SAUDI ARABIA BAHRAIN UNITED ARAB EMIRATES QATAR OMAN KUWAIT
Construction An ITP Business Publication
WEEK
CONSTRUCTIONWEEKONLINE.COM
NOV 28–DEC 4, 2009 [298]
NEWS, ANALYSIS, PROJECTS, TENDERS, CLASSIFIEDS, AND JOBS IN THE MIDDLE EAST
INSIDE NEWS
Is property in lieu of payments acceptable? Some bosses think not PAGE 9
FREE ZONES
How will the new 100% ownership law affect free zones? PAGE 30
SHOWCASE
CW captures Burj Dubai in pictures ahead of its opening PAGE 38
BRIDGE OVER
TROUBLED
CW W VISITS JEDDAH’S SITTEN FLYOVER, A SLUM WHERE ERE WORKERS HOPE OPE FOR DEPORTATION
WORKERS
CITY FOCUS
The lla latest news, projects and tenders proje in Ya Yanbu, KSA PAGE 46
CONTENTS NOVEMBER 28-DECEMBER 4, 2009 | ISSUE 298 12
FEATURES
17
22 SPECIAL INVESTIGATION CW looks into the light of hundreds of runaway migrant workers who have spent months living under the Sitten bridge in Downtown Jeddah.
30 SPECIAL REPORT CW discovers the benefits of free zones and how a new ownership law could give foreign businesses more freedom.
19
DIRECTORY
14
38 SHOWCASE 40 TENDERS 41 PROJECTS 42 SPECIALIST SERVICES 30 21
REGULARS 2 ONLINE 4 MAIL
FRONT 9 THREE-QUARTERS OF ALL CONTRACTORS STRUGGLING TO GET PAID According to an online poll, 77.8% of respondents are facing serious difficulty getting clients to pay them for their work.
14 NEWS IN PICS Topical images with the latest news.
17 EVENTS
BACK
Industry dates for your diary.
46 CITY UPDATE
19 FACE TO FACE
Highlights of the week.
French construction suppliers talk to Construction Week about their journey to the Middle East.
12 THE BIG 5 NEWS
21 LEGAL
Highlights from the biggest construction exhibition in the Middle East.
KK Bose draws up a comparison between mediation and arbitration.
11 NEWS IN BRIEF
The latest news and projects from Yanbu, Saudi Arabia.
48 DIALOGUE Lytag managing director Andrew Doel discusses the advantages of lightweight concrete and how his company is progressing in the Middle East.
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
1
ONLINE
www.ConstructionWEEKonline.com MOST POPULAR
INDIAN PROFESSIONALS EARN BELOW ‘AVERAGE’ SALARIES ‘AVERAGE’ CONSTRUCTION SALARY IS $6047 PER MONTH AL HAMAD WORKERS STRIKE IN BAHRAIN TALLEST RESIDENTIAL BUILDING PAST HALF WAY ITCC: SAUDI’S SMART CITY
HAVE YOUR SAY HOW ARE YOU FINDING BIG 5?
What you think of this year’s show?
IN PICTURES: RESCUEING FROM HEIGHT
JOBS OF THE WEEK
Systech Solutions are now distributing rescue equipment from UK firm SpanSet. Demonstrators from the UK held an exciting simulation at the Al Habtoor Leighton Group Employees’ Education and Training School (Heets) in Dubai to show some of the best ways of safely retrieving a worker, should they fall from height. Falls from height are the most common accidents to happen on construction sites and although fall arrest equipment can reduce the risk of industry, should a worker fall, it’s vital to know how to rescue them to avoid further injury. For more images visit www.ConstructionWeekOnline.com
ONLINE POLL
FEATURES PMV
IMEC CHAMPIONS TECHNOLOGICAL INNOVATION Imec Electro Mechanical Engineering, which has been present in the region for 36 years, is pursuing some of the latest technological innovations in the HVAC market.
QATAR FOCUS There is still plenty of opportunity for suppliers, contractors and machine specialists in the once-sleepy country of Qatar.
Architect
Architect
ARCHITECTURAL HARDWARE Opening the door on the secret to creating a remarkable project.
Q&A WITH FLORIS SMITH DSA Architects’ newest director of architecture goes on the record.
CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
DOES YOUR COMPANY WORK WITH LOCAL UNIVERSITIES TO DEVELOP AND RECRUIT TOP TALENT?
33.6% 62.4% 4.0%
No, but it’s something that we’re looking at doing in the future.
MEP
2
Country Manager, Dubai, United Arab Emirates Senior Corporate Banker, GCC First Select International, Dubai, United Arab Emirates
No, we’ve no interest in hiring students in this region.
Yes, we work very closely to find ways to support and recruit graduates.
TO VOTE IN THIS WEEK’S SPOT POLL GO TO www.ConstructionWEEKonline.com
MAIL Regionally, you consider your salary to be…
The perceptions that exist are astounding. Perhaps some people are just worth more. Some qualifications were earned at a higher standard, and resulted in project managers from some countries having the opportunity to work on diverse projects thereby gaining significantly wider experience. This is portrayed as efficiency in projects. Look at the use of language in your comments. They are not what is expected from a senior project manager.
Globally, you consider your salary to be…
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RE: INDIAN PROFESSIONALS EARN BELOW ‘AVERAGE’ SALARIES Kudos to Construction Week for touching upon this subject. It is very true that Indians are paid below average salaries, not because they are not qualified enough, but because the industry here feels that westerners deserve high salaries. A westerner, fresh out of college, without any experience lands in the Middle East as a manager because he is a westerner. But an experienced Indian will always work under a ‘green’ westerner. K
Everyone knows that here the colour of the skin is very important. You may be a butcher or a fishmonger back home, but if you are white then you can be a manager here. This is not just for project managers; this holds true for all jobs, whether managerial or administrative or clerical. We Indians are only here to do the donkey work and yes, we are to be blamed for it. ZEN
Back in the ‘empire days’ whenever there was an
outbreak of any epidemic, the ‘empire administrators’ would decide that such a situation necessitated to be investigated by ‘an expert’ - and by ‘an expert’ it was always meant that a ‘body’ from UK had to come and investigate this. These so called experts could even be road sweepers in their home countries, but in the occupied countries of the empire, they were ‘experts’. This is a fact, and to some extent, this practice still continues today. CS
FRED
The situation became so unbearable that I had no option but to leave the company. People with whom I worked at this company are stuck with late payment of salaries and no other jobs to go to. The attitude these companies adopt is disgraceful with no apologies given to employees. The authorities need to clamp down heavily on these companies with severe penalties. If companies can not afford to pay their employees, then they should not be allowed to operate. ANONYMOUS
Salaries are related to the home country of the applicant. Why would you leave your home and culture for a job abroad that pays less than you earn in your home country? Colour is not the only factor. Many non-whites, born and educated in the west earn the same salaries as their compatriots. The current downturn in Europe and the US may change the dynamic, and staff will come for a paying job here when they can’t get a job at home. Salaries for them will be relative to the situation, not just their birthplace. AD
RE: DEFAULTERS TO BE PROSECUTED This situation is only going to get worse before it gets better. I worked for an MEP Contractor in Dubai for over 12 months and was receiving my monthly salary over two months in arrears.
RE: WORKERS STRIKE IN BAHRAIN It’s all around us, but unfortunately Al Hamad got exposed. I can show you 100,000 such labourers, oppressed with their mouths shut by management. It’s unfair to blame Al Hamad. MOHAMMAD TAHAFAZE
RE: DEVELOPER REACTS TO READER COMPLAINTS It’s a shame that Damac didn’t explain why the building was handed over two months before the air-conditioning was commissioned. Can they also explain why maintenance fees were charged from December when the building was not ready for handover until the end of January? Damac must face the fact they have behaved terribly and are despised by their clients. CRAIG
WRITE TO THE EDITOR Please address your letters to: Post, Construction Week, PO Box 500024, Dubai, UAE or email editor@ConstructionWeekOnline.com. Please provide your full name and address, stating clearly if you do not wish us to print them. Alternatively log on to www.ConstructionWEEKonline.com and air your views on any one of a number of the latest Middle East business articles. The opinions expressed in this section are of particular individuals and are in no way a reflection of the publisher’s views.
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CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
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FRONT
>News in brief
11
>Highlights from The Big 5
12
>News in pics
14
>Face to Face
19
>Legal
21
ONLY 22.2% OF RESPONDANTS TO AN ONLINE POLL SAID THEY HAVE HAD SOME DELAYS WITH PAYMENTS BUT CASH IS STILL COMING THROUGH.
