cooperation with the private sector, the committee said the incubator will serve to increase Abu Dhabi’s attractiveness as a destination for tech-sector talent, and support industry-based R&D efforts. In terms of education, officials announced plans to add some 30,000 places to the emirate’s school capacity over the period, to be made up of 15,000 new students in private schools by 2021 and 15,000 in existing state schools by next year”.

Reaction from the market leaders

Walid El-Hindi, chief executive officer of Abu Dhabi-based developer Imkan, also voiced his support for the development strategy.

“We are delighted to learn of the Tomorrow 2021 reforms, which represent a further step towards strong economic diversification in the UAE,” he said.

“Our leadership’s long history of strategic initiatives represents their vision to create a capital city with diverse and robust sectors that go far beyond oil. We believe this is a strong step towards stimulating  investment and further enhance the quality of life for Abu Dhabi’s residents and visitors.”

According to Weetas, the CEO of Al Dar Properties and Developments, one of the biggest Abu Dhabi-based developers, Talal Al Dhiyebi, commented on the strategy by saying that it reflects how the government seeks to accelerate the emirate’s economic growth and support its property market, adding that re-evaluating Abu Dhabi’s regulations and rules for infrastructure, residential and commercial projects is a significant step towards cutting the industry costs for both residents and investors.

Conclusion and summary: The reasons and the impact of this economic reform

According to a report by The National, this major initiative has been analyzed as following:

Why?Government officials were set a 90-day deadline to put economic reforms in motion as part of a Dh50 billion stimulus package over three years. The aim is to diversify Abu Dhabi beyond its reliance on oil income and cement its status as a growing world power.

What is the plan? Tomorrow 21 is a four-point plan to shape the economic future of the capital. The idea is to:

Stimulate business and investment, as well as promote economic development for the private sector and small businesses and support industry projects for the renewable energy sector.

Improve the lives of UAE nationals by launching new housing projects and providing quality education at an affordable cost.

Develop the knowledge sector by encouraging technology companies, supporting research and development centers, and training and developing talent and expertise.

Enhance the quality of life for all through improved cultural, sporting and transport initiatives

How will it affect jobs? The package will also include the creation of 10,000 new jobs for Emiratis in private and public sector over the next five years, while dual licenses will be available for companies in Abu Dhabi free zones to allow them to work outside free zones and bid for government tenders.

UAE leads Middle East countries by total hotel rooms in construction

The Middle East room construction total represented a 27.4% increase compared with October 2017 according to a report released by STR.

Rooms in construction in Africa, however, is down by 2.3% year over year.

The Middle East has a total of 423 hotels in the construction pipeline with 127, 177 keys which up by 27.4% compared to October 2017. Out of that, the region has 127 properties in final planning stage with 191 properties in the planning stage.

Africa has a total of 139 properties in construction with 65 of them on final planning stage and 121 in the planning phase.

UAE takes the lead spot among top MENA countries by rooms in constructions as of October 2018 with 54,371 keys making up 33.5% of the existing supply. Saudi Arabia takes second place with 48,224 rooms in construction but leads in terms of overall growth with the construction making up 51.4% of the existing supply as of October 2018.

Oman has 4,471 rooms in construction which tallies to 24.4% of the exiting supply while Egypt has 3,925 hotel rooms in construction which is 2.3% of the current supply.

Geda and Potain hoist partnership

Tower cranes from Potain will be fitted with the Geda Potain Cab-In internal mast crane operator hoist as part of a new supply agreement.

With more than 100,000 cranes sold and more than 60 models produced in France, Italy, Portugal and China, Potain has evolved since its early beginnings in 1928 into a world market leader.

The two traditional companies collaborated closely in the development of the Cab-In, exclusively for the Potain top slewing crane. It is based on the Geda 2 PK crane operator hoist that has been on the market for several years.

The new internal mast Cab-In enables a fast route to and from the cab. It fits inside all crane mast systems and is compatible with all Potain bases and drive frames. It also increases cost efficiency since the hoist remains permanently in the crane avoiding any additional transport costs and separate storage areas being required at the installation site.

