BUSINESS INDUSTRY UK builders chase $331 mln unpaid Dubai bills
DUBAI - British construction companies are chasing GBP200M ($331.58 million) worth of unpaid bills in the United Arab Emirates, mostly in Dubai, where the real estate industry is reeling from the global economic downturn, an office at a UK business group said.
"There's still quite a lot outstanding and possibly well in excess of 50% outstanding," Nelson Ogunshakin, chief executive of UK trade body the Association for Consultancy and Engineering, or ACE, which represents about 800 construction firms, told Zawya Dow Jones in a telephone interview Monday.
In May ACE said British construction companies were owed GBP400 million by UAE-based real estate developers, mostly in Dubai. While progress has been made in recouping some of the money owed to contractors, settlements are still "not coming in fast enough" and the situation remains a concern, said Ogunshakin.
"One thing is the promise you will get it and the other is getting it," he said, referring to nonpayment.
Dubai's once booming property sector was hammered by the international financial crisis. Developers delayed payments to contractors, credit dried up, investors fled and house prices are nearly 50% lower than they were a year ago, real estate consultancy Colliers International said earlier in the month.
Some 566 projects have either been shelved or postponed in the UAE, mostly in Dubai, Dubai-based market research firm Proleads said in September.
Dubai sold $10 billion worth of bonds to the Abu Dhabi-based Central Bank of the UAE earlier in the year to help meet its $80 billion of debt but this has failed to solve the problem of unpaid foreign contractors.
