Late payment to contractors stalling KSA projects

Updated 17 August 2013
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Late payment to contractors stalling KSA projects

Late payment to contractors from different government agencies in Saudi Arabia amount to more than SR100 billion, representing about 30 percent of the total volume of government projects in the Kingdom, according to Nabil Abbas, representative of the International Federation of Consulting Engineers (FIDIC) in Saudi Arabia and the Arabian Gulf.
Abbas said the delay in payments to contractors is one of the main reasons for the faltering of government projects in the Kingdom. These delays account for about 20 percent of the total stalled projects.
The system in Saudi Arabia requires contractors to implement projects as long as the contract has been signed, even if the payments are delayed. These delayed payments from government agencies, Abbas said, are not a justification for the contractor to stop, although international law obliges authorities to pay contractors within 30 days of maturity. However, in Saudi Arabia, delayed payments to contractors extend for periods ranging from three to six months, and up to a year in many cases.
Contractors, consultants and owners are all responsible for the delays and the failure of the implementation of projects, but the issuance of approvals for the implementation of government projects is the prime cause, he said.
Abbas also said: “The most important is the control of government agencies, which provide instructions, follow-up, and monitor compliance by issuing approvals in a period not exceeding 10 days, as well as postponing services which obstruct the implementation of government projects.”
Abdullah Radwan, chairman of the Contractors Committee at the Jeddah Chamber of Commerce and Industry, said that many of the causes of stalled projects are beyond the control of contractors. FIDIC’s contract will solve all the problems faced by the contractors, as well as 80 percent of the problems of stalled projects, noting that these contracts will contribute in speeding the completion and implementation of the projects.
He also emphasized that the delayed payments of contractors with government agencies exceeding SR100 billion is a result of bureaucracy. The launch of a contractors association, he said, is one of the most important solutions to creating an official umbrella for contractors, and to finding solutions to the many obstacles in the construction sector.


Iranian regime continues to feed sectarianism: Saudi deputy defense minister

Updated 24 April 2019
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Iranian regime continues to feed sectarianism: Saudi deputy defense minister

  • “We have to choose between the chaos that Iran spreads and stability, security and development,” he said
  • A delegation led by Prince Khalid bin Salman bin Abdulaziz, the Saudi deputy minister of defense, has arrived in Russia for an official visit on Tuesday

DUBAI: Saudi Arabia’s Deputy Defense Minister Khalid bin Salman said the Iranian regime continues to feed sectarianism and disrespect international laws at the eighth Moscow Conference on International Security on Wednesday.

“We have to choose between the chaos that Iran spreads and stability, security and development,” he said adding that “Iran is spreading chaos in the region through destruction and bloodshed, and by supporting the militias of Hezbollah and Houthis.”

“Houthi militias continue to violate the resolutions of the Security Council and the Stockholm Agreement, ignored UN resolution 2216 and the Gulf initiative…our goal is to achieve stability for Yemeni citizens under a legitimate government,” he said.

The deputy defense minister also said that the Kingdom is witnessing today an unprecedented transformation and development to achieve the vision 2030.

A delegation led by Prince Khalid bin Salman bin Abdulaziz, the Saudi deputy minister of defense, has arrived in Russia for an official visit on Tuesday, during which the members will take part in the eighth Moscow Conference on International Security and hold a number of meetings.

Prince Khalid was welcomed by Saudi Ambassador to Russia Dr. Raed Qurmali, military adviser Maj. Gen. Talal Al-Otaibi and Military Attache Gen. Mohammad Al-Mutairi, along with the deputy chief of staff of the Russian defense ministry and other civilian and military officials.