Middle East and Africa Construction Chemicals - Market Share Analysis, Industry Trends & Statistics, Growth Forecasts (2024 - 2030)

Commercial end-user sector to lead the market in terms of growth

• In 2022, the infrastructure sectors of Saudi Arabia and the United Arab Emirates witnessed the highest surge in demand for construction chemicals, accounting for a 5% increase in value from 2019. The residential sector was projected to lead the market, with an estimated 6% increase in demand in 2023. Thus, the residential sector recorded the most growth compared to all other sectors in the region.
• Across the region, except Saudi Arabia and the United Arab Emirates, the industrial and institutional sector is the primary consumer of construction chemicals. Notably, flooring resins, concrete admixtures, and surface treatment chemicals dominate this segment, collectively accounting for 16% of the sector's demand in 2022.
• The residential end-user sector is the region's second-highest consumer of construction chemicals. Additionally, it is the highest in Saudi Arabia, with a share of 42% of the total consumption by all the end-user sectors in 2022. Concrete admixtures, surface treatment chemicals, and adhesives in 2022 made up most of the demand of this end-user sector in the region overall and in Saudi Arabia.
• Since Saudi Arabia and the United Arab Emirates have the most influence over the market in the region, and as their fastest-growing end-user sector in terms of demand for construction chemicals is the commercial, the demand consequently will likely grow the fastest in the commercial end-user sector at a regional level. The demand is estimated to record a CAGR of 5.83% during the forecast period (2023-2030).

Saudi Arabia's residential and commercial sectors to have the most impact on the market's growth in the region

• The construction chemicals market in the region witnessed a notable upswing in 2022, buoyed by rising oil prices and robust economic growth. This surge translated into a USD 150 million uptick in market value compared to 2021. The market further expanded by USD 277 million in 2023, with the residential and commercial sectors spearheading this growth.
• Saudi Arabia's dominance in the regional construction sector can be attributed to its stable political and legal framework, which attracts numerous construction firms seeking a conducive business environment. The country's abundant skilled labor pool, coupled with its status as a major oil producer, bolsters its already robust economy, further fueling construction activities. Consequently, Saudi Arabia emerges as the primary driver of demand for construction chemicals in the region.
• The United Arab Emirates (UAE) follows closely behind Saudi Arabia in terms of construction sector leadership. The UAE's attractiveness is bolstered by its consistent inflow of foreign direct investment (FDI), with 2021 seeing it secure the top spot in the region for inbound FDI.
• Within the Middle East & Africa, Saudi Arabia wields significant influence over the construction chemicals market. Given the anticipated surge in demand from its key end-user sectors, residential and commercial, Saudi Arabia is poised to witness the region's fastest market growth, with a projected CAGR of 6.18% during the forecast period (2023-2030).

Middle East and Africa Construction Chemicals Market Trends

High investments in modern office building projects by Saudi Arabia are expected to propel the new floor area for commercial construction in the Middle East

• In 2022, the Middle East & Africa witnessed a 3.56% decline in the new floor area for commercial construction, primarily due to surging steel prices and a fivefold increase in shipping costs post-pandemic. The United Arab Emirates bore the brunt, with a significant 42.20% drop in new floor area. The new floor area for commercial construction in the Middle East & Africa was expected to grow by 2.83% in 2023 compared to 2022.
• The COVID-19 pandemic led to an economic slowdown in 2020, resulting in the cancellation or postponement of numerous construction projects. Consequently, the new floor area saw a 5.32% dip in 2020 compared to 2019. As the restrictions were lifted in 2021 and construction activities resumed, the new floor area grew by 2.68% compared to 2020, with Saudi Arabia having the highest growth of 2.40%.
• The new floor area for commercial construction in the Middle East & Africa is expected to record a CAGR of 3.95% during the forecast period, with Saudi Arabia expected to record the fastest CAGR of 4.34%, following a trend of occupiers migrating from old office buildings to modern, well-maintained office spaces, and logistic parks. Furthermore, several office building projects like TECOM'S Innovation Hub Phase 2 in Dubai, spread across 355,000 square feet, are being developed to meet the growing demand for Grade A office spaces in the UAE. Additionally, Saudi Arabia will invest more than USD 10 billion in projects like Jabal Omar, Amaala, and Al Widyaa, among others, to bolster regional commercial construction.

Increasing investments in high-budget housing projects in the Middle East & Africa will likely drive the new floor area for residential construction

• In 2022, the residential construction sector in the Middle East & Africa witnessed a 2.25% growth in new floor area, driven by increased urbanization and a surging population's demand for affordable housing. This growth was projected to accelerate, with an expected increase of 3.89% in 2023, led by Saudi Arabia. As part of its Vision 2030, the Ministry of Municipal and Rural Affairs and Housing in Saudi Arabia rolled out initiatives to deliver 40,000 affordable housing units to Saudi nationals by 2025 and raise the homeownership rate to 70% by 2030.
• The COVID-19 pandemic had a notable impact on residential construction in the region. In 2020, as a result of lockdowns, labor shortages, disrupted supply chains, and reduced consumer spending, the new floor area saw a decline of 7.46% compared to 2019. However, as lockdown measures eased and construction activities resumed, the region rebounded in 2021, witnessing a 2.43% growth in new floor area compared to the previous year.
• The residential construction sector in the Middle East & Africa is poised for steady growth, and it is expected to record a CAGR of 3.05% during the forecast period. The United Arab Emirates is expected to register the fastest CAGR of 4.91%. Noteworthy projects, such as Saudi Arabia's NEOM, a mega-city with an estimated value of USD 5.60 billion, and the Al Quoz Creative Zone in the UAE, designed to provide housing for more than 8,000 residents, are expected to fuel the region's residential construction. By 2030, the new floor area is anticipated to reach 4.64 billion square feet, a significant increase from 3.6 billion square feet in 2022.

Middle East and Africa Construction Chemicals Industry Overview

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