The Cab-In is easily accessible and therefore easy to maintain and service. For additional safety Geda and Manitowoc have also developed a new, enclosed sliding landing level safety gate specifically for the hoist.

Johann Sailer, managing director of Geda, said, “Always with our eyes on the market, one of our ultimate objectives is to offer our customers tailor-made height access solutions. Our existing expertise in crane operator hoists along with the exclusive collaboration with Manitowoc, has enabled us to develop the Geda Potain Cab-In, a product that precisely reflects the customer’s requirements and which already meets the future legal regulations coming into force in France.”

The market launch of the Cab-In is planned for the end of 2018 but it already complies with French regulations, which from 2019 will make the installation of a crane operator hoist obligatory for every crane with a lifting height of 30m. The hoist also complies with regulations in the Netherlands and in Scandinavia.

Since the partnership Manitowoc and Geda have agreed a five-year deal for several hundred devices. Existing Potain cranes are to be retrofitted with the new hoist.

MEA smart city spending to double in next four years.

Annual technology spending by smart cities in the Middle Eastand Africa (MEA) region is expected to double from $1.3 billion to $2.7 billion in the next four years, according to KPMG’s ‘The Rise of Smart Cities – Digital Transformation in the Public Sector’ report.

Addressing the Digital Saudi 2030 conference in Riyadh, Dr Samer Abdallah, head of digital, KPMG Al Fozan & Partners in Saudi Arabia, revealed that Riyadh and Dubai are the top spenders when it comes to the development of smart cities.

“Given the Saudi government’s move to embrace digital transformation in alignment with Vision 2030 and the National Transformation Program 2020, information technology (IT) spending in the kingdom is slated to grow by at least 14 per cent each year,” he added.

Global smart city spending is set to accelerate from $81 billion in 2018 to $158 billion by 2022, Dr.  Abdallah said, citing data from International Data Corporation.

The critical success factors of digital transformation of a city include an individual strategy, a holistic approach, and technology partners. This entails, however, several challenges such as cyber risk, technology gap, funding gap, and skills gap, which need to be appropriately addressed.

r. Abdallah advised assembling a dedicated cross-functional transformation team; describing the future vision of a smart city and deriving the related digital transformation projects; selecting appropriate technologies and detailing the business cases; identifying suitable partners among tech providers and co-investors, and executing consistently under one governance, and allowing for agile project delivery as the model to building a smart city.

In another presentation on ‘The Race to the Cloud: Present and the future of cloud platforms in fuelling Artificial Intelligence’, Dr. Abdallah said: “As Saudi Arabia makes great strides to build a sophisticated digital infrastructure under its Vision 2030, cloud computing will be a catalyst for digital transformation.”

Cloud computing will play a key role in promoting Artificial Intelligence (AI), and Machine Learning (ML) as these technologies are adopted across the broader business spectrum, he said, emphasising that companies will increasingly use AI-based cyber defence systems to detect and fend off any cyber-attacks.

Dr Abdallah pointed out that data analytics is becoming increasingly important tool for businesses, particularly Business Intelligence, as modern business problems require the analysis of large and complex combinations of data sources and sophisticated data models.

When The National was launched in 2008, the UAE was best known for spectacular building projects: an indoor ski slope, and islands shaped like continents and palms.

The rate of construction was so remarkable that an urban myth was told of a Keralite crane operator named Babu Sassi, whose crane on the Burj Dubai was so tall that he lived in the cab at the top.

At the time it was widely reported that Dubai was home to a quarter of the world’s 125,000 cranes. (It was actually no more than 2 per cent.)

Building and infrastructure would transform the landscape and social fabric of the country over the next decade in a manner made more astonishing by the backdrop of the 2008 global financial crisis and the Arab uprisings.

Boom time: a decade when the cranes ruled the UAE’s skies 

When The National was launched in 2008, the UAE was best known for spectacular building projects: an indoor ski slope, and islands shaped like continents and palms.

