Construction Industry in UAE - Reader Comment

In response to one of my earlier posts, another blogger with direct experience left a comment.

Since  not everyone reads the comments (but nonetheless a larger number than those who post  comments), I'm repeating his post here because it has some important information and context.

Here's what the "RealNick" has to say on the subject.

And here's a link to his blog.

"Abu Arqala,

1) Yes, I 'live' in the construction industry...but

2) It is difficult to get exact figures and vetted information in this country (until after the fact)- not just for delayed payments. The media doesn't help - Zawya Dow Jones newswire is notorious for lazy background research.

[Example: You may remember the figures sloshing around in the UK media earlier this year about 200 million pounds being owed to "British contractors" - as per 'ACE', an 'association of consultancy and engineering'. Firstly, ACE represents some (but not all) consultancy and engineering firms in the UK, but NOT contractors (i.e. builders / constructions firms). That's a big difference. I was actually interviewed once by a BBC journalist who did not know the difference between a consultant and a contractor. (Perhaps because in the UK anyone offering a service as a self-employed entity is deemed a 'contractor'. or because the words both start with a 'C'. Coming from today's BBC this wouldn't surprise me). As a result the figures of outstanding payments to consultants (fees) and contractors (progress payments fr work, minus retention etc.) were completely muddled up. Of course, it could only be outstanding fees and not payments to contractors-$300m buys you maybe five 20storey buildings..hardly worth reporting!]

Noone in the industry knows anything for sure, Abu Arqala. It's all hearsay from the majlises.

There are too many consultants and contractors out there who cannot or will not talk frankly - unless they actually wanted to destroy their name in this country. Remember, most companies in this industry here are family owned businesses. They are here for the long term. They have personal associations. They have been licking sandals for too long to risk being seen as detractors.

We in the industry are often paid 'in kind' (both consultants /contractors). Outstanding payments are delayed for years and then "suddenly" you get awarded a new job without much trying! How do you put that on a balance sheet?

Ergo, the only figures you hear about are from the newcomers who wanted to ride the wave and are now stranded on a sandbank (often literally).

Generally, it seems the only people who burnt their fingers in Dubai are those who arrived during the boom years to make a fast buck but without any knowledge about the country and its mores..."