An estimated US$4.2 trillion worth of construction projects are either planned or ongoing in the world’s megacities, according to a report by data and analytics company GlobalData.
The total of 6,645 projects set in motion were said to be fuelled by increasing urban populations and are sparking interest in residential and infrastructure developments.
The United Nations (UN) has forecast that between 2016 and 2030 the percentage of the world’s population living in cities with at least a million inhabitants is likely to grow from 23% to 27%, and the number of megacities is projected to jump from 31 to 41.
GlobalData’s listing of 50 Construction Mega Cities suggested that each city has a pipeline of projects with an investment value of more than $30 billion.
Dubai, in the United Arab Emirates, tops the list with $374.2 billion worth of projects being rolled out. It is closely followed by London, UK, with $328.7 billion worth, and then Moscow with $191.5 billion of construction projects.
Yasmine Ghozzi, an economist at GlobalData, said, “The ranking of Construction Mega Cities in the Gulf states shows they are spending the most on major development projects relative to the size of their populations. Dubai, for example, has a population of 3.2 million, but it holds the top position in terms of the value of the construction mega-projects pipeline per capita.”
Ghozzi added, “The number of people living in Doha has increased to 1.1 million as the Gulf state recruits tens of thousands of workers to work on major infrastructure projects linked to the 2022 FIFA World Cup; their project pipeline valued at $105.6 billion.”
However, the Asia-Pacific region dominates the list, accounting for 25 of the 50 cities listed, and having a combined pipeline of projects valued at a staggering $1.7 trillion.
It is also interesting to note that there are significant differences among the 50 cities on the list in terms of the value of their project pipelines relative to the size of their economies.
Ranked in these terms, Visakhapatnam, one of India’s largest ports and an important industrial town, came out tops. This was attributed primarily to the Indian government’s push on infrastructure and affordable housing.
Ghozzi said, “The two main cities in Vietnam, Hanoi and Ho Chi Minh City, also feature in the top 10 ranking of cities in terms of the value of the project pipeline in relation to the city’s economy. Ho Chi Minh City’s economy recorded high economic growth in the first six months of 2018, with the construction industry recording growth of 7.7%. The city is expected to grow by around 8.8% a year, ahead of Hanoi (8%) and many other major cities in the region – outside of China and India – between 2018 and 2022.”