The rate of construction was so remarkable that an urban myth was told of a Keralite crane operator named Babu Sassi, whose crane on the Burj Dubai was so tall that he lived in the cab at the top.

At the time it was widely reported that Dubai was home to a quarter of the world’s 125,000 cranes. (It was actually no more than 2 per cent.)

Building and infrastructure would transform the landscape and social fabric of the country over the next decade in a manner made more astonishing by the backdrop of the 2008 global financial crisis and the Arab uprisings.

The month The National was launched the Burj Dubai, as it was then known, reached level 160 and became the world’s tallest man-made structure. But within a few months, the effects of the 2008 global financial crisis hit.

Major infrastructure projects including the 52-kilometre Metro, enabled the city to withstand the effects of the crisis, says Dr Yasser Elsheshtawy, an architect, historian and former professor of architecture at the UAE University. It would open a year later in September, 2009.

“It is as if the city’s central nervous system is starting to shoot signals to previously detached limbs,” National reporter Hugh Naylor wrote at the time.

A 14.5km tramline followed in 2014, connecting Sheikh Zayed Road with the Marina and Palm Jumeirah, and even now construction continues with a 15km extension to the emirate’s next big project – Dubai 2020 Expo.

The city is undergoing a renewed inward focus, Dr Elsheshtawy says, with projects such as the new creekside retail area of Marsa Al Seef. After a proliferation of malls, Dubai is now tending towards pedestrian-friendly, open-air retail outlets.

“In many ways the past 10 years have witnessed a maturation of the real estate market and a closer focus on livability – walkable areas, outdoor places for social interaction and mixed-use developments,” Dr Elsheshtawy says.

“A proliferation of cultural projects moves the urban development paradigm away from a profit-making paradigm.

“While admirable in many ways, there is a clear tendency towards focusing on the higher-end of the market, and the immediate impact and relation to the existing city is sometimes not studied carefully.”

Abu Dhabi

In 2008, Abu Dhabi’s Urban Planning Council began to implement Plan 2030, starting the capital’s transformation from an island city to a city of islands.

When The National was launched, there were two crossings into the city – the Maqta and Mussaffah bridges. But there were plans for 32 more connecting the main island with Reem, Maryah, Yas and Saadiyat islands.

The 10-lane, 1.4km Sheikh Khalifa bridge to Saadiyat opened in October 2009, just before the first Formula One GP on Yas Island. It connected the Corniche to Saadiyat Island, Yas and the E11.

The mainland satellites of Khalifa City, Mohammed bin Zayed City and Mussaffah were linked to the Corniche by the 2010 opening of the 800-metre Sheikh Zayed Bridge, designed by celebrated British-Iraqi architect Zaha Hadid.

In late 2012, the much-anticipated, Dh5 billion Salam Street expressway, later to be renamed after the Founding Father, Sheikh Zayed, was completed after more than five years of construction.

Meanwhile, 80 metres underground, the Dh5.7bn Strategic Tunnel Enhancement Programme was under way. With 91km of sewers, it is one of the longest gravity-driven wastewater tunnels in the world.

Changes were not without growing pains. In its early years, The National reported extensively on the effects of the Salam Street tunnel building and another infrastructural innovation – paid parking. The Mawaqif paid parking scheme was introduced in October 2009. As parking lots were plotted out, drivers spent evenings circling for hours.

“It wasn’t ever intended to be a revenue-generating operation. It was a way to get all these cars off the streets,” says Dr Jane Bristol-Rhys, an associate professor of anthropology at Zayed University.

In the Western Region, later renamed Al Dhafra, life improved with the upgrade of the 327km Mafraq-Ghweifat motorway to the Saudi border.

In 2014, the region launched the country’s first railway and commercial operations began on the 264km line from the Shah oil and gasfields to Ruwais port. Plans for a trans-Gulf passenger line were held.

Running in the opposite direction, from sea to desert, is a water pipeline to the 21 billion litre underground reservoir in the Liwa desert near the Empty Quarter. The Dh1.6bn project, finished in January, is the world’s largest reserve of high-quality desalinated water.

End.

