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The UAE’s construction sector remained "firmly positive" going into 2023, which will continue throughout the year, according to the Royal Institution of Chartered Surveyors' (RICS) Global Construction Monitor Q1 2023 report.
The top-line construction activity index (CAI) reported a net balance of +41, down from +49 reported in the previous quarter.
Workloads in the private residential sector contributed the most overall to the positive picture (+51 net balance), while infrastructure workloads reported a net balance of +45. On the other hand, private non-residential projects reported a +29 reading.
"Crucially, the entire sector continues to report 'firmly positive' readings for construction activity," the report said.
The net balance for profit margins is expected to remain strong at +40, RICS said.
Like the global construction sector, some of the most prominent factors holding back activity are material costs, skills shortages, and general financial constraints.
Comments from professionals in the UAE indicate concerns about the overall resource demands of the region, with large infrastructure projects in neighbouring states enticing workers out of the country.
There are also some concerns about high temperatures and the prospect of it lengthening construction times and increasing costs over the summer months.
"Overall, the UAE’s construction sector looks strong and continues to demonstrate resilience as it weathers the storms shrouding the global economy and geopolitical instability," the report noted.
(Writing by P Deol; Editing by Anoop Menon)
