Fahd Muhammad Al-Hammadi, member of the chamber’s board of directors and president of the National Committee for Contractors at the chamber, also called for launching a fund to finance contractors, similar to how specialist construction banks help companies in the sector in a number of countries in Asia and Europe.

Speaking to Al-Eqtisadiah business daily, Al-Hammadi sought the ministry’s urgent intervention to address potential challenges facing the sector.

“Some contracting companies are forced to exit the field and wind up due to their inability to confront the challenges. These challenges include lack of financing, shortage of workers, apathy of Saudi professionals to work in the sector and the nonavailability of any agency to address their problems,” he said.

According to Al-Hammadi, there are serious handicaps for the smooth functioning of this vital sector. He voiced deep concern over the growing trend among some contracting companies to leave the field due to their inability to face the harsh demands of the sector. There are about 140,000 contracting companies in the Kingdom, of which about 3,000 are listed with the ministry.

Al-Hammadi urged the authorities to draft the organizational and legislative framework for the contracting sector in a way serving its interests.

“The authorities are carrying out studies about setting up an independent commission for contractors. The commission should be established at the earliest possible opportunity so that it can swing into action to solve the basic problems of contractors as well as adopt a raft of measures to improve their efficiency and performance,” he said, adding that this would enable the sector to confront the challenges faced by them to a greater extent. “By this, they would be able to compete better for major projects as well as export their expertise outside the Kingdom,” he said.

Al-Hammadi said the new commission could discharge a number of responsibilities that would help boost the contracting sector. These include organizing the sector, classifying the companies in terms of their professional, technological and administrative capabilities in implementing projects, granting licenses, preventing malpractice, and taking punitive measures against contractors violating regulations and engaged in coverup businesses (run mainly by foreigners who then pay a monthly fee to the registered Saudi “owners”).

Responding to allegations from the banking sector that some contractors are implementing some mega projects by relying on bank financing alone, Al-Hammadi said: “Some commercial banks have genuine apprehensions over the capabilities of some companies to make prompt repayment of loans.” He also noted that loans granted by some commercial banks to contracting companies are not at all “sufficient and satisfactory.”