Sources:

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The Rise in the Construction of Power Plants in the GCC

The economic and the population growth in the GCC in the past few years have increased the demand for more power and consequently an increase in the construction of power plants in the GCC. In this report we will look into the value of the construction of power plants in the GCC and the biggest projects that are underway in the region.

According to a report by Arabian Business, GCC power construction deals is set to exceed $23bn in 2018. New report says Saudi Arabia will lead the way on contract, accounting for more than half of total.

The value of power construction contracts awarded throughout the GCC in 2018 is forecast to reach $23.6 billion, according to a report by Middle East Electricity, the region’s annual international trade event for the power industry. The figure represents a substantial 41 percent increase on 2017. The report highlights that Saudi Arabia will lead the awards ranking, accounting for 59 percent of contract value, followed by the UAE and Kuwait.

“This upsurge in the value of contracts reflects the vibrancy of the region’s power sector where governments are looking to meet spiraling demand – between 7-8 percent a year,” said Anita Mathews, group director – Industrial Portfolio at Informa Exhibitions, which organizes the event.

The report said the GCC will require a spend of approximately $81 billion for generating capacity, transmission and distribution over the next five years with that investment likely to be prioritized despite any prevailing economic headwinds.

GCC Power construction contracts to soar by 41 percent

According to a report by Saudi Gazette, Energy Storage & Management Solutions joins four other specialized sectors at the show including the Transmission & Distribution, Power Generation and Lighting stalwarts, as well as Solar, which joins the MEE (Middle East Electricity) line-up as a dedicated sector after six years as a co-located event.

As the GCC power contract investment pipeline readies for 2018 growth, the MEE report forecasts the renewables sector is on the rise as the region pursues economic diversification policies.

“GCC countries are shifting towards renewable resources for energy generation to preserve their oil wealth. Currently, renewables form the fastest growing energy source for electricity generation. GCC countries are investing heavily in renewable energy to achieve significant targets by 2030-2040,” states the report.

The drive towards renewables is just one emerging trend in a region where the power sector is, according to Mathews – group director of industrial portfolio at Informa Exhibitions, witnessing tectonic transformation.

“Change is the name of the game with the region being driven by a new economic impetus and proving more responsive to changing fundamentals, including falls in the price of solar, storage and wind power,” said Mathews. “This transformation is impacting all, at every level. Technology advances now see buildings serving as thermal batteries. This seismic shift is seeing new businesses and astounding innovation enter the industry as it moves from a highly-regulated sector into a fiercely competitive one.

“Consequently, there are a host of amazing opportunities in new technology and systems optimization, and the global industry has acknowledged the regional prospects. They have chosen to make their market and advanced product entries at Middle East Electricity, which itself is morphing into a beacon of change, signaling what we can expect in the short, medium and even long-term from the power sector and how it will impact all our lives,” added Mathews.

The rise of waste-to-energy in the GCC

According to a report by Gulf Business, the oil price drop of 2014 has left a lasting legacy, with diversification plans across the GCC reshaping not just energy industries, but entire economies, societies, and business landscapes.

Yet it is the energy industry that has perhaps felt the tremors of these seismic changes in the most profound way, as governments try to break what Saudi Arabia’s Crown Prince Mohammed bin Salman describes as an “addiction to oil”.

As a result, a wider range of energy sources than ever before have come to prominence, with solar, wind, hydro and other types of energy emerging across the region. One of the most promising avenues is waste-to-energy (WTE) – a process that not only generates significant levels of energy, but also tackles a major problem for the region.

“Across the GCC, governments are actively pursuing strategies to achieve zero waste,” says Khaled Al Huraimel, group CEO of Sharjah-based environmental and waste management company Bee’ah.

“Average levels of waste per capita per day in the region stand at 1.65kg, and with the rapid urbanisation of the Middle East, waste production in the region is only expected to increase.

“Waste-to-energy projects will enable us to tackle this insurmountable problem of waste, in addition to meeting our energy needs and creating value out of discarded materials.

The rise of several new waste-to-energy projects in the region exhibits the responsiveness of the GCC market to waste-to-energy initiatives.”

