Value of contracts less than $30bn<\/p>\n
PIF<\/a> accounts for only 14% issued<\/p>\n Focus on AI and digital infrastructure<\/p>\n The value of construction contracts issued in Saudi Arabia plummeted last year to less than half of that in 2024 amid cutbacks to the Public Investment Fund\u2019s<\/a> budget and a reprioritisation of projects, according to industry bodies.<\/p>\n The total value of contracts issued across the kingdom in 2025 was less than $30 billion, almost 60 percent below the $71 billion issued in 2024, according to data released by the Saudi Contractors Authority.<\/p>\n Contracts issued by PIF fell at an even sharper rate. The sovereign wealth fund<\/a> accounted for more than 38 percent of all construction contracts by value in 2024, around $27 billion.<\/p>\n Last year, it made up just 14 percent of total issued contracts.<\/p>\n The drop in contract issuances follows decisions made at the PIF to pare spending across its portfolio at the start of 2025. It coincides with a fall in the oil price, which dropped from an average of $83 a barrel in 2023 to begin this year at about $60.<\/p>\n The value of contracts issued in 2023 was $113 billion, according to the SCA, almost double that of in 2024 and more than four times the value of those issued last year.<\/p>\n \u201cIt was evident something was going on much earlier last year in terms of the drop in contract awards,\u201d said Tim Callen, a former IMF mission chief to Saudi Arabia. \u201cIt\u2019s in line with what you would expect, given the declining oil revenues. I don\u2019t think it\u2019s a surprise that the PIF in a sense has led the way on this.\u201d<\/p>\n PIF and government officials have recently indicated an intention to focus less on large infrastructure projects, such as Trojena and The Line<\/a>, and prioritise projects related to the 2034 World Cup<\/a> and 2030 Riyadh Expo.<\/p>\n Professional service companies working in Saudi Arabia say that budgets have been tightened, while the focus has shifted away from trophy projects.<\/p>\n \u201cThere\u2019s clearly going to be a lot of construction activity going forward, refocused away from the gigaprojects<\/a>,\u201d said Callen. \u201cData centres<\/a> is one area.\u201d<\/p>\n So far in 2026, the largest issuer of contracts has been the Saudi Data & AI Authority, a government agency charged with the country\u2019s digital infrastructure buildout.<\/p>\n