Middle East contractors most impacted by Covid-19

GlobalData tracker finds regional contractors are most exposed to the downturn in construction activity

Contractors in the Middle East and Africa (MEA) region are most likely to be impacted by Covid-19 and related activity changes, according to GlobalData’s Covid-19 Contractor Impact Index.

The tracker is a measure of how exposed GlobalData’s 2019 Global 500 Contractors across seven global regions are to the downturn in construction activity stemming from the coronavirus outbreak.

China, despite being the epicentre of Covid-19, scores lowest on GlobalData’s worldwide regional tracker (-14.5 points), indicating that contractors in the country remain busy as construction and infrastructure work resumes.

Major construction firms have suffered a sharp drop in the market valuations amid the Covid-19 outbreak

Contractors in eastern Europe (-19.4 points) and northeast Asia excluding China (-21.4 points) are also among the least exposed to Covid-19’s impacts.

They are followed on the list by contractors in western Europe (-23.6 points); south and southeast Asia, and Australia (-25.5 points); and the Americas (-26.5 points).

Contractors in the MEA region, in contrast, scored -28.9 points on GlobalData’s index.

Regional breakdown

With a score of -64.9 points, Oman’s Galfar Engineering & Contracting Company will be the most impacted of contractors in the MEA market.

Galfar’s figure is almost three times the average score of -24 points assigned for all 500 contractors tracked by GlobalData.

Earlier this month, Galfar’s board appointed Hamoud Rashid al-Tobi as CEO, replacing Hans Erlings, whose employment was terminated on 29 April after 14 years with the company.

Galfar is followed on GlobalData’s index by Wilson Bayly Holmes-Ovcon (South Africa), Consolidated Contractors Company (Lebanon), Petrojet (Egypt), Aveng (South Africa) and Ghantoot Group (UAE).

Other regional contractors, such as Al-Jaber Group (-29.6 points), BIC Contracting (-31.7 points) and Saudi Binladin Group (-23.6 points), also feature on the regional index.

Commenting on market conditions, GlobalData’s report states: “Major construction firms have suffered a sharp drop in the market valuations amid the Covid-19 outbreak.

“GlobalData’s tracker of 50 major companies shows that the average stock prices dropped to a low of 64.9 points in late March, a fall of 38.4 per cent compared to the levels at the end of January.

“However, the markets have recovered some ground, ending April 21 per cent higher than the March low.”

Click here to access GlobalData’s Covid-19 Contractor Impact Index.

02 June, 2020 | .By NEHA BHATIA