THREE-QUARTERS OF ALL CONTRACTORS STRUGGLING TO GET PAID By Conrad Egbert
According to an online poll on ConstructionWeekOnline.com, 77.8% of respondents are facing “serious difficulty getting clients to pay” for work they carried out on projects with only 22.2% saying they’ve “had some delays but cash is still coming through.” Not a single participant in the poll clicked on the option “we’ve been fairly paid, and paid on time,” with most contractors in the region claiming to have had trouble getting some private and government clients to pay up money owed to them for projects they’re working on. Due to the economic downturn, many developers in the region have had finance issues, which have resulted in their being unable to pay contractors for work done. But contractors feel this is not good for the industry as it hurts the region’s image as a business hub. Some contractors like Besix have not tendered for the past nine months. “If we’re not getting paid, what’s the point in putting in a tender?” asks Philippe Dessoy
general manager Six Construct, which is part of a consortium working on the finishing touches on the Burj Dubai, scheduled to open on January 4. “We’re not a bank, we are providing a service and we expect to be paid for it. It’s simple business. If we’re not paid, how will our business survive and in the end that would affect any company’s decision to be here,” he added. Thomas Barry, CEO of Arabtec, which is the largest listed contractor in the UAE, also said that payment issues are an ongoing problem. “We’re trying to come up with various ways to overcome the issue but we’re still going around in circles,” said Barry. “We’ve been offered property in return but that’s not going to help us in any way as the property is being sold to us at boom prices which are not reasonable anymore.” Dutco Balfour Beatty general manager, Grahame McCaig said at the Construction Week Dubai Conference earlier this month
that property given in lieu of payments was not going to solve the problem. “Accepting property in lieu of payments won’t allow us to pay our sub contractors or maintain a workforce of people. We have to pay their salaries so we need cash, not property.” But Dubai’s Roads and Transport Authority (RTA) director of marketing and corporate communication Peyman Younes Partham told Construction Week that the RTA didn’t have these problems. “There’s a contract that binds any work that we do. We have been operating for four years and have spent over US $8 billion (AED30 billion) on different projects, so that’s a lot of contracts and we haven’t had any issues. “That’s because the RTA doesn’t have a habit of not honouring contracts, and neither do its partners. If we do a lot of projects, there’s bound to be a lot of work going on and some differences, but nothing that can’t be solved,” he added.
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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FRONT HIGHLIGHTS UAE
SUMMERTOWN HQ GETS LEED GOLD Design firm Summertown has won Leed Gold for its Jafza head quarters, making it the first UAE-based interiors company to win the accreditation. “As interior design and fit-out specialists of green interiors, it is vital that we lead by example. After successfully winning the Leed Gold rating we are in a position to efficiently assist companies who are keen on going green or try to convince others of the importance of having energy and environmentally friendly interiors,” said Summertown International managing director Marcos Bish. The office uses 35% less energy, up to 50% less water and diverts over 90% of its waste from the landfill compared to a conventional building. Egypt
DAMAC ISSUES NEW CAIRO TENDER Developer Damac has issued a tender for main contractor on its Hyde Park – New Cairo project for the construction
NEWS IN NUMBERS New office space in
2009 and 2010 in the UAE is worth US $22 billion, with estimated fit-out and interior design contracting spend at $2.7bn. In KSA, office space of around 8 million m2 is expected to grow between 20-30% by 2012
of 88 buildings with 320 villas, with nine Egyptian contractors having submitted bids. “We promised our clients luxury in all our projects, and the issuing of this tender is a major step in our development. The successful tender bid will be announced by mid-December 2009 and the successful contractor will commence immediately after,” said Damac Properties Egypt CEO Alaa Ayoub. Hyde Park was launched in December 2007. The grading works have been tendered and work has commenced on site. Damac claims it will deliver the first units by the end of 2011. UAE
SOROUH CALLS FOR GREENER REAL ESTATE Sorouh COO Gurjit Singh last week called for the industry to take an ‘early adopter’ approach to sustainability. Speaking at Meed’s Middle East Green Buildings and Sustainability conference, Singh said: “Sustainability should be an important part of any real estate company’s overall strategy in both the
GFT has won a contract to supply systems to the
$165 million Golf Gardens in Abu Dhabi – 33 low-rise and 389 villas
‘place making’ and ‘place management’ stage of the real estate value chain. “We believe that companies need to commit to a set of guidelines and today’s conference is an important catalyst for encouraging companies to make this happen.” Saudi Arabia
CMCS TO OPEN RIYADH OFFICE Collaboration, Management and Control Solutions (CMCS) will open an office in Riyadh before the end of 2009 in order to capitalise on opportunities in Saudi Arabia. Having already opened an office in Khobar this week, CMCS said it would target major projectintensive sectors in Saudi Arabia, such as engineering and construction, and select governmental departments. A recent report pegs the total value of ongoing and planned property projects alone in Saudi at around US $586 billion (SR2 trillion), representing 128% of the Kingdom’s GDP. “Project Portfolio Management is essential to the strategic
DSI has acquired
82% of PassavantRoediger, a global developer of wastewater, water and sludge treatment technologies with over 5000 installations and a presence in 13 countries in a deal worth $39.4m
realignment of the region’s project-based industries,” said Bassam Samman, CEO and founder of CMCS. UAE
SALARY DEFAULTERS TO BE PROSECUTED Companies that mislead the UAE’s Ministry of Labour over salary payments will be prosecuted, said Humaid bin Deemas, the ministry’s acting director general. “Each company must send through e-mail to the ministry a monthly report regarding their employees’ salary. If a company introduces its monthly report saying that they have paid the salaries on time, and then the ministry receives a complaint from any [person] in this specific company that they did not receive their salaries, this will lead to blocking the company.” In August this year a decision was issued by the Ministry of Labour, which stated that each company that employed more than 50 people must sign an undertaken at the ministry stating that they are paying the employees salaries on time.
KSA’s US$1.65bn Information Technology Communications Complex will cover 776,000m² once complete in 2012. In 2008, a $65mn contract was awarded to El Seif Engineering for construction of infrastructure for 487,000m² of the development
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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BIG 5 NEWS ROAD BUILDING KIT MAKERS SET SIGHTS ON MIDDLE EAST By Greg Whitaker International road building equipment we are all aware, are already being manufacturers are looking to the GCC built, notably the projects in and its many infrastructure works as Saudi Arabia. a way to shore up sales while demand “It’s a line which we are now exploring – asphalt equipment and paving falls in the rest of the world. “We’ve sold quite a few in Morocco and equipment.” Throughout a generAlgeria, but I really want this market” ally gloomy year, manufacturers of explained Antonio Alvarez from Mexican general construction equipment asphalt process equipment firm Triaso, have also seen sales rise in their road which was exhibiting at the Big 5 show in building range. Chinese conglomerDubai. “This is one of the countries that ate LiuGong is best known in this are still kind of thriving, from an infraregion for a long-established line up of wheel loaders but, according structure and roads point of view.” to the general manager Huang ZhaThe drop off in business through the ohua, it has been the firm’s line-up Americas has been harsh, according to Alvarez. “To give you some idea, we were of vibratory drum rollers that have selling eight machines per month last HOUSE OF EQUIPMENT GM WAIEL MANAFALUTI. seen the largest increase in sales year, and that’s dropped to three.” over the last year. House of Equipment GM Waiel Manafaluti agreed: “This type of equipment has seen a 30% rise in sales over “Many of the countries in the region need modification the last year, against a downturn of 30% in the market and improvement to the infrastructure whether it is roads, generally.” Major road building contracts are currently bridges or power supply and railways. All those infra- being offered in the UAE, Qatar and Saudi Arabia, with a structure projects will soon be released, and some, as number also being tendered in Oman and Syria.
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BIG 5 NEWS HIGHLIGHTS
DUBAI GOVERNMENT ASKED TO SAFEGUARD QUALITY By Matt Warnock Building companies have called upon the Dubai government to support their attempts to maintain quality within the industry. Al Rajhi Holding CEO Othmar Wutscher lent his weight to the Dubai government’s drive to introduce new, tougher build standards, but warned that any new regulations would also have to be strictly enforced in order to succeed. “They can’t just be on paper. Dubai has been built on quality, but with the economic downturn, there’s too much low cost engineering at the moment and buildings that may look good on the surface are anything but that inside. “We realise that, at this time, we need to be competitive but we also want to remain quality conscious,” continued Wutscher, speaking to CW at the Big 5. Cladtech International business operations director Bater ALRAJHI HOLDING CEO OTHMAR WUTSCHER SAYS QUALITY HAS TO BE PRIME. Biyouk agreed, adding: “We compromise a little on price which we’re able Quality curtain walling is a matter of using the to do at Cladtech [a curtain walls and cladding right material, in the right place at the right specialist], as we manufacture our own glass time – it has to be tested as a system, not as and steel; we can avoid the commission from individual parts. We support the government the middle men, but we never compromise on is any moves it makes to improve those tests quality. “However, testing has to be thorough. and standards.”
