Saudi's building materials market is currently experiencing a boom driven by the synergy of policy and demand. Under the "Vision 2030" initiative, $1.1 trillion has been allocated for infrastructure funding. Mega-projects like NEOM ($500 billion) and the Red Sea Tourism Project are being launched, with contract awards for engineering projects reaching $149.5 billion in 2025. The construction sector's contribution to GDP is projected to exceed $100 billion.
Demand is surging on two fronts: the housing sector requires 660,000 new residential units and 320,000 new hotel rooms, while there is a shortage of 5.3 million square meters of commercial space. The 2027 Asian Cup and 2034 FIFA World Cup are further driving essential demand for venue construction. There is a significant gap in traditional building materials, with 40-45% relying on imports. Annual demand includes 14 million tons of steel, 51.15 million tons of cement, and the tile market size has reached $1.24 billion.
The market structure is rapidly upgrading, with green and smart building materials emerging as a new blue ocean. Policies mandate a 40% reduction in carbon emissions for new projects, fueling a 15-20% annual growth in demand for energy-efficient windows and doors and eco-friendly concrete. The smart home market is expected to reach $470 million by 2025. Prefabricated construction, due to its suitability for large-scale projects, is seeing increasing penetration rates.
International companies are actively competing for market share, with Chinese players being particularly prominent. Saudi Arabia offers incentives including 12%-20% tariff protection and a corporate income tax rate below 15%. Companies like CNBM and Conch Cement are capturing market share by establishing local factories. Chinese exhibitors at the 2025 BME building materials exhibition facilitated 35% of the transactions. Concurrently, GCC anti-dumping duties are pushing companies to shift from direct exports to local production, creating a new competitive landscape.
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