Saudi Arabia's cement sector is facing a slowdown in demand due to the knock-on effect that the recent visa crackdown in the Kingdom has had on construction projects.
Efforts to boost Saudi employment in the construction sector has led to a two-pronged strategy by the government-clamping down on illegal workers in the sector and the implementation of a levy on every expat worker above a certain threshold.
However,a new report by NCB Capital suggests that this has led to a shortage of labourers,which is leading to delays on many projects.This has also resulted in a slowdown in the demand for cement.
It has given a Neutral rating on the sector due to the short-term slowdown in cement demand,which,when coupled with increasing imports,led to inventory reaching an all-time high of 13m tonnes in November.