BRIGHT FUTURES FOR QATAR AND ABU DHABI By Sarah Blackman Construction suppliers now see Qatar and Abu Dhabi as the key places to do business, Big 5 exhibitors said last week. Investors are showing growing confidence in the Middle East, particularly Doha, where there is an opportunity to build new projects. “We supply foundation pumps for piling, shoring and dewatering and a lot of our business is going on in Qatar and Abu Dhabi now as there are new projects developing there,” said Austin Parfett Foundations sales manager Devanand, who predicted business to pick up in Dubai shortly.
Simon Mrad, MD of Wilo, a manufacturer and supplier of pumps and pump systems for heating, air-conditioning, cooling, water supply and sewage disposal agreed: “Local companies are investing in Qatar and Abu Dhabi. Developers and contractors feel comfortable starting new projects in the area because new developments are progressing at a steady pace and are not accelerating too quickly.” Mrad explained that The Big 5 gave his company an opportunity to show the industry what it can do.
MASA CELEBRATES MIDDLE EAST MILESTONE Machinery manufacturer, Masa Group has sold its 200th plant in the Middle East. “Our product range includes concrete block-making machines, aerated concrete machines and plants, and limestone plants. Around the world we have supplied more than 1000 block making machines and hundreds of aerated concrete and limestone plants. In this region, we have just sold machine number 200, which is a real achievement,” said CEO and chairman of the board, Masa Group, Dirk Bunthoff. ‘Plant No 200’ was showcased at the company’s stand at the Big 5. It was developed for Pasco, an Al Ain-based company that specialises in the construction of concrete blocks, concrete pavers and retaining walls. TAKING A HARDER LOOK AT CONCRETE The downturn has given concrete companies the chance to reassess their products and services. “There is no denying there has been decline in the industry, and there is no longer cash in abundance. But it is important that companies have been prudent, not just penny pinching,” stated CureCrete MD Tony Hogg. “The crisis has given us breathing space to refocus and make sure the things that are needed to be done to ensure good business are being done well,” he added. Hogg also said that building standards were an issue. “When you look at standards in the Middle East – they’re in place but it’s the guy on site who makes the final decision and it is hard to police that.”
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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FRONT
NEWS IN PICS
ABOVE: HH Sheikh Hamdan bin Rashid Al Maktoum (centre), deputy ruler of Dubai and minister for Finance and Industry, officially opened the Big 5 show on Monday November 23. The show ran until November 26 and this year’s edition saw a 15% increase in the number of exhibitors. VP of construction for show organisers DMG World Media said he was “delighted and greatly honoured” that Sheikh Hamdan opened the exhibition. RIGHT: Hundreds of immigrant workers – many of whom had moved to Saudi Arabia to work in construction – have been sleeping rough for weeks or, in some cases, months under the Sitten Bridge in the Kandarah District of Jeddah. Turn to page 22 to read Construction Week’s cover story. BELOW LEFT: Gulf International Trading Group chairman and CEO Khalid Mohammed Ibrahim Al Midfa revealed that his company would be taking part in next month’s United Nations Climate Change Conference in Denmark – being dubbed ‘Hope in Hagen’. Midfa said that his dream was to create homes that relied solely on natural energy. BELOW RIGHT: The joint venture between British architectural consultancies Barton Willmore and Buro Happold has completed the design for the King Abdullah International Gardens – the giant botanical garden project commissioned by the City of Riyadh as a gift to King Abdullah of Saudi Arabia to celebrate his accession to the throne. The JV won an international competition to design the gardens back in 2007.
14
CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
> For more pictures log on to www.ConstructionWEEKonline.com
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EVENTS
Event: FM Awards 2010 Overview: The facilities management Middle East Awards ceremony aims to help raise the profile of the industry and recognise and reward those who have made significant contributions to its development. Date: May Location: Dubai Phone: +971 4 435 6133 Email: annie.chinoy@itp.com Website: www.itp.net/events Event: Construction Week KSA Conference 2010 Overview: This one-day exclusive forum will gather top leaders from property developers and contractors alongside leading professionals from financial houses and law firms to discuss vital aspects of construction and real estate. Date: June Location: Riyadh Phone: +971 4 435 6127 Email: oscar.wendel@itp.com Website: www.itp.net/events Event: Middle East Architect Awards 2010 Overview: The Middle East Architect awards are an opportunity for the industry to come together and toast exceptional performance in architecture, engineering and design. Date: September Location: Dubai Phone: +971 4 435 6133 Email: annie.chinoy@itp.com Website: www.itp.net/events
Event focus
BUILDING SUSTAINABILITY CONFERENCE, DUBAI DATE: APRIL, 2010 LOCATION: DUBAI PHONE: +971 4 435 6127 EMAIL: OSCAR.WENDEL@ITP.COM WEBSITE: WWW.ITP.NET/EVENTS This conference places sustainability at the heart of the commercial business case where the efforts and resources engaged offer the highest returns.
Event: Saudi PMV Show Date: March, 2010 Location: King Abdullah Economic City, Saudi Arabia Phone: +971 4 435 6127 Email: oscar.wendel@itp.com Website: www.itp.net/events
Event: Building Sustainability Conference, Abu Dhabi 2010 Overview: Delegates from the world of construction are invited to a one day event to discuss the vital aspects of building sustainability. Date: October Location: Abu Dhabi Phone: +971 4 435 6127 Email: oscar.wendel@itp.com Website: www.itp.net/events Event: Construction Week Awards 2010 Overview: In its 6th year, the Construction Week Awards 2009 will celebrate excellence in the construction industry and exceptional performance in key areas of the sector, with nominations open to contractors, developers and consultants working in the Middle East. Date: October Location: Dubai Phone: +971 4 435 6133 Email: annie.chinoy@itp.com Website: www.itp.net/events Event: Construction Week Dubai Conference Overview: A one day event with two streams running concurrently covering the vital aspects of construction and real estate. Date: November Location: Dubai Phone: +971 4 435 6127
Email: oscar.wendel@itp.com Website: www.itp.net/events Event: CID Awards 2010 Overview: This year’s CID Awards will celebrate the success of the Middle East design industry and demonstrate how the region’s sector can stand alongside its international peers. Date: November Location: Dubai Phone: +971 4 435 6133 Email: annie.chinoy@itp.com Website: www.itp.net/events Event: MEP Awards 2010 Date: December Location: Dubai Phone: +971 4 435 6133 Email: annie.chinoy@itp.com Website: www.itp.net/events Event: Home and Life Style 2010 Date: March Venue: Oman International Exhibition Centre Website: www.eventseye.com Events: DWRW 2010 Overview: A trade show for doors, windows, roofs and walls, as well as cladding products, machinery and accessories. Date: March 8-10 Venue: Expo Centre Sharjah Website: www.eventseye.com Events: Saudi International Windows, Doors, Shutters, and Solar Exhibition 2010. Date: March 11-14 Venue: Riyadh Exhibition Centre Website: www.eventseye.com Event: Saudi Building and Interiors Exhibition and Symposium Date: April 4-7 Venue: Jeddah International Exhibition and Convention Centre Events: Buildex Syria 2010 Overview: Building, tourism, construction and real estate expo. Date: May 12-16 Venue: Damascus International Fairground Website: www.eventseye.com Event: Libya Build 2010 Overview: Construction conference for those interested in Libyan contracts Date: May 16-20 Venue: Tripoli International Fair Website: www.eventseye.com Event: Index 2010 Overview: Index is the Middle East’s largest contemporary interiors trade show. Date: TBC Venue: TBC Phone: +971 4 438 0355
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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FACE-TO-FACE SPEAKING FRENCH
JOUBERT PLYWOOD
CIAT MIDDLE EAST
General manager Michael Geoffroy
Area sales manager Mahidine Aït
TWO FRENCH COMPANIES TALK TO CW ABOUT THEIR JOURNEY TO THE MIDDLE EAST WHAT ATTRACTED YOUR COMPANY TO COME TO THE MIDDLE EAST? For us it is a new market and a new opportunity. Our main market is Europe but we also offer our products in the US, South Africa and New Zealand so we believe that we can also sell our product here in the Gulf. Although Dubai has been hit by the downturn, projects are still on-going there.
We are in the heating, ventilating and air conditioning industry so the Middle East is a huge market for us because air conditioning here is not a luxury, it is vital. Even the poorest man in his small apartment needs air conditioning.
WHERE IN THE MIDDLE EAST ARE YOU BASED? We are currently setting up a branch in Ras Al Khamiah Free Trade Zone. We have recently received our trade license.
We are based in Abu Dhabi and we have a branch in the north of Syria to cover the northern countries in the Middle East.