One of these projects was confirmed earlier this year when Bee’ah formalised a partnership with clean and renewable energy player Masdar to create the Emirates Waste to Energy Company (EWEC) and build a WTE facility that will incinerate up to 37.5 tonnes of solid waste per hour – adding an extra 39MW of green energy to the Sharjah electricity grid and providing power to thousands of homes.

It was a big step in the company’s WTE ambitions, and is set to complement the firms existing projects and initiatives, which include the region’s first – and the world’s largest – gasification plant.

The facility has the capacity to process around 160,000 tonnes of non-recyclable waste annually – generating a gross output of 35MW of energy that can be used to power around 50,000 homes.

“This facility will enable Sharjah to become the first city in the region to achieve ‘zero waste-to-landfill’ status, in addition to achieving the UAE’s 2021 goal of diverting 75 per cent of solid waste away from landfills,” says Al Huraimel.

According to another report by The National, The UAE is aiming to generate 75 per cent of its electricity from renewables by 2050, while Saudi Arabia,the world’s biggest oil exporter, has ambitions of adding 9.5 gigawatts (GW) of renewable energy to the grid by 2023, which approximates to ten per cent of its energy mix.

“I fully expect the kingdom of Saudi Arabia to announce their energy mix for 2030 and in that mix, I fully expect to see a significant amount of renewables – 40 to 50 per cent levels,” said Paddy Padmanathan, chief executive at Riyadh-based power and water developer Acwa Power.

“Saudi Arabia is the sort of later entrant to this reality but it’s a big volume and this will be the most exciting.”

The analysis below by the International Renewable Energy Agency, can give a clear picture of the renewable energy market in the GCC:

Top 5 GCC power and water projects

To conclude the report, we are looking into the largest power and water projects in the GCC and we have listed them here  – BNC Network estimates 48 power plant projects under construction as of October 2018 in the GCC. Here are some of these projects:

Saudi Arabia: Jizan Economic City (JEC) – Power Plant (Actual value: US$3.4 billion)

CPI Power Engineering was awarded the main construction contract in November 2008. Construction of the 2 400 MW captive power plant started early this year and is expected to be completed in 2013. It is intended to power an aluminium smelter in Jizan Economic City. The city itself is 725 km south of Jeddah and will include residential, commercial and industrial zones. The economic city will be built in phases and is expected to be completed by the end of 2020. The Aluminum Corporation of China (Chalco) signed an agreement with Malaysia’s MMC Corporation and the local Saudi Binladen Group to develop a 1 million ton per year aluminum smelter in November 2007.

Saudi Arabia: Jubail IWPP (Actual value: US$2.5 billion)

The independent water and power plant in Jubail Industrial City will be made up of four blocks and based on combined cycle generation gas turbines. The extraction steam will supply the desalination plant, which will have 27 units employing multiple effect distillation technology. When operational, the plant will produce 2 745 MW of power and 800 000 m3 per day of desalinated water.

These resources are destined for Jubail Industrial City and the Eastern Province of Saudi Arabia. The project is being developed with on a build, own, operate and transfer basis. The Seuz consortium was awarded the construction contract in December 2006. The consortium is a joint venture between Suez Energy International and Saudi Arabia’s Acwa Power Projects.

UAE: Hassayan power and desalination plant (Actual value: US$2 billion)

The Dubai Electricity and Water Authority’s Hasssyan power and desalination complex is planned to be a huge plant made up of six stations (P1, P2, Q1, Q2, R1, R2) each with a gross capacity of around 1 500 MW and between 100 – 120 million gallons per day of desalinated water. Configurations on the drawing board include gas turbines with associated heat recovery steam generators, auxiliary boilers, backpressure steam turbines and MSF desalination units. The project will also include infrastructure for water storage and distribution.

