Construction Procurement


Adil Abdalla
2014, updated 2018

How to Procure Construction Works in UAE Following the Global Recession

Research Territories

  1. The mix between UAE & Dubai is not recommended, as each has its own business history, governance mindset and corporate culture.
  2. Instead; it is more resourceful and manageable to address Dubai, whereas 2000:2010 had witnessed unprecedented examples of dared-enterprising, adventurous visions and cosmopolitan expertise.
  3. 2000:2010 is advised; as 2000 had recorded the launch of DMTFZ or TECOM, as the 1st in-land business free zone, while 2010 was the lowest decline indicator Dubai had witnessed; which was followed with structural reforms and tools.


Global Recession or Bubble Syndrome

  1. Despite the whole world had suffered sharp decline in shares and markets during 2007:2009, which stills ruling the financial markets with accumulative losses exceeded $280 Trillion; the notion is doubtful to explain the happenings at Dubai Market.
  2. Despite how greed and anxiety are associated with the Bubble syndromes in both Financial Assets and Real Estate businesses; the complimenting features are different; such as feeders, logistics, legislations and retails dynamics.
  3. No doubt about the role of immaturity in Dubai’s Real Estate and Construction sectors; which had raised the contribution to the GDP from the global average of 17-22% to the Dubai stat of 38%. This had elevated the Risk Exposure with inadequate or no tools to mange at all.


Morphology of Dubai Economy

  1. Since mid 1990th, Dubai had reduced the share of Oil wealth in its GDP to only 6-9%; which not only had reflected the actual production levels, but also the resilient business characteristics of the tiny Emirate. That challenge had set the mandate for Government Officials to enable innovations, renewability and modernization to mark both economy and bureaucracy.
  2. Introducing the foundations of Knowledge-Based economy was extremely brilliant and new fashion; which had hit hard rivals across the Middle East and South West Asia. The associated funds to develop and provide adequate economic and physical infrastructure was the gate for exposure on modern fiscal management.
  3. Interestingly enough that seeds for excellence ere the same for depression. The much decision makers were enthusiastic about launch new endeavors, the much they had exceeded the reasonable thresholds for investment and supply offering.


EPC Procurement Approach

  1. The immediate negative effect of the 2010 downturn was the exodus of tens of thousands professionals to neighboring GCC countries or Far East and Oceania. Apparently, the Managers of Dubai Boom did not fully understand and manage the principles of global expat dynamics and placement. Therefore, they underestimated the synchronization of personal security and corporate loyalty as critical derivatives.
  2. The impact of intellectuality reduction and expertise migration was a killer to the real estate business in general and the construction industry in particular. The cycle of data mining, analysis, optimization and approval was seriously fractured by inexperienced replacements and inadequate competences. The series of prosecutions and indictments that tracked inappropriate processing and misconduct, had shacked the confidence of most senior executives, and reduced their appetite for challenges and calculated risks as well. Everyone plays extremely safe; regardless of consequences.
  3. EPC fashion was not introduced as evolution of procurement, but as mitigation of risks due to non-clarity of scope or non-constructability of engagements. Executives and staff were broadly incapable to process the business in the same professional and innovative manners, as done few years earlier. In addition, ruling municipal bylaws, contractual liabilities and arbitration mechanism are notoriously apart from the advocacy of this fashion.


Questionnaire Structure

  1. The questionnaire should knit a matrix of information and indications; which shall meet the triggering perception that are driving the entire thesis. This should equally target both Governors and Businesses.
  2. In both, the Questionnaire shall ideally have various sets of data mining leads for the various decision making levels, across the process cycle. Benchmarking shall offer the guidance towards useful information and indicators.
  3. Should the questionnaire include virtual cases and incidents to seek the swift and spontaneous responses; which would capture the mindset and professional parameters.


The great asset bubble during the Late-2000s recession

1 – Central banks gold reserves ($0.845 trillion)

2 – M0 (paper money) ($3.9 trillion)

3 – Traditional (fractional reserve) banking assets ($39 trillion)

4 – Shadow banking assets ($62 trillion)

5 – Other assets ($290 trillion)

6 – Bail-out money (early 2009) ($1.9 trillion)