WILL THE NEW PROPOSED OWNERSHIP LAWS EFFECT YOUR BUSINESS DECISIONS? The law could give us more freedom, but we will see how things go. We have been trying to find the best way to set up our business here but there are so many different possibilities. We have a product that is of that is not sold in the UAE so we need to do the marketing ourselves. That’s why we decided to set up our business in a free zone. We have 100% ownership of the company.
It will be beneficial to us because it will give us 100% ownership. At the moment we have a sponsor. We are not based in a free zone. It was important for us to have a reputable office in the UAE. For me, a free zone is only suitable for warehouses. A sales office needs to be in a tower. I have no interest to relocate my company into a free zone.
WHAT PRODUCTS DO YOU OFFER? We offer plywood for many different applications including outdoor joinery works and for door manufacturing. We also have fire retardant plywood, which can be used for public buildings. It is very versatile and can be used for many different projects.
We are a district cooling provider. We have ice storage, which is a flexible solution for the management of important energy needs. We also have heat exchangers, which enable the transfer of water from the base of a building to the top. In addition we have fan coil units, which are the visible components of central air conditioning.
WHAT MIDDLE EAST PROJECTS ARE YOU CURRENTLY WORKING ON? We are looking to work within shopping malls. We have products like Joubert paint, which is very easy to implement into any project. We definitely want to do lots of work with architects, consultants to introduce our products to them and into new projects.
We are hoping to work on Jabal Omar in Saudi Arabia, which is a Saudi Oger project. We are trying to sell 15,000 units there. The contract will be awarded in 2010. We are also working on Hamad Medical City in Qatar.
WHICH MIDDLE EASTERN COUNTRY IS LEADING THE WAY, IN YOUR OPINION? There are still projects going on in Dubai and in Abu Dhabi. I think things in Qatar are booming and I have met some people from Kuwait who say that the economy is still going strong. Saudi Arabia and Oman are also showing signs of growth.
For me it is Saudi Arabia. It has not been badly affected by the financial crisis and it has much more new income and lots of projects. Princess Nora University, for example, is a huge project. We are also hoping to supply our systems for this.
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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LEGAL > For more legal advice log on to www.ConstructionWEEKonline.com/comment
Mediation lets parties solve their own disputes KK BOSE DRAWS UP A COMPARISON BETWEEN MEDIATION AND ARBITRATION AND EXPLAINS WHY MEDIATION IS QUICKLY BECOMING THE POPULAR CHOICE TO SOLVE DISPUTES
The UAE construction industry should use mediation, instead of arbitration or litigation, to resolve the technical disputes that abound in the industry. Though the principle of arbitration, as opposed to litigation, has been generally accepted in the region and arbitration centers have been set up, a major stumbling block is that arbitration tends to replicate litigation procedures. Arbitration often leads to a waste of time, and difficulties for the contestants, which arbitration was supposed to eliminate in the first place. Unlike in the common law countries, arbitration here is very expensive and time consuming. Instead of paying a court fee, which is US $8000 (AED30,000) on the higher side, a litigant ends up paying arbitration fees, which are huge in some cases, coupled with a court fee to ratify the arbitration award. And they end up going through the same procedures as they would have in court litigation. There are many chances of an arbitration award getting nullified by a court of law on various technical grounds. I am of the view that the legal profession is “selling” arbitration as an inexpensive and quick method of dispute resolution. But once arbitration starts, the disputing parties often find that they are going through the same procedures they would, were they to take their case to court. Normally, in litigation the judge gives judgment shortly after the conclusion of the case, whereas in arbitration, often the arbitrator gives an award many weeks or even months after the end of the hearing. There are instances that the arbitration awards are nullified by the courts due to delay caused by the arbitrators in delivering awards.
In litigation, if an expert body is to be consulted, the decision is taken fast and the matter referred to the expert as soon as possible. But in arbitration, the decision to refer to an expert body is often arrived at, after time consuming deliberations between the arbitrators. Most importantly, however, arbitrators are constrained by court procedures. Most of the disputes in the construction industry concern technical aspects, such as ‘reasons for delay’, ‘quality of materials supplied’ or ‘quality of work done’. Such cases do not require the detailed treatment of court proceedings or arbitration. These can be resolved on an ad hoc basis bypassing all matters irrelevant to the jurisdiction of a particular court, examining validity of trade licenses, asking for permission to sue a government body or department. Mediation can lead to a mini-trial and it gives an opportunity for the parties to exchange information as a prelude to settlement negotiation. Each party’s lawyer makes the presentation and thereafter settlement talks commence. If the parties cannot agree among themselves, then the neutral adviser may be called upon to give a non-binding opinion. It is important to recognise that mediation is not a legal process – the emphasis is put on empowering the parties to settle their own disputes themselves. Though mediation is not a legal process, it is finding increasing acceptance in the west, as well as in India because most technical disputes are founded on an inadequate understanding between the two disputants, and there is rarely a menacing intent on either side. Mediation will benefit the economy as technical disputes, which hold up payments, will be resolved expeditiously.
“UNLIKE IN THE COMMON LAW COUNTRIES, ARBITRATION HERE IS VERY EXPENSIVE AND TIME CONSUMING”
KK Sarachandra Bose is a partner/corporate, commercial and contract lawyer at Dar Al Adalah Advocates & Legal Consultants, Dubai. He has been in practice for over 30 years and advises several banks and corporate bodies. He is also a member of the International Bar Association and a visiting professor in International Business Law. He obtained his law degree from RL Law College, Belgaun, Karnataka, India.
The opinions expressed in this column are of the author and not of the publisher.
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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SITTEN
DUCKS CW INVESTIGATES THE LIGHT OF HUNDREDS OF RUNAWAY MIGRANT WORKERS WHO HAVE SPENT MONTHS, AND IN SOME CASES YEARS, LIVING ROUGH UNDER THE SITTEN BRIDGE IN DOWNTOWN JEDDAH Words by Benjamin Millington; Photos by George Dipin
I
f ever the failures of the sponsorship system for migrant workers in the Gulf were glaringly apparent, it is under the Sitten Bridge in the old district of Jeddah, Saudi Arabia. It is beneath this enormous concrete overpass where more than 1000 migrant workers live on the pavement with limited access to basic needs such as food and water, desperately hoping to be deported. Some came on pilgrimage to Makkah and stayed to work illegally, but many others were abandoned by their sponsors or ed abusive or non-paying employers. More than half are men mainly from Pakistan, India, Nepal, Sri Lanka and Bangladesh, who congregate in groups according to nationality. They came to work in the construction industry. The rest are a mix of Filipino and Indonesian women, who mostly came to work as domestic workers. They all sit on cardboard sheets huddled up together on one end of the bridge, waiting to be deported. Sudhakaran, a 28 year old Sri Lankan, says he has spent 17 months in Saudi Arabia, 10 of them under the bridge. He came to work as a construction labourer to support his wife and two young children, but left his sponsor who only paid him US $106 (SR400) a month, less than half of what he had agreed to. Like many others, he headed to the Sitten Bridge, a place which has become a well known recruiting ground for illegal workers across the kingdom.
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CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
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NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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OVER 1000 MIGRANT WORKERS, THE MAJORITY OF WHOM WORK IN THE CONSTRUCTION SECTOR, LIVE UNDER THE SITTEN BRIDGE (PICTURED) IN JEDDAH.
“I WILL WAIT HERE UNTIL THEY (SAUDI AUTHORITIES) CATCH ME. THIS IS WHAT EVERYBODY HERE WANTS” There he gets intermittent labouring work and earns a significantly better daily wage, but it is not without its pitfalls and he is still owed two months’ salary with no legal recourse to ensure he is paid. Now, Sudhakaran says he has no money and there is limited work. He survives on scraps from rubbish bins, begging in the streets and food donations. His ten or so friends, who are also Sri Lankan, share similar stories of employer abuse, hopelessness and misery. They have nothing more than sheets of cardboard and possibly some clothes. They are allowed to wash and use the toilet in the local mosque, but puddles of urine are everywhere and the smell ever-present. All the men say they want to go home, but don’t have money for the airfare, don’t have their passports or the crucial exit visas. Faced with this situation, Sudhakaran says the only option he is now left with, is to be caught by the Saudi police. “I will wait here until they catch me, I don’t know when that will happen, but I want it to happen now. This is what everybody here wants,” he says.
SUDHAKARAN SAYS HE IS WAITING FOR THE SAUDI POLICE TO PICK HIM UP AND DEPORT HIM BACK HOME.
THE SPONSORSHIP SYSTEM The sponsorship system is used in Saudi Arabia and most Arab Gulf states to employ foreign workers, who work under a sponsor/employer. The sponsor is responsible for the resident and must approve exit visas, without which they cannot leave the country. Workers are also not allowed to switch jobs without the consent of the sponsor. The system has
been heavily criticised by many human rights organisations since sponsors routinely confiscate workers’ passports and withhold salaries as methods of control. In August 2009 Bahrain was the first Gulf state to reform the system by allowing workers to freely switch jobs under certain conditions, but the reforms are yet to be proved effective.
