The peace agreement has just been signed in Egypt and we are already thinking about the reconstruction of Gaza, a huge investment foreseen by the peace agreements, which will yield several billion dollars in orders to companies operating in infrastructure and construction.
A first tender for 170 million dollars has already been launched for the most urgent health services, while there is talk of a monstrous sum of 80 billion dollars for reconstruction. The wait for the granting of large contracts for construction, healthcare and energy is galvanizing the construction sector in Piazza Affari as well as in other European markets, with positive effects on various listed stocks.
The World Bank estimates investments of 80 billion
Updated World Bank estimates put reconstruction costs for Gaza at around $80 billion, up from the previous forecast of $53 billion made in mid-February, spread over ten years. A figure that equates to approximately 46 thousand dollars per inhabitant. Around 20 billion will be spent in the first three years to try to restart Gaza.
This is four times the combined GDP of the West Bank and Gaza Strip before the outbreak of the war (2022). An amount that will have to be spent to get the infrastructure back on track, starting with electricity, and for healthcare. The World Health Organization predicts that more than 7 billion will be needed to restart health services. It is estimated that around 30 billion will be spent on the reconstruction of houses, schools and electricity networks.
First reconstruction contracts already awarded
The World Bank and the United Nations Development Program (UNDP) are preparing the first contracts for reconstruction, starting with the removal of rubble and the reconstruction of water and sanitation infrastructure.
The Arab League wants to be involved and has developed a plan for the reconstruction of Gaza, financed by Qatar, the United Arab Emirates, Saudi Arabia and Egypt, under the coordination of the World Bank and the United Nations. The European Commission has announced the signing of a 400 million euro credit line to support the economic recovery and resilience of the private sector in Palestine.
The companies involved in the works
Many groups operating in the Middle East are already moving to win large contracts in Gaza. These include the Egyptian Orascom Construction and Arab Contractors, the Lebanese Consolidated Contractors Company and the Turkish Limak Holding and Tekfen.
Many contracts will also arrive for US companies such as Bechtel, Aecom and Fluor, which deal with infrastructure, but also Caterpillar for the supply of heavy machinery.
Who profits on the stock market
The expectation of rich contacts is also inflaming the stocks listed on the stock exchange. Among the European big names, we highlight the big ones in the cement and construction sectors such as the Swiss Holcim (+3.5% on the week), the German Heidelberg Materials (+4.8%) and the French Bouygues (+2.8%) and Vinci (+1.7%), while the compatriot Saint-Gobain remains on the sidelines (-2.3%).
Among the most active stocks on Piazza Affari in recent sessions are Salini’s general contractor Webuild, which is not showing any big jumps for now, while Buzzi is inflamed, accumulating a gain of 5% over the week, and Cementir, which rises by 3.2% over seven days.
