Drop in crude prices will open up new areas of services like alternative finance, says Neil Reynolds of CH2M
The crash in oil prices has created new opportunities for construction consultants in the Gulf, says Neil Reynolds, senior vice president and managing director of the project and programme management firm CH2M in the MENA region.
In an interview with Middle East Consultant, Reynolds explains that though fiscal policy adjustments by governments will have an impact on infrastructure, it will open up new areas of services like alternative finance.
“Governments are now looking to raise taxes and are looking to increase borrowing, which again creates opportunities because the bond market or alternative finance is back on the table. As a company, we advise clients in terms of alternative finance, so that’s another aspect that could be a growing business for us,” says Reynolds.
“Basically, I know if one hand is down the other hand is up, and I don’t think we all need to panic about the situation. I think it just creates new opportunities for companies like us to continue to prosper in the region.”
Reynolds also believes that consultants will target countries like Kuwait for future business opportunity as the Gulf state has always set its budget around $50 per barrel and thus, would have accumulated funds for development.
“In terms of the countries that are accelerating these plans in, and that we find attractive because of the services that we provide, are Saudi Arabia, the UAE and even Kuwait. In fact, Kuwait has always set its budget around the $50 oil per barrel mark so it has amassed funds where they can spend on developing infrastructure,” he says.
“I think Kuwait will also take advantage of the fact that there is a slowdown in the region. This means increased competition among players who will vie with each other to provide services for them, so I think the Kuwaitis are definitely going to capitalise on this infrastructure opportunity.”
Catch the full interview in the June edition of Middle East Consultant