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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Indeed, everybody seems to have the same goal, but “getting caught” isn’t easy. Forty-year-old Madhu from the Indian state of Kerala has been under the Sitten Bridge for more than two years. He says the police regularly patrol the area but won’t deport a person unless they pay. “There are agents for each nationality and if you pay them SR500 ($133) the police will pick you up and send you home,” he said. “Otherwise you have to wait for the passports office to send a van, these come every now and then, but they only take certain groups of people. This is what I am waiting for.” Until then Madhu said he would continue to work as an illegal labourer. He too said he ran away from his employer after not being paid his salary. As the gateway to Makkah and the more liberal of Saudi cities, Jeddah has become
somewhat of a last post for migrant workers without papers hoping to be deported. Several workers tell stories of paying money to be trafficked more than 1000km from Riyadh or Dammam, riding concealed in the back of utilities and trucks with other runaways. KK Vijayan from the welfare section of the Indian Consulate in Jeddah said the concentration of illegal migrants is high in the city, but is skeptical that any have lived under Sitten Bridge for longer than a few months. He describes it as a temporary problem, a quasi-waiting room for people wanting to
“THERE ARE AGENTS FOR EACH NATIONALITY AND IF YOU PAY THEM, THE POLICE WILL PICK YOU UP AND SEND YOU HOME”
be deported, which recently overfilled due to the Haj season when many overstayed their pilgrim visas. Even so, Vijayan concedes that it is difficult to get stranded migrants home quickly. While the consulate can easily issue new travel documents and even has mechanisms to pay for the return flights of Indian nationals, he said the exit visa requirements cause delays. “If they can’t get the exit visa signed by the sponsor then the only way is getting caught by the passports office, investigated and sent home. And because these people are in large numbers this takes time,” he said. “All the consulates are fighting to get the government to give some kind of an amnesty on the exit visas. Then we can wipe out the problem and send everybody home.” The government will apparently not declare an amnesty because of “security concerns,”
ILLEGAL MIGRANT WORKERS REST IN THE EARLY HOURS OF THE MORNING, HOPING FOR A MINISTRY VAN TO COME ROUND AND PICK THEM UP FOR DEPORTATION.
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“THE PROBLEM IS MUCH LARGER THAN THE BRIDGE AND HAS BEEN HAPPENING FOR THE LAST THREE DECADES”
MANY CONSTRUCTION WORKERS LIVE ON 6X4 SPACES WITH NO FOOD AND WATER UNDER SITTEN BRIDGE.
but even if they did, Vijayan admits it would only be a band-aid solution. “As soon as these 1000 people under the bridge are removed and sent back home, in ten days another 1000 will come,” he said. “The problem is much larger than the bridge and has been happening for the last three decades. The government is doing a lot but the problem is big. “Around 1.8 million Indians are living in Saudi Arabia and every year we issue around 30,000 temporary passports.” For many years human rights groups have been arguing that the only long-term solution to the problem is to reform the sponsorship system and the labour courts process.
Vijayan said he understands that the government is looking at various options. In the past, proposals have been put forward to transfer sponsorship from individual employers to a government agency or large labour agencies monitored by the state. Christoph Wilcke of international NGO Human Rights Watch (HRW) said either proposal would mark a significant improvement in conditions for migrants and the numbers who run away. At the same time he said the government must improve migrant access to the criminal justice system and enforce stiffer penalties on employers who flout the rules. “It’s been extremely hard to force sponsors to go to the labour court or pay up, they just
don’t go and the Saudi system now is just not interested in enforcement,” he said. “Until that happens, some sponsors will obviously just continue to mistreat workers.” One option which is being looked at is getting sponsors to pay a lump sum into an escrow account, which could be used when there are contractual violations and money needs to be paid to the worker. Wilcke believes such reforms need to be implemented now and in the meantime the Saudi government must address the wishes of all stranded workers who want to go home. “Under the universal declaration of human rights everybody has the right to leave his or her country and return to it. What is clear is that the government is not abiding by its own laws and international obligations,” he said. “The Interior Ministry must step in and waive the need for an exit visa, they do it all the time with criminals; it’s just a matter of political will.” Saudi authorities were unable to be contacted.
CONSTRUCTION CONCERNS The Sitten Bridge and other similar areas in Jeddah have become well known recruiting grounds for illegal labourers for the construction industry. One man said he regularly works in construction despite having no knowledge of or training in the industry, which raises concerns over occupational health and safety and the quality of construction. Last month a worker was killed and nine injured in Jeddah when a roof collapsed on a mosque under construction. The Civil Defense Department said the contractor was using illegal workers whose lack of experience in the construction sector may have caused the collapse. THE NEED FOR AN EXIT VISA IN KSA HAS FORCED ILLEGAL MIGRANT WORKERS TO REMAIN IN THE COUNTRY.
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CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
FREEDOM OF CHOICE THE MANY BENEFITS OF FREE ZONES CANNOT BE IGNORED BUT, WITH THE POSSIBILITY OF A NEW OWNERSHIP LAW COMING INTO PLACE, WILL CONSTRUCTION COMPANIES DECIDE TO TAKE THEIR BUSINESS ELSEWHERE? By Sarah Blackman
T
he fast developing Middle East has proven to be a key area of opportunity that is too good to miss for foreign investors hoping to expand into an international market and offer their services to the construction sector. Despite the downturn, projects are progressing in the region and there is still a demand for building materials, which is expected to increase as the economy gradually picks-up. But, where is the best place for these companies to do business?
SETTING UP SHOP Since their introduction into the UAE, free zones are arguably the best place to set up
30
shop. The main reason being – they play a vital part in the growth of the economy by allowing companies to operate with 100% foreign ownership and 100% exemption from income and corporate taxes. The construction industry is benefiting from this in two ways: the ability to set up in the UAE without altering their global company status and operational methods, and secondly, the ease with which foreign firms can operate in the free zones has meant a wider choice of international standard services and products are readily available in the local market. Free zones also provide easy access to airports and seaports, which is ideal for companies importing and exporting cargo. “We provide our clients with a key location at the apron of the busiest airport in the Middle East. This unique advantage offers
CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
unparalleled convenience to businessmen,” says Dubai Airport Free Zone (DAFZ) director general Mohammed Al Zarouni. “Easy access to the airport reduces cargo costs, which results in an increased profitability of products.”
SIGNS OF GROWTH The popularity of free zones has grown in recent months, even amid the global crisis, according to recent reports. “The market is improving,” says George Abraham, marketing manager of Global Resources, a consultancy firm, which helps foreign companies set up in UAE free zones. During the summer Abraham said monthly enquiries fell to around 200, but since Ramadan the market had improved and now they were receiving closer to 350 a month. Interest has mainly come from within the
> For more special reports visit www.ConstructionWEEKonline.com
“FROM JANUARY TO NOVEMBER 2009, WE HAVE REGISTERED 1662 COMPANIES FROM DIFFERENT SECTORS”
RAK FREE ZONE CEO OUSSAMA EL OMARI.
Middle East, mostly from Saudi Arabia and Kuwait and Qatar. “People are focusing mainly on the service industry and management consultancy busi-
ness. Manufacturing companies have also begun to come in again,” he observes. RAK Free Trade Zone (RAK FTZ) is one of the fastest growing free zones in the area with 7000 companies registered there since its establishment in the year 2000. “From January to November 2009, we have registered 1662 companies from different sectors,” says RAK FTZ CEO Oussama El Omari. “Next year, we are expecting to increase this number by more than 50%.” Business is also booming in Dafza. The firm reported a 48% increase in revenue during the first half of this year, compared to the same period in 2008. And, Al Hamriyah Free Zone (Hafza), Sharjah issued more than 100 trade licences monthly in Q1 of 2009, which shows a rea-
sonably sustained level of growth compared to 2008 when an average of 125 licences were issued monthly. “To date we have approximately 4500 companies from 132 countries, specialised
BENEFITS OF FREE ZONES • 100% foreign company ownership • 100% corporate and income tax exemption • 100% repatriation of capital and profits • Fast issuing of trade license, often within 24 hours • Exemption from commercial levies • Locations are adjacent to bulk trading and transit areas such as airports and seaports • Range of accommodation options on a lease basis • Simplified sponsorship and visa process for staff
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RAK FREE TRADE ZONE IS REPORTED TO BE ONE OF THE FASTEST GROWING FREE ZONES IN THE UAE. IT CURRENTLY HAS 7000 BUSINESSES REGISTERED THERE.
in heavy and medium manufacturing, to import, export and re-export as well as services,” says Hafza marketing director Hadi Kassem. Celebrations of success could soon be silenced, however, as proposed new legislations to allow international companies to hold 100% ownership of businesses any-
NEW LEGISLATION The UAE government is preparing legislation within the next month that allows investments in developing the country’s industrial base outside free zones with full ownership privileges for investors. Foreigners who set up industrial companies may be the first to have 100% controlling interests in their firms under the relaxation of ownership rules, according to recent reports.
where in the UAE could lead companies to move out of free zones.
