Leaders UAE