RIYADH: The number of foreign contracting companies that have entered the Saudi market has reached 1,648 since the establishment of the Saudi Contractors Authority, while the total number of local and foreign contracting companies registered with the authority has reached 140,000 entities, according to information provided by the authority to Al-Eqtisadiah.
Saudi Arabia’s contracting sector contributes about 8 percent of gross domestic product, making it one of the country’s largest economic sectors. The value of its projects is expected to exceed SR3 trillion ($800 billion) over the next three years, Saudi Contractors Authority Chairman Mohammed Al-Ajlan told Al-Eqtisadiah.
He said Saudi Arabia has become a destination for contractors and projects due to its growing international presence and the broad participation of foreign companies, highlighting the strength of the Saudi economy.
He explained that mergers between contracting companies represent an important opportunity to increase efficiency and exchange expertise, particularly given the presence of major projects requiring cooperation between local and international expertise.
Standard contracts
Through the Ministry of Justice’s Preventive Justice System Initiative, the authority is working to make the use of standard contracts mandatory for the private sector in the near future. The measure aims to regulate the contracting sector and contractual relationships, preserve rights and reduce disputes between parties.
Standard contracts are defined as unified electronic contracting templates for the implementation of small and medium-sized projects in the private sector. They are intended to regulate contractual relationships, preserve rights and reduce disputes between parties.
Construction leads
Saudi Arabia’s contracting sector saw the launch of 472 projects last year. Building and construction led with 270 projects, followed by water and energy with 84 projects and infrastructure with 74. Industrial and oil and gas activities recorded the lowest number, at 22 projects.
In terms of project value, water and energy accounted for the largest share at more than SR79 billion, followed by building and construction at SR74 billion, infrastructure and oil and gas at SR36 billion, and the industrial sector at SR5 billion.
The authority reviewed a package of digital and regulatory initiatives it has launched, including the Muqawil, Ertiqaa, Wifaq, Jisr and Mimar platforms.
These initiatives aim to improve electronic services, increase companies’ readiness, facilitate dispute resolution and enable Saudi contractors to access foreign markets, reflecting the authority’s efforts to build an integrated digital ecosystem supporting the sector’s efficiency and sustainability.
The authority also said that modern construction methods contribute to reducing project implementation costs.
Sector outlook
The authority previously said that Saudi Arabia’s contracting sector has experienced continued activity since the launch of Vision 2030 and is worth more than SR855 billion, according to its figures. The authority has supported innovation in project implementation by encouraging the private sector and granting excellence awards to several contracting and construction companies.
Projects in the Kingdom have become more diverse and increasingly rely on specialized designs and technologies. This requires companies with strong capabilities in implementation, operation and maintenance.
According to Saudi Contractors Authority figures, contracting projects in the country grew by 40 percent this year compared with last year, with 200,000 contracting companies operating in the domestic market.
Saudi Arabia’s contracting sector is expected to remain active over the next 10 years, supported by projects linked to Vision 2030 and new developments associated with Expo 2030 and the World Cup in Saudi Arabia.