CHANGES IN THE LAW At present, foreign businesses must have a UAE national as a sponsor and are limited to a maximum 49% stake, except in free zones. The move could give construction suppliers more freedom to choose a home for their companies, paving the way for technology firms to make large capital investments in the UAE and diversify the economy away from its present status. Also, as units outside free zones undergo a price correction, rental prices of units inside free zones are showing no signs of change. “We are yet to witness a drop in rental prices in Sharjah Airport International Free Zone (Saif Zone), which in time will make expansion unattractive in this zone,” says Bruce Shahabi, director of operations for Combisafe Gulf, a firm operating in Saif Zone, which offers safety solutions to construction sites.
“A recent increase in power charges does not help the situation either.” Dafza and RAK FTZ admits that its prices will not alter but are becoming more flexible. “Our prices stay the same, however we do consider payment terms for companies facing some difficulties,” says Zarouni. “This year we have been sensitive to the economic situation and applied a reduction on our fees, as well as adding value by
CURRENT OWNERSHIP LAW At the moment UAE law requires foreigners to have an Emirati as a sponsor and limits them to a maximum 49% ownership of businesses. The exceptions are free zones, where foreign companies can have 100% ownership.
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CONSTRUCTION SUPPLIERS OPERATING IN FREE ZONES IF THE NEW OWNERSHIP LAW IS IMPLEMENTED, FOREIGN SUPPLIERS COULD HAVE MORE FREEDOM.
COMBISAFE GULF – SAIF ZONE
TRIPLEFAST – JAFZA
including services at zero cost that would be otherwise charged. We are not planning to alter our price structure at this moment. In 2010 we will work on introducing a series of value added services designed to allow businesses to reduce their start up time and costs,” adds Omari. So, how will free zones remain competitive for national investors when or if the new legislation is implemented?
A manufacturer and supplier critical threaded fasteners and gaskets.
COMPETITIVE EDGE
A UK-based firm providing safety solutions, such as fall protection for construction sites.
NEWELL RUBBERMAID – DAFZA A supplier of industrial label printers, which can be used to label cables and to highlight dangerous machinery.
ISTA – DAFZA An energy and water consumption-based billing firm.
CLIPSAL MIDDLE EAST – SAIF ZONE A regional subsidiary of the Australian electrical accessories firm.
ONYX BUILDING SYSTEMS – SAIF ZONE A civil contracting company, which also manufactures steel and aluminium products.
“In my opinion, free zones will remain competitive for international investors seeking a base in the UAE, even after a proposed new law allows companies to operate outside their jurisdiction with full ownership rights,” insists Jebel Ali Free Zone (Jafza) chief commercial officer Ibrahim Al Janahi. “A company based in Jafza will have advantages over other companies as part of an established business community with excellent infrastructure services.” One of the key benefits that free zones offer is convenient access to various service companies that operate around them. Dafza Online Electronic Services is one example.
“This service was specially developed to cater to the needs of Dafza’s customers for speeding up all types of services required by them, which ranges from on-line proceeding of visa applications, residence, license, and the renewal of these documents,” explains Ophelia Pais executive assistant of Newell Rubbermaid, a supplier of labelling solutions, which operates in Dafza. Wherever foreign investors choose to lay their hats, it seems that international companies are driving the economy forward by offering their enterprise to the Gulf’s developing construction sector. The UAE has a strong head-start in this respect, as it allows international companies to work in the country independently, but its neighbours are already playing catch up. Saudi Arabia, for example, is working on establishing six economic cities to promote foreign investment. Planned free zones for the kingdom include Eastern Economic City, Hail Economic City and Madinah Economic City. The fact that Middle Eastern countries are willing to learn from developed countries reflects a maturing market and bodes well for the future of the construction industry.
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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¦SHOWCASE
CONSTRUCTION WEEK AWARDS 2009: Emaar’s tallest tower in the world, Burj Dubai won the award for Tower Poject of the Year. 38
CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
OLIVER LANG/AFP/GETTY IMAGES
TOP: Work on the Burj Dubai started in January 2004 and the tower reached 100 levels in January 2007. A month later, it surpassed the Sears Tower in Chicago as the building with the most floors in the world. Burj Dubai is now the world’s tallest building and tallest man-made structure, having surpassed the height of the KVLY-TV mast in North Dakota, US. The tower will be the first megahigh structure in which certain elevators will be programmed to permit controlled evacuation for certain fire and security events. RIGHT: The lights on the Burj Dubai have now begun to be lit up at night adding to Dubai’s already marvellous night skyline on Sheikh Zayed Road. The tower’s peak electricity demand is estimated at 36MVA, equivalent to roughly 360,000 100W light bulbs all operating at the same time.
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CLOCKWISE FROM LEFT: At the peak cooling times, the tower will require approximately 10,000 tonnes of cooling per hour, which is equivalent to the capacity provided by 10,000 tonnes of melting ice in one day; the tower will have the world’s highest elevators; hot and humid outside air, combined with the cooling requirements of the building, will result in a significant amount of condensation of moisture from the air. This condensed water will be collected and drained in a separate piping system down to a holding tank located in the basement car park, after which it will be pumped into the site irrigation system for use on the tower’s landscape plantings. This system will provide about 15 million gallons of supplemental water per year, equivalent to nearly 20 Olympic-sized swimming pools.
BURJ DUBAI The marvel of the Middle East and the envy of the world, the Burj Dubai, is getting ready for its official opening on January 4, 2010. The day is also the fourth anniversary of HH Sheikh Mohammed bin Rashid Al Maktoum becoming the ruler of Dubai. Information source: www.burjdubai.com
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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TENDERS §
¦TENDERS FREE TENDERS AND SERVICES IN THE CONSTRUCTION INDUSTRY TO INCLUDE YOUR TENDERS IN THIS SECTION EMAIL TENDER DETAILS TO EDITOR@CONSTRUCTIONWEEKONLINE.COM
Tender focus
OMAN MINISTRY OF HEALTH The Ministry of Health is responsible for ensuring the availability of health care to the people of Oman. The government body is currently running its seventh fiveyear plan for health development (ending next year) to improve primary, secondary, tertiary and pharmaceutical health care. It has recently opened a tender for the construction of a health centre in Musanah as part of this plan. The bidding deadline is December 7. The ministry has also issued tenders for the construction of health centres in Saham in Al Batinah region and Al Ajaiz. Closing dates for tenders are December 14 and December 21 respectively.
To include your tenders in this section email tender details to editor@ConstructionWeekOnline.com
BAHRAIN Issuer: Electricity and Water Authority Tender No: 307/2009/6015 Description: The scope of work includes renovation of an administration building at Sitra Power and Water Station. Closes: December 2 Fees: BD15 Contact: www.tenderboard.gov.bh EGYPT Issuer: Egyptian Railways Integrated Services Company Description: Engineering, design, installation and commissioning of four stationary trains washing systems in Cairo. Closes: January 24 Fees: EP5000 Bond: EP200,000 Contact: The Railways Workshops, Al Farz, El Sharabiya, Cairo OMAN Issuer: Ministry of Regional Municipalities and Water Resources Tender No: 297/2009 Description: The scope of work includes the construction of a sewage treatment plant and sewerage network system for Misfat Al Abrean suburb in Wilayat Al Hamra. Closes: November 30 Fees: OR500 Contact: www.tenderboard.gov.om Issuer: Ministry of Foreign Affairs Tender No: 320/2009 Description: Expansion of Ministry of Foreign Affairs at Al Qurm Bausher. Closes: November 30 Fees: OR1000 Contact: www.tenderboard.gov.om Issuer: Ministry of Education Tender No: 298/2009 Description: Construction of Atuffail bin Amr Boys Basic School at Al Owaid. Closes: December 6 Contact: www.tenderboard.gov.om
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THE MINISTRY IS AIMING TO IMPROVE ALL SECTORS OF HEALTH CARE IN OMAN.
