Contractors and trade creditors could now look forward to receiving pending payments for the on-going Nakheel and Dubai World projects, according to a government statement, that will help the country’s construction and building materials sector.
“In addition, the Government of Dubai is particularly focused on addressing the concerns of Dubai World trade creditors within the Emirate of Dubai. To help address these concerns, today the Government of Dubai is announcing that the remainder of the funds provided will be used for the satisfaction of obligations to existing trade creditors and contractors. Discussions with affected contractors will begin in short order,” Shaikh Ahmed Bin Saeed Al Maktoum, Chairman of the Dubai Supreme Fiscal Committee, said in a statement, while announcing that Abu Dhabi Government has injected $10 fresh liquidity to support Dubai Government in helping the emirate meet its challenges.
A number of contractors and suppliers have received limited payments while implementing major projects, creating a backlog. The announcement will help them in turn pay their suppliers and move forward with business activities.
“This is a very good news for the economy in general and the construction and building materials supply chain in particular,” Riad Kamal, chairman of Arabtec Holdings LLC.
“A lot of contractors have been waiting for this news and the release of the payments could help the industry in moving forward with the construction activities.”
Kamal, whose company is involved in major construction projects in Dubai, is currently building Al Furjan – a Nakheel project, with a contract worth Dh600 million. He admitted having payment delays.
“But we managed works and Nakheel has been making part payments,” he said.
“We have executed a number of projects for Nakheel. Currently we are constructing villas at Al Furjan.”
The payment will help all those in the construction supply chain manage their businesses in time of crisis, including building materials suppliers, banks and financial communities, he said.
This will also help major international contractors, including Van Oord – which has a Dh16 billion contract to raise the Palm Deira from the Gulf, among others.
