Ali Hamad Al-Shamsy, the UAE undersecretary of housing and public works, blamed the absence of a competent regulatory system for the fact that most major construction projects in the country are awarded to foreign contractors. Al-Shamsy added that local contractors and entrepreneurs are not adequately familiar with the engineering issues involved in such projects.
Al-Shamsy said that the UAE government is currently investing 16 billion dirhams in construction on an annual basis, a large portion of which is then taken out of the country because of the act that foreign companies control the sector. Moreover, the undersecretary also said that the construction industry is rife with corruption, which needs to be rooted out in order to protect the pubic interest.
Traditionally, the companies involved in the UAE construction industry have been of US, European and Japanese origin. But, over the past two years, a mounting challenge has come from South Korean firms, many of who found themselves with spare capacity because of a downturn in the Southeast Asian markets. The South Koreans were able to gain a foothold in the UAE rapidly, largely because they were prepared to undercut significantly the prices being quoted by their competitors.
According to the MEED, construction activity in the UAE is expected to remain slow over the first half of 2000, but an upturn is projected during the second half—largely as a delayed reaction to the rise in oil prices during the second half of 2000.
One of the most ambitious projects about to get underway is Abu Dhabi Water & Electricity Authority’s 1,500-MW, 100 million-gallon-a-day Shuweihat co-generation plant in the western region. At least three international groups are expected to submit proposals by mid-February for the project.
In Dubai, the emirate’s Electricity & Water Authority (DEWA) is expected to invite consultants to bid for the grassroots co-generation plant during the first quarter.
The Federal Electricity & Water Authority is planning to add 260 MW of new power capacity at two separate sites in Fujairah. Fujairah will also be the location of a 100 million-gallon-a-day desalination plant, to be built at Qidfa. Some 10 contractors will be invited to bid on the Qidfa job. — ( Albawaba-MEBG)
© 2001 Mena Report (www.menareport.com)
