United Arab Emirates : Industrial Services Get a Boost in the Middle East as Plant Owners Seek Operational Efficiencies.
Industrial plant owners in the Middle East are increasingly recognising the value of industrial services as privatisation is encouraging the implementation of global best practices. This rising end-user awareness about the gamut of industrial services, along with the influx of global know how, is expected to spur the growth of industrial services market.
New analysis from Frost & Sullivan, Strategic Analysis of the Middle East Industrial Services Market, finds that the market earned revenues of USD 549.3 Million in 2013 and estimates this to reach USD 818.5 Million in 2018, at a compound annual growth rate of 8.3 per cent. The study covers the Middle East market for industrial service of pumps, motors, compressors, automation, instrumentation and electric drives.
Plant owners eagerness to ensure maximum asset utilisation, plant productivity and profitability coupled with stipulations by external agents such as process licensors have stoked the adoption of modern maintenance practices. The demand for service from the growing installed base and subsequent maintenance requirements will continue to be crucial to the overall market growth.
The tangible benefits of improved operational efficiency, lower life cycle costs and overall plant safety encourage end users to invest continuously on services, said a Frost & Sullivan Industrial Automation & Process Control Research Analyst. Additionally, the rising population and strong economic growth will stimulate investments, contributing to the growth of industrial services market in the Middle East.
End-users also notice substantial revenue opportunities in services; so much, that they have begun to accept project (equipment installation) orders at lower margins, with expectations of gains from after-sales services. Several original equipment manufacturers (OEMs) are utilising service offerings as a differentiator in an increasingly homogeneous market.
Although services are playing an increasingly important role in the business strategies of end users, it is possible that the reduced global demand for crude from the Middle East will affect the investments planned in the Middle East. The geo-political instability in the Middle East may further dampen investor sentiments and impede greenfield and brownfield investments.
While on one hand the lack of investments hampers the industrial services market, on the other, it encourages end users to resort to maintenance services to make the optimum use of their aging infrastructure. In a competitive market, offering timely and high-quality services is crucial, so service providers will be looking to have an efficient local set-up for services and sales.
2014 Al Bawaba (Albawaba.com) Provided by SyndiGate Media Inc. ( Syndigate.info ).
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|Date:||Aug 20, 2014|
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