Issuer: Ministry of Housing Tender No: 301/2009 Description: Construction of 32 housing units and a mosque in the Al Sharqiya region. Fees: OR500 Closes: December 7 Contact: www.tenderboard.gov.om Issuer: Ministry of Health Tender No: 307/2009 Description: Construction of health centre at Musanah. Closes: December 7 Fees: OR375 Contact: www.tenderboard.gov.om Issuer: Oman Tourism Development Tender No: 308/2009 Description: Provision of consultancy services for the development of Fort Hotel. Closes: December 7 Fees: OR375 Contact: www.tenderboard.gov.om QATAR Issuer Public Works Authority Tender No: PWA/ITC/040/09-10 Description: Construction of sewer manholes. Closes: December 6 Fees: QR1000 Contact: Contract Department, Public Works Authority Issuer: Public Works Authority Tender No: PWA/GTC/045/09-10 Description: Reconstruction of the Najma Road extension. Closes: December 8 Fees: QR7000 Contact: Contract Department, Public Works Authority Issuer: Public Works Authority Tender No: PWA/GTC/042/09-10 Description: Construction of main roads, as well as internal roads for packages one to five. The project is located around 3km north of Doha. Closes: December 8 Fees: QR5000 Contact: Contract Department, Public Works Authority
CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
Issuer: Public Works Authority Tender No: PWA/GTC/049/09-10 Description: Modifications and additions with associated services to exiting 36 schools around Doha. Closes: December 8 Fees: QR2000 Contact: Contract Department, Public Works Authority SAUDI ARABIA Issuer: Royal Commission for Jubail and Yanbu Tender No: PIC G-1679E Description: All work necessary for a complete operational facility of Juma Mosques. Closes: December 5 Contact: Director, Purchasing and Contracting Department, PO Box 30031, Madinat Yanbu Al Sinaiyah Issuer: Saudi Railway Organisation Tender No: 218 Description: Specification for the design of new bridges for the rail line with the assessment of the existing railway bridges and concrete sleepers on the rail line in various locations between Dammam and Riyadh. Closes: December 7 Contact: www.saudirailways.org UAE Issuer: Dubai Electricity and Water Authority Tender No: CE/0423/2009 Description: Supply, installation, testing and commissioning of 132/11KV substations. Closes: December 6 Fees: AED5000 Contact: www.dewa.gov.ae Issuer: Ministry of Public Works Tender No: 2009/167/10-341104-7091-7048 Description: Construction of a maternity and children’s hospital in Sharjah, UAE. Closes: December 22 Fees: AED8000 Contact: www.mopw.gov.ae > For more tenders check online at www.ConstructionWEEKonline.com/tenders
¦PROJECTS
> For the latest projects information visit www.ConstructionWEEKonline.com/projects
§ PROJECTS
A SAUDI ARABIA DATABASE - BUILDING PROJECTS FOCUS TO LIST YOUR PROJECTS IN THIS COLUMN EMAIL DETAILS TO EDITOR@CONSTRUCTIONWEEKONLINE.COM
Project focus
DISTRICT COOLING NETWORK IN JEDDAH The project calls for construction of district cooling networks. The development will be used to supply cooled water and electricity for the 2nd Jeddah Industrial City and will also include the construction of steam networks. In September 2009, Saudi Industrial Property Authority awarded National Tri-generation CHP Company (NTCC) the built, operate and transfer
PROJECT TITLE
contract. NTCC will operate the district cool network for 30 years. The project value is US $300 million (SR1 billion). Construction has started and is expected to be completed by quarter four of 2011. The district cooling networks will reduce the need for new infrastructure facilities for industrial areas and in-turn construction costs.
CLIENT
CONSULTANT
THE CONSTRUCTION CONTRACT WAS AWARDED IN SEPTEMBER.
MAIN CONTRACTOR
VALUE (US$MN)
STATUS
SAUDI ARABIA Saudi Electricity Company
Fichtner
Not Appointed
950
project under design
NEW DAM IN HAIL
Ministry of Water & Electricity
SaudConsult
Progressive Construction
53
project under construction
202KM TRANSMISSION LINE BETWEEN QURAYYAH POWER AND THE NATIONAL GRID
Saudi Electricity Company
Hyundai Engineering & Construction Company
106
project under construction
BADER SUBSATION - YANBU OHTL
Saudi Electricity Company
Al Saleh & Massoud Company
5
project under construction
YANBU INDEPENDENT WATER & POWER PROJECT
Marafiq / Saline Water Conversion Corporation
Not Appointed
4000
project under design
PRINCESS NOURA BIN ABDULRAHMAN UNIVERSITY - HIGH VOLTAGE SUBSTATION
Ministry of Higher Education / Ministry of Finance
ABB Contracting Company / Al Fanar
167
project under construction
110/13.8KV AL BAIDAA SUBSTATION
Saudi Electricity Company
Siemens
10
project under construction
132/33KV SUBSTATION IN NMAS
Saudi Electricity Company
Iscosa Industries & Maintenance
40
project under construction
380KV MANIFA SUBSTATION
Saudi Electricity Company
National Contracting Company
123
project under construction
33KV HV LINE IN ABHA
Saudi Electricity Company
In House
National Contracting Company
10
project under construction
REINFORCEMENT OF SIX 132KV SUBSTATION IN JIZAN
Saudi Electricity Company
In House
Iscosa Industries & Maintenance
65
project under construction
SHUQAIQ - ABHA EAST OHTL
Saudi Electricity Company
Middle East Engineering & Development Company
59
project under construction
QSAI DAM AT JIZAN
Ministry of Water & Electricity
Zuhair Fayez Partners
Bin Jarallah Group
40
project under construction
1200 MW THERMO ELECTRIC POWER PLANT IN RABIGH
Saudi Electricity Company/Acwa Power International/Kepco
Not Appointed
Not Appointed
2000
project in concept stage
NEW DAM IN ABHA
Ministry of Water & Electricity
Zuhair Fayez Partners
Bin Jarallah Group
16
project under construction
33KV HV LINE IN AL HAGU VILLAGES
Saudi Electricity Company
In House
Al Saleh & Massoud Company
10
project under construction
132/380KV SUBSTATION IN NAMERA
Saudi Electricity Company
In House
ABB Contracting Company
162
project under construction
EXPANSION OF 20 DISTRIBUTION SUBSTATIONS
Saudi Electricity Company
ABB Contracting Company
34
project under construction
132/13.8KV 8829-SUBSTATION IN AL MOROOJ AREA
Saudi Electricity Company
Al Osais Contracting Company
50
project under construction
115/380KV HALF MOON SUBSTATION - PHASE 2
Saudi Electricity Company
ABB Contracting Company
66
project under construction
Mohammed Turki Mott MacDonald
In House
In House
To list your projects in this section email details to editor@ConstructionWeekOnline.com
MUZAHIMIYAH POWER PLANT
SPECIALIST SERVICES §
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Supplier focus
RIMAL ENGINEERING PRODUCTS
MANUFACTURER OF BUILDING AND FINISHING MATERIALS
To advertise please call +971 4 435 6375 or email shishir.desai@itp.com
Rimal Engineering Products was panies across the region over the founded in 1989 in Abu Dhabi and past two decades. it has grown to become one of the Through its proud legacy of proUAE’s longest established agents in fessional service, Rimal has some the construction industry. It supplies involvement with most new projects construction, building and finishing under construction in Abu Dhabi, materials from leading international including some of the residential brands to construction companies, and commercial developments, builders, specifiers, and interior from large scale residential and design firms, as well as the oil and commercial tower developments gas, power, and water industries. to high end residential villa comIts product range stretches from pounds, hotels, oil and gas installapre-mixed plaster for internal, tions, refineries, power and water external and decorative uses, to plants and palaces. architectural ironmongery, kitchRimal is the exclusive agent for ens, solid surfaces, masonry blocks, international brands such as Conand more. Rimal also provides fibremix and Arabian Concrete Products, among others. The company glass gratings, handrails, ladders and structures. is currently involved in Abu-Dhabi The company specialises in helpbased projects such as Shams Abu ing suppliers and manufacturers of Dhabi, Al Reef Villas, Al Raha, Golf construction materials and chemi- RIMAL ENGINEERING PRODUCTS HEAD OFFICE. Gardens and Etihad Towers, and cals build their brands and gain a it has worked with some of the foothold in the UAE market, and it has developed strong Emirate’s biggest developers, including Sorouh, Aldar partner relationships with all major construction com- and Manazel.
