The market for Iraq Paints & Coatings is expected to grow at a CAGR of over 3% during the forecast period. Major factors driving the market studied are increasing investments in residential and commercial construction projects and government initiative toward redevelopment of public infrastructure over the next ten years. On the flipside, slower growth of the marine industry and affected economical and commercial activities due to COVID-19 pandemic, are the major restraints, which are expected to hinder the growth of market.
- Underlying opportunities on the back of insufficient power infrastructure to meet continuously growing demand is expected to offer various lucrative opportunities for the growth of market.
- By resin type, acrylic resin segment is expected to dominate the market owing to the increase in the usage in coating applications due to its properties such as transparency and UV resistance.
- By end-user industry, architectural segment is expected to dominate the market owing to increase in the construction activities in the region.
Key Market Trends
Acrylic Resin Type to Dominate the Market
- Acrylic resins have properties, such as transparency, high color ability, and UV resistance, in coating solutions. They are used in water-borne systems very often, which result in low VOC emission.
- The application of acrylic coatings leads to high surface hardness. In certain applications, such as walls, decks, and roofing, acrylic coatings provide elastomeric finishes to improve the UV resistance of the surface, if employed with some fluids.
- Application of acrylic coatings is primarily found in the construction industry, for high-end finishing in roofs, decks, bridges, floors, and other applications. Water-based acrylic coatings are high in demand, owing to the environmental concerns, like the negative impact of VOCs affecting the air quality in the environment.
- Apart from this, other applications of acrylic paints and coatings are found in marine vessels and structures, automotive, electrical products, machinery, and various metal product, among others.
- Owing to all the above-mentioned factors, the market for acrylic resins is expected to grow rapidly over the forecast period.
Increasing Demand from Architectural Segment
- Architectural coatings are the largest type of coatings used in Iraq, where the demand is extensively driven by residential and commercial construction activities. These decorative paints are either oil- or water-based paints, which are used for both interior and exterior applications for esthetic purpose. However, these coatings also help in protecting the structures from blistering summers, soaking rain, freezing winters, and UV radiation.
- Iraq stands to be an attractive market for builders and investors, owing to huge underlying opportunities in, both, the residential and commercial segments. After three continuous years of contraction in construction activities, 2019 observed various public as well as private projects and investments, which helped in reviving construction activities in the country.
- The country has been facing shortage of affordable and quality houses, with major scarcity observed in Baghdad, which is severely overcrowded. Considering housing shortage in Baghdad, the government embarked on its ambitious plan to construct Besmaya City, which is the largest housing project in the Middle East.
- The city planned is likely to be spread over a total area of 1,830 hectares, which aims to offer accommodation for about 500,000 occupants in a total of 100,000 residential units. Besides housing, the project also incorporates construction of other community infrastructure, such as hospitals and schools. While the project is already under construction, it is likely to significantly contribute to the demand for decorative paints and coatings over the next few years.
- In July 2019, Iraq approved plans for the development of a new city containing about 40,000 houses in the Southern port of Basra. The ministries of construction, housing, municipalities, and public works have collectively designed the infrastructure of “Al-Siyab City“, as a part of a post-war nationwide housing strategy. The project also includes construction of water and power facilities, hospitals, parks, mosques, schools, shops, restaurants, police centers, and other facilities.
- Decrease in tourism and delays in commercial projects due to spread of COVID-19 is likely to hamper growth of architectural sector. However, in the long run market is expected to recover at a steady rate.
- Some of the major companies operating in Iraq region are - Akzo Nobel N.V., Asia Paints Co. ltd., and Al-Tabieaa Company.
- The aforementioned factors, coupled with government support, are contributing to the increasing demand for architectural coatings in Iraq during the forecast period.
The Iraq Paints & Coatings market is consolidated with top players accounting for a major share of the market. Some of the key companies in the market include Akzo Nobel N.V., Al-Tabieaa Company, Caparol. MAS PAINTS & CHEMICAL INDUSTRIES, and Hempel A/S.
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