Businessman and former president of the Council of Saudi Chambers Saleh Al-Turki recently claimed the government is largely responsible for the country's stalled development projects.

According to Al-Turki, the government does not allow stalled companies to apply for new tenders, while it delays the adoption of FADEC, a system which was approved 15 years ago to stipulate rights and penalties for both parties in a contract.

During a panel held at King Abdulaziz University titled “The Importance of the Private Sector in Economic Development,” Al-Turki said businessmen also face five main challenges when developing projects. These challenges are related to quality, stalled projects, seeking new projects that are profitable without development, and Saudization efforts and low salaries.

The businessman told the audience that these accusations have accumulated over the years, after the first development boom. During this period of growth, large budgets for development projects were met with a shortage of labor, prompting the state to open its doors wide for recruitment.

After this construction inflation, unskilled and undocumented workers began engaging in a hidden economy and many of them worked illegally, establishing factories and shops that sell products at lower prices, ultimately making the Jeddah’s underground economy, the largest in the world.

Al-Turki also praised the Nitaqat system, which he said has contributed to creation of many quality jobs for Saudis, improved the status of many private sector companies, and challenged the assumption that private sector companies do not provide big salaries to citizens.

He said 50 percent of firms in the sector are in the green and platinum zones due to their high levels of employment for Saudis. “It is not acceptable to allow companies that do not employ or provide good salaries to Saudis continue with their policies, as all countries promote the employment of their citizens in the private sector. Companies who ignore this responsibility would be pushed out from the market thanks to sound regulations,” the businessman said.

“Unfortunately, the companies that are less compliant with Saudization are the larger companies that have won government tenders, and if these companies do not increase their efforts, they will continue to undermine their own interests,” Al-Turki stated.