BUILDING MATERIALS
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CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
BUILDING MATERIALS
HARD LANDSCAPING SUPPLIER
CEILINGS/PARTITIONS
§ SPECIALIST SERVICES
> For directory information visit www.ConstructionWEEKonline.com/directory
Calcium silicate and cement bre boards of thickness 6mm, 9mm and 12mm. Tiles vinyl fabricated and painted. CONSTRUCTION/MANUFACTURERS
CONSTRUCTION CHEMICALS
Full range of plaster, tiles and gypsum tools
DEWATERING
Engineering Works Foundation Infrastructure (L.L.C.) P.O. Box: 111245, Dubai - U.A.E. P.O. Box: 2752, Abu Dhabi - U.A.E. Tel: +971 4 340 9022 Fax: +971 4 340 8952 E-mail: brian@ewfi.ae
SPECIALIZED DEWATERING SERVICES: • Specialized in Deepwell, Wellpoint, Open pumping techniques • Professional Service OTAL (LLC) Dubai, U.A.E Phone: (+971-4) 267 9646 e-mail: otal@eim.ae website: www.otal.ae
• Round the clock backup • Effective Groundwater control NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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To advertise please call +971 4 4 435 6375 or email shishir.desai@itp.com
CONSTRUCTION/MANUFACTURERS
SPECIALIST SERVICES §
¦SPECIALIST SERVICES CONSTRUCTION PRODUCTS AND SERVICES MADE EASY IN CONSTRUCTION WEEK’S DIRECTORY TO ADVERTISE PLEASE CALL +971 4 435 6375, OR EMAIL SHISHIR.DESAI@ITP.COM
CONTRACTORS/MANUFACTURERS
LANDSCAPING
POST TENSIONING
FLOORING
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Alomi
Albert +971 50 854 5629 Simon +971 50 854 5327 Office +971 4 885 8825 www.alomirealwoodflooringllc.com A
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HVAC & PLUMBING RELATED EQUIPMENT
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CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
PP CORRUGATED SHEETS
RECRUITMENT
ยง SPECIALIST SERVICES
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RECRUITMENT
,OOKING TO RECRUIT WORKERS FROM
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OR LOCAL LABOUR SUPPLY 7E ALSO UNDERTAKE -IGRATION 3ERVICE TO !USTRALIA #ANADA 4EL &AX % MAIL ASSIDUAA EIM AE STEEL
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NOVEMBER 28โ DECEMBER 4, 2009 CONSTRUCTION WEEK
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CITY UPDATE YANBU, SAUDI ARABIA
Plans for Yanbu CONNECTING YANBU TO THE REST OF SAUDI ARABIA COULD BE A VERY PROFITABLE EXERCISE By James Boley
B
uoyed by the evergrowing petrochemical industry, Yanbu, one of two economic cities established by Saudi Arabia in 1975, along with
46
Jubail, continues to go from strength to strength. After the flurry of summer openings, including the US $5.3 billion (SR20 billion) Yanbu National Petrochemicals Company, road and bridge projects worth $35 million and other developmental projects worth $533
CONSTRUCTION WEEK NOVEMBER 28–DECEMBER 4, 2009
PETROCHEMICALS REMAIN AN IMPORTANT PART OF THE YANBU ECONOMY.
million, other companies are increasingly looking at expanding into the city. Yanbu was chosen as the site for Jotun Paints’ newest factory in Saudi Arabia, bringing the firm’s total capacity in the kingdom to 110 million litres. The fully automated plant cost US $26.6 million (SAR100 million) and was constructed as a response to growing demand in Saudi Arabia. “The Yanbu development is a reflection of our commitment and support toward Saudi Arabia. Not only does this represent a significant business opportunity and develop-
RAJESH RAGHAV/ITP IMAGES
“THE YANBU DEVELOPMENT IS A REFLECTION OF OUR COMMITMENT AND SUPPORT TOWARD SAUDI ARABIA AND REPRESENTS A SIGNIFICANT BUSINESS OPPORTUNITY” ment of the industry, but it also enables us to contribute to the community by creating career and development opportunities,” says Jotun chairman Odd Gleditsch Dy. Confidence in the future of Yanbu remains very high. “Jubail and Yanbu are very successful stories. When they were started in the 1980s everybody was saying ‘these
DR.ABDULRAHMAN H AL SHAIKH.
JOTUN CHAIRMAN ODD GLEDITSCH DY.
people are crazy, don’t bother doing it’ – everybody was gambling about its failure and now everybody is talking about its success. It proved to be the right decision at the right time,” says Saudi Arabia’s deputy minister for town planning, Dr Abdulrahman Al Shaikh. “I know there are some people who have their doubts about the success of the economic cities, but this is the nature of people. I believe they will prevail, because the Kingdom’s economy and resources are sound and if it is the will of the government to support it, then it will go on.” Proof of this confidence comes from the Saudi Landbridge project. The US$10 billion rail link will connect the country’s Red Sea coast to the Gulf, and Yanbu will be one of the stops on the line. The Landbridge will connect Yanbu to Jeddah, Damman, Riyadh
and Jubail. The project involves the construction of 950km of new railway tracks between Riyadh and Jeddah, and another 115km line between Dammam and Jubail. However, despite this growth, the city still lags behind some of its rivals. Many companies are shipping their products from the Islamic Port of Jeddah instead of using the port of Yanbu, as there is not enough shipping happening there,” says Jamal Malaikah, president and COO of National Petrochemical Industries (Natpet). Meanwhile, the current tenders list for the city indicates strong growth in the healthcare sector, with several health clinics and medical staff accommodation planned for the industrial city. Construction on the $12 million clinics package by Rezayat Trading began in Q1 this year and is expected to be complete by Q1 2011.
TOP PROJECTS
US$
Waterfront Development at Yanbu - Dredging Package Expansion of Plaster Plant Public housing Doctors’ housing Yanbu industrial College (YIC) and Yanbu Technical Institute (YTI) dormitories
100m 100m 80m and 75m 50m 45m
NOVEMBER 28–DECEMBER 4, 2009 CONSTRUCTION WEEK
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DIALOGUE ANDREW DOEL Lightweight Champion Lytag managing director Andrew Doel discusses the advantages of lightweight concrete and how his company is progressing in the Middle East
By Sarah Blackman
What products and services do you offer?
We manufacture and supply a lightweight aggregate, which is used primarily within lightweight concrete. One of the major disadvantages of concrete is its deadweight (density). If you use Lytag in your concrete you can reduce your deadweight down to about 1400kg and 1800kg per m³. The density of normal concrete made with plain cement is about 2400kg per m³. The product itself is manufactured from pulvarised fly ash, which is generated from electricity production in coal-fired power stations. The density of Lytag is around 850kg per m³ and dry density is about 750kg per m³. The low density of the conrete also improves its insulating properties. Thermal conductivity can be reduced by over 25% by using light weight aggregate as opposed to natural aggregate. We set up business in the early 1960s and I think it was a product that was a little bit before its time during that period.
which then makes the concrete. Lytag is usually specified by the engineer or architect in order to take advantage of the end product. When and why did Lytag come to the Middle East?
Lytag is not set up here in the Middle East, we have partnered with Bulk Materials International in September last year. We certainly plan to continue working with them but one never knows what the future holds. At the moment, our material is manufactured in Europe but we are looking to start manufacturing the product in India, which would open up the volume of product that we have available. There are one or two projects that we have planned for the future, for example we have been talking with clients in Dubai and Doha. How sustainable is light weight aggregate?
It is environmentally friendly in a number of ways. Over the years that Lytag has been operating we have used around 16 million tonnes to 17 million tonnes of fly ash. If No. Lytag concrete will have the same structural integrity we didn’t use it, it would generally go to a landfill. Natural as normal concrete – you produce the same strengths. aggregates are around twice the density of Lytag. For Sixty Newton is perfectly achievable with Lytag. It can every tonne of Lytag you use, you prevent the extraction certainly be used in high-rise towers, where light weight is of two tonnes of natural aggregate, which you can’t ever an important factor, and any other structure for that matter. replace. Also, a lot of steel that goes into concrete is there The reduction in dead weight means that considerable to support the dead weight, therefore you can reduce the savings can be made in foundation and reinforcement costs. quantity of steel that goes into a structure when using a There are also no issues with pumping the concrete. light weight aggregate. One project in the UK recorded a 13% reduction in the quantity of steel Which Middle East projects have you they used. Two recommendations put supplied your product to? Doel has worked in the construction forward by the World Commission industry for more than 20 years, We are relatively new in the Middle on the Environment are to conserve specialising in the cement, concrete and East, however, we have supplied a and enchance the resource base and aggregate markets. After joining the number of projects with Lytag. The two combine environment and economic company in 2000, he has fulfilled the role that spring to mind are Terminal 3 at considerations in decision making, Dubai Airport and the new aluminium of managing director of Lytag since 2008. which is what we do at Lytag. The Overseeing the growth of the Lytag brand smelter in Abu Dhabi. These are the aggregate also improves fire resistance, worldwide, Doel divides much of his time larger projects that we have worked partly due to particle stability at between the UK and the Middle East. on in the Middle East. We supply the elevated temperatures, as well as product to the ready mix producer, chemical and frost resistance. Does the density of Lytag affect the performance of the concrete produced?
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CONSTRUCTION WEEK NOVEMER 28–DECEMBER 4, 2009
Alumil Gulf fzc subsidiary of ALUMIL in the Middle East
Technology Park, RAK FTZ, RAK tel +971 7 2444106, fax +971 7 2444107 email support.uae@alumil.com