DAMMAM: Following a four-year decline in investments in the Kingdom's construction and contracting industry, the total value of the sector is now estimated at just $680 billion. With fresh investments drying up, contractors say that up to 40 percent of all government projects are currently stalled. Some contractors have suggested the creation of a "contractors bank" to support and finance their projects.
Fahd Alhamedi, head of the contractors committee at the Riyadh Chamber of Commerce and Industry, said that the current level of investment in the contracting sector is not proportional to the number of construction projects currently being implemented. He said there is need to inject finances into the industry in order for the government projects to continue. He said that before they take up a project, contractors now worry whether they would be able to pay their employees.
Alhamedi said that the stagnation in the construction sector affects all the other sectors that are linked to it, such as the industrial and transport sectors, as well as the employment field. He added that the contracting market is currently suffering under these critical challenges and the sector needs reforms. He said that the recession in the industry is due to the fact that banks are not financing the contracting sector because the Finance Ministry is not offering any funding to them.
Alhamedi said that the sector is a prime source of development and movement for the national economy, adding that "what we need to do now is complete existing projects that remain on hold, and not start new ones just yet.
‘Contractors bank’ urged to finance projects
‘Contractors bank’ urged to finance projects
