The GCC construction market is facing pressure from cuts in government spending, late payments, increased overseas competition, bureaucracy and staffing challenges, according to a report from Meed.
Yet despite all that, the Dubai-based research house expects the sector to recover across the GCC by 2018.
The recovery would be helped by an improvement in crude prices, which Meed anticipates will hit $60 a barrel by 2018.
Brent closed on Friday at US$48.72 a barrel, while West Texas Intermediate closed at $47.75.
Additionally, Meed said, value-added tax will have been imposed in all six GCC markets, adding at least $20 billion to government incomes across the Arabian Gulf. National oil company restructurings will be complete and trade with Iran should have recovered. The UAE will be also looking forward to Dubai’s Expo 2020, Meed said.
“A lack of liquidity is the biggest issue facing the GCC construction industry today,” said the Meed editorial director Richard Thompson.
This could lead the market to “reinvent itself” through financing projects through public private partnerships (PPP).
“[PPP has] worked well in the power sector over the past decade and the opportunity now is to adapt the model for social infrastructure and transportation projects,” said Mr Thompson.
According to Mashreq Bank’s executive vice president and group head of international banking, John Iossifidis, the GCC has to refinance $94bn of debt over the next two years, of which $52bn is bonds and $42bn is syndicated loans, the large concentration of which is in the UAE and Qatar. This could lead to a tightening in regional liquidity amid recent downgrades from credit agencies and higher interest rates.
In Qatar, the value of new construction contracts awarded during the first three months of this year fell to the lowest level in more than five years because of the government cutting back on infrastructure spending thanks to lower oil prices.
Meed said last month that GCC construction contracts awarded in the first quarter fell to $830 million – a decline of 92 per cent year-on-year, and a 70 per cent drop on the previous quarter.
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Title: Assistant dean of students and director of athletics
Favourite sport: soccer
Favourite team: Bayern Munich
Favourite player: Franz Beckenbauer
Favourite activity in Abu Dhabi: scuba diving in the Northern Emirates
5 of the most-popular Airbnb locations in Dubai
Bobby Grudziecki, chief operating officer of Frank Porter, identifies the five most popular areas in Dubai for those looking to make the most out of their properties and the rates owners can secure:
• Dubai Marina
The Marina and Jumeirah Beach Residence are popular locations, says Mr Grudziecki, due to their closeness to the beach, restaurants and hotels.
Frank Porter’s average Airbnb rent:
One bedroom: Dh482 to Dh739
Two bedroom: Dh627 to Dh960
Three bedroom: Dh721 to Dh1,104
• Downtown
Within walking distance of the Dubai Mall, Burj Khalifa and the famous fountains, this location combines business and leisure. “Sure it’s for tourists,” says Mr Grudziecki. “Though Downtown [still caters to business people] because it’s close to Dubai International Financial Centre."
Frank Porter’s average Airbnb rent:
One bedroom: Dh497 to Dh772
Two bedroom: Dh646 to Dh1,003
Three bedroom: Dh743 to Dh1,154
• City Walk
The rising star of the Dubai property market, this area is lined with pristine sidewalks, boutiques and cafes and close to the new entertainment venue Coca Cola Arena. “Downtown and Marina are pretty much the same prices,” Mr Grudziecki says, “but City Walk is higher.”
Frank Porter’s average Airbnb rent:
One bedroom: Dh524 to Dh809
Two bedroom: Dh682 to Dh1,052
Three bedroom: Dh784 to Dh1,210
• Jumeirah Lake Towers
Dubai Marina’s little brother JLT resides on the other side of Sheikh Zayed road but is still close enough to beachside outlets and attractions. The big selling point for Airbnb renters, however, is that “it’s cheaper than Dubai Marina”, Mr Grudziecki says.
Frank Porter’s average Airbnb rent:
One bedroom: Dh422 to Dh629
Two bedroom: Dh549 to Dh818
Three bedroom: Dh631 to Dh941
• Palm Jumeirah
Palm Jumeirah's proximity to luxury resorts is attractive, especially for big families, says Mr Grudziecki, as Airbnb renters can secure competitive rates on one of the world’s most famous tourist destinations.
Frank Porter’s average Airbnb rent:
One bedroom: Dh503 to Dh770
Two bedroom: Dh654 to Dh1,002
Three bedroom: Dh752 to Dh1,152
The Specs:
The Specs:
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Torque: 600Nm
Price: AED 356,580 incl VAT
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Nayanthara: Beyond The Fairy Tale
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MATCH INFO
Newcastle United 1 (Carroll 82')
Leicester City 2 (Maddison 55', Tielemans 72')
Man of the match James Maddison (Leicester)
THE SPECS
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Transmission: six-speed automatic
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Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Sunday:
GP3 race: 12:10pm
Formula 2 race: 1:35pm
Formula 1 race: 5:10pm
Performance: Guns N' Roses
