Major hikes in the cost of construction materials are forcing projects in Saudi’s holiest city Makkah to grind to a halt, according to a local newspaper report. The Al-Eqtisadiah paper reported that a sharp increase in the price of cement coupled with a rise in labour costs due to a dwindling number of skilled workers had forced several firms to call on the government to intervene. Last week, they did just that. The government reinstated its ban on cement exports from the country when it insisted that local producers ensure there was enough of the material to keep projects moving in the country. However, the crisis is deepening, and it’s spreading to major projects. Bassam Ghulman, associate professor of construction engineering and an expert in management of contracts and projects at Umm Al-Qura University, said a hike in prices of construction materials, especially cement and steel, was already having a detrimental effect on projects in the city. Several projects, including many mega real estate projects in the central Haram area faced major supply issues under the current cement crisis. Ghulman also said the cement price increases were central to the delay of many construction projects within their deadlines – as contractors refused to bow to pressure by suppliers to pay more. It’s not a question of supply, Ghulman said. “If we tap the optimum utilization of the productive capacity of cement factories in the Kingdom, we can meet the huge demand for this major construction material. Moreover, we have to ensure that all the sales and distribution outlets are making the product available to consumers at reasonable prices, ” he said. He also added that claims by producers over the shortage of raw materials for cement production were “entirely unacceptable” as the Kingdom “abounds in them”. “Moreover, the government is giving all incentives to producers, especially land to build factories at a nominal price, ” he said. Source: uaecement.com
Source:
http://www.uaecement.com/newsDetail.aspx?id=455