UAE: Nuclear Power Plant : Barakah Nuclear Energy Plant

The project involves construction of a nuclear power plant with a capacity of 5,600 MW in Baraka in the Western region of the capital city. It will include four nuclear reactor plants each with capacity of 1,400 MW. Unit 1 is slated for completion in five years, with commercial operations commencing in 2017, pending regulatory approval. The project upon completion will enable UAE to meet a quarter of its electricity needs from safe, clean, efficient and reliable nuclear energy, and save up to 12 million tons in carbon emissions each year. The project is estimated at 40 billion US$ and NFT has had 60 tower cranes installed throughout the multiple phases of the project.

Bahrain: Al Dur IWPP (Estimated value: US$2 billion)

The Al Dur power and desalination plant in Bahrain is being developed on a build, own, operate basis by a consortium composed of GDF SUEZ and Gulf Investment. The project has seen lucrative contracts awarded to large international players and will be located at Al Dur. The plant will consist of a combined cycle gas turbine power plant and a reverse osmosis desalination plant, together with all support facilities such as seawater intake and discharge structures and gas connection.

Oman: Al Duqm IWPP (Estimated value: US$2 billion)

The Al Duqm IWPP is currently on the books as the first coal-fired power plant in the GCC. If it goes ahead the proposed plant is expected to have an electricity capacity of 1 000 MW.

Kuwait: Az Zour South 3 Power Plant Expansion

The project involves the expansion of Az Zour South 3 power plant from open cycle to combined-cycle mode. The plant is located in Kuwait and is operated by the Ministry of Electricity & Water (MEW). The expansion will increase the total installed capacity of the plant by 263 megawatts (MW) without using any additional gas.

Az Zour South 3 began operating as an open cycle power plant with two SGT5-4000F gas turbines in 2015. After the steam turbine expansion, the hot waste gases of the gas turbines will be used to produce steam which will feed the turbo set. This will increase the plant’s total capacity without any additional gas consumption and will boost its efficiency significantly.

Dar Al-Handasah to build first commercial Hyperloop system in Abu Dhabi

Design and engineering firm, Dar Al-Handasah has been appointed to head construction of Abu Dhabi’s first commercial Hyperloop system.

Dar Al-Handasah will act as design lead on the project heading at team including fellow Dar Group members: Perkins+Will (architects, USA), T.Y. Lin International (engineers, USA), GPO Group (engineers, Spain) and Currie & Brown (cost management consultants, UK), said Hyperloop Transportation Technologies in a statement. Construction of the Hyperloop commercial track as well as HyperloopTT’s XO Square Innovation Center and Hyperloop Experience Center is targeted to begin in Q3 2019.,

“We are extremely honoured to be part of this global movement in mobility and rapid transportation and are looking forward to collaborating with HyperloopTT to deliver a truly iconic project in Abu Dhabi,” said Talal Shair, chairman, Dar Group.

HyperloopTT confirmed it had signed an MoU with Aldar Properties earlier this year for the construction of a new HyperloopTT centre including; a full scale commercial Hyperloop system, an XO Square Innovation Center and Hyperloop Experience Center. The proposed site within Aldar’s Seih Al Sderieh landbank is also conveniently located on the border of the Emirates of Abu Dhabi and Dubai, close to the Expo 2020 site and Al Maktoum International Airport, according to HyperloopTT.

Dubai Creek Harbour construction site uses anti-collision crane tech

Details have been revealed of the anti-crane collision technology being used on the construction site of Emaar’s Dubai Creek Harbour project. AMCS Technologies is providing its systems for the 59 cranes working on Dubai Creek Harbour’s Island District.  AMCS’s DCS 60 anti-collision and zoning systems are managing the equipment, which is helping nine contractors avoid interference with their cranes.  Among the project challenges AMCS is helping to mitigate is the proximity of different luffing and topless cranes on site. Due to the interference caused by this number, the construction process may be hindered by collisions between jibs and counter-jibs and jibs and cables.

Explaining the technology’s functions, Radoine Bouajaj, sales director at AMCS Technologies, said: “Anti-collision and zoning systems are essential for this spectacular project. The DCS 60 guarantees site safety by managing prohibited areas and interferences between cranes. It makes the work even easier by displaying useful settings for operating the crane.”

End.

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