Thursday, Feb 03, 2011
Gulf News
Experts weigh pros and cons for Saudi Arabian city after heavy rains cause massive losses
Riyadh: Economists and legal experts have estimated the value of rehabilitating Jeddah following the devastating rains and floods that hit the city in January to be as much as 6 billion Saudi riyals (Dh5.87 billion).
They said the government has lost confidence in the municipalitys capability to handle the job, adding that it may instead opt to hire foreign companies to do it.
In a statement to Gulf News, they added that businesses have lost 1.5 billion riyals in damage caused by power disruptions and the closure of streets leading to companies and banks.
Barei Ajaj, a financial expert and assets manager at Al Nufaiei Financial Group, said preliminary estimates indicate that the damage inflicted on commercial and industrial businesses as well as citizens and expatriates in Jeddah province may cost more than 1.5 billion riyals.
He said that losses included collapsed houses, damaged cars and other vehicles and disclosure of businesses due to heavy rains and floods. He added that some businesses are still suffering due to disconnected electricity.
Widespread damage
Dr Nabeel Abbas, member of the engineering arbitration committee at the Saudi Council for Engineers (SCE), said that rains and floods hit large areas including governing institutions like King Abdul Aziz University and municipal projects. This led to the disruption of water and electricity, sewage networks and oil pipelines.
Dr Abdullah Al Azzaz, a legal adviser, said that the governments confidence in the municipalitys administrative and technical apparatus was shaken, adding that this may prompt the government to reach deals with foreign, presumably Korean or Chinese, companies for the reconstruction of the city.
He said independent consulting offices have estimated the reconstruction cost to be 6 billion riyals. Al Azzaz blamed subcontracting for the fragile infrastructure.
He called for more transparency in the awarding of contracts while emphasising the need to refrain from awarding projects to subcontractors who lacked experience.
Mohammad Al Baidan, an economic adviser, said that those who were affected by the rains and floods have the right to be given shelter in the best neighbourhoods until the rehabilitation process is completed.
He urged the municipal council and the Human Rights Association to support those affected by rains and floods.
Meanwhile, a report released by the Saudi French Bank, Banque Saudi Fransi (BSF) estimated the losses at $4.5 billion, adding that insurance companies will pay $3.4 billion, or about 75 per cent of the total cost.
Rehabilitation
Barei Ajaj, a financial expert and assets manager at Al Nufaiei Financial Group, said preliminary estimates indicate that the damage inflicted on commercial and industrial businesses as well as citizens and expatriates in Jeddah province may cost more than 1.5 billion riyals.
By Abdul Nabi Shaheen, Correspondent
Gulf News 2011. All rights reserved.
