Ahmed Ezz, businessman and steel industrialist, is the founder of Ezz Steel, as well as a former member of Egyptian parliament. During his time in office, Mr Ezz served as Chairman of the Planning and Budget Committee, helping to steer Egypt through turbulent economic times and taking a keen interest in a variety of issues affecting public finances. This article will outline global construction trends for 2022, with a particular focus on the Middle East and Egypt’s residential property market.
Published in the wake of a period of sustained, robust growth, Morgan Stanley’s 2022 Global Real Estate Outlook report anticipated that the global growth rate would fall from 6.1% in 2021 to 4.7% in 2022, with growth remaining strong in the United States at around 4.6% in 2022 versus 5.5% in 2021. The report also predicted market buoyancy across Europe and the UK, matching the US at 4.6% in 2022. Meanwhile, in Japan, growth was predicted to be somewhat more modest at around 2.9%, as the country continues its path towards economic normalisation through 2022.
According to industry research and statistics shared by Construction Business News, the Middle East construction market is steadily gaining momentum despite rising construction costs and supply chain disruption. Following economic recovery throughout 2021, Middle Eastern economies have rebounded. This recovery has been led for the most part by a surge in energy prices as global demand for natural gas and oil has increased, triggered largely by the post-COVID-19 return to normality and resumption of international travel. Although inflation remains a major concern for economists, businesses, policymakers and the general public in many countries, in the Middle East, inflation rates have remained stable (at 4.7% year on year in Qatar in May 2022 and 2.5% and 2.3% in the UAE and Saudi Arabia respectively).
Meanwhile, in Egypt, GlobalData estimates that the Egyptian construction market was worth circa $64.2 billion in 2021. The GlobalData report predicts that the country’s construction industry will continue to grow at an annual average growth rate of over 10% between 2023 and 2026, suggesting that key sectors of the economy’s construction market will include industrial construction, commercial construction, institutional construction, energy and utilities construction, and residential construction.
In Egypt’s residential construction market, GlobalData anticipates that growth will largely be driven by the development of fourth-generation smart cities, increasing the country’s residential area in line with its growing population and providing up to half a million new residential homes each year to keep pace with rising demand.