Market Monitor - Construction industry - UAE

Market Monitor

  • United Arab Emirates
  • Construction

19th February 2015

Problems remain in the building sectors of most of the countries covered in this issue of the Market Monitor. Consequently, the outlook for the construction industry in 2015 remains muted.

Market performance at a glance

United Arab Emirates

  • The sharp decrease in oil prices having a negative impact on the economy, and is also affecting real estate and construction.
  • Payments in the construction sector take between 90-120 days on average. However, payment is often delayed up to 180 days or even longer, especially when government departments are involved.
  • Due to the current challenging economic environment (probable overcapacity, reduced oil prices, less government spending) we are now more cautious in underwriting construction businesses.
  • Payment behaviour is expected to deteriorate and insolvencies to increase in the coming months.
  • Prudent cash flow management and continuation of bank facilities will be key to sustaining business in 2015

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