Crisis Unites Construction Industry: If the First Stage in Addressing a Problem Is Recognising It, Then the Gulf's Construction Industry Took an Important Step Forward at the Arabian World Construction Summit in Abu Dhabi in Mid-February
Thompson, Richard, MEED Middle East Economic Digest
One of the most significant moments at last week's Arabian World Construction Summit (AWCS) came on the first morning of the event, when a straw poll of the 500 executives attending the summit revealed that 83 per cent of the industry thought that quality was being sacrificed to meet the pace of development in the region.
Of course, the survey was not scientific. But it would be a mistake to dismiss the result. The participants in the survey were almost entirely senior executives from major construction companies in the Gulf--people who see what is happening on building sites across the region.
The vote highlights a growing crisis in the Gulf construction industry--namely, that the industry is failing to keep pace with demand. The market is overheating and the result is falling quality and safety standards, soaring project costs and significant delays.
In more developed economies, this might not be regarded as a calamity because construction activity typically represents a minor segment of overall economic activity. In the UK, for example, construction accounts for about 8 per cent of gross domestic product (GDP). In the Gulf economies, its significance is far greater, and growing.
The real estate and construction sectors are leading drivers of growth. In the UAE, for example, the real estate and construction industries are predicted to grow by 24.4 per cent and 29.6 per cent a year by 2010, respectively. Together, the two sectors are expected to make up 23 per cent of the country's economy by 2010, compared with 16 per cent in …
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Publication information: Article title: Crisis Unites Construction Industry: If the First Stage in Addressing a Problem Is Recognising It, Then the Gulf's Construction Industry Took an Important Step Forward at the Arabian World Construction Summit in Abu Dhabi in Mid-February. Contributors: Thompson, Richard - Author. Magazine title: MEED Middle East Economic Digest. Volume: 52. Issue: 8 Publication date: February 22, 2008. Page number: 26+. © 1999 MEED Middle East Economic Digest. All Rights Reserved. COPYRIGHT 2008 Gale Group.
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