The Business Year

Eng. Haitham M. Al-Refaei

KUWAIT - Real Estate & Construction

Factory Factors

CEO, Insha’a Holding

Bio

Eng. Haitham M. Al-Refaei joined Insha’a Holding as Projects Manager in 2005. He has held several positions since he joined and was promoted to COO in 2006. In 2008, he was promoted to Deputy CEO. In 2010, he became the CEO. He has a degree in civil engineering from Kuwait University, a master’s of civil engineering from the same institution, and an MBA from Ahliya University in Bahrain. His experience and expertise span over 23 years in the field of engineering, projects management, and business administration.

"Recently, the government announced a new plan depend on other sectors rather than only oil and gas."

What key developments have characterized the past year for Insha’a Holding?

Projects in Kuwait have been postponed for a while because of the relationship between parliament and the government. Until 2013, when HH the Amir changed the voting procedure, a new parliament came to be with a cooperative and integrative relationship with the government, meaning a variety of projects restarted. In 2014, the construction sector counted high profits because of the new rules, and 2015 also turned out to be a good year. However, by the end of 2015, oil prices went down and the government initiated new fiscal policies and cut costs to avoid a budget deficit, which led to a fair amount of projects having been cancelled or postponed. In 2016, the move of the wheel has slowed down. So far, compared to our neighbors like the UAE or Saudi Arabia, Kuwait is still doing well. As a construction company, we feel that lots of Emirati or Saudi companies try to enter the Kuwaiti market to compete. From last year to this year, most of our projects have been with the government, including the oil and gas sector. Just recently, we finished the Kuwait Oil Sector Hospital and the head quorate Kuwait Authority for Investment, and we ran several projects with the Ministry of Public Works, General Authority of Housing, the oil sector, and the private sector. So far, we have seven subsidiaries in Kuwait and three associated in Oman. In Kuwait we have SandCo Company and Bayan Company, supplying the market with sand and other gatch and agricultural soils. These two companies have about a 50% market share in Kuwait. We also have Boubiyan Ready Mix. It is a landmark factory producing concrete for most high-tech projects in Kuwait. This company is the one that received an award from American Society for Concrete. Boubiyan Aggregate imports aggregate from the UAE and conducts aggregate trades in the Kuwait market. In addition to that, Tasheed owns the Kuwait Tower factory, which produces interlock, pavement tiles, concrete tiles, and cement blocks. We produce additives for concrete and all chemical for construction materials at our company, EPO Gulf Company. We have a good market share even though we only recently established the company in 2010. In 2015, we established Insha’a Ahliyah Real Estate Company. This company is specializing in investing and managing industrial real estates.

There are many Saudi and Emirati construction companies entering the Kuwaiti market. To what markets are you looking to expand?

We currently have three companies in Oman with a share of about 25%. Our main Omani subsidiary is a company called Global Mining, producing raw gypsum. We also started a company called Global Gypsum, which takes the raw material to produce gypsum powder. Then, in 2010, we established Global Gypsum Board, which produces all kinds and type of gypsum boards. Now we are in the process of establishing new factory in order to manufacture artificial stones and marble and this belongs to a new company recently been established called Global for Marble. We have already ordered the production lines for the factory and hopefully by early 2017 we will start production. However, it should be mentioned that most of our material is merely produced in Oman and then exported to Indian, African, and Asian markets. We utilize Salalah Port, one of the biggest regional ports with excellent facilities to export our products.

What is your outlook for the real estate and construction sector in the year ahead?

Recently, the government announced a new plan depend on other sectors rather than only oil and gas. We have seen lots of movement recently. Hopefully, this gives an indication that the government is serious about this, and it is not only a matter of propaganda. Recently, the state has applied a reduction of subsidies program from the consumption of water and electricity for most sectors except for industrial ones. In my opinion, this is a message that the government is still supporting these sectors. Next year, we will have an election and nobody knows what will happen next. We have had three good, stable years, wherein relations were good, integrative, and cooperative. We can see the results in the market and the economy. Hopefully, the new elections will be positive, but I cannot give a solid answer and I am encouraged to invest into the non-oil sector. But let’s see about politics first.

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