01 June 2016
JEDDAH: About 20 percent of construction firms have closed down, while 50 percent have swiched over to maintenance, operations and electrical areas over the past eight months.
There is a recession in the industry resulting from fewer development projects caused by less money being spent on state development projects and some in the private sector, with Saudization falling to 10 percent, according to Abdul Hakim Al-Khalidi, chairman of the contractors committee at the Eastern Province Chamber of Commerce and Industry.
Al-Khalidi said contractors have moved to other sectors such as maintenance, operations and electric cables because they may be promising enterprises in years to come, he was quoted as saying by a local newspaper.
Abdullah Radwan, chairman of the construction committee at the Jeddah Chamber of Commerce and Industry, said that 40 percent of the companies in the industry are facing serious problems because of the low oil prices and the proposed tax on unused land. Raed Al-Oqaili, former chairman of the committee, said the recession has hit 30 percent of small contractors, with 50 percent starting maintenance and operations companies.
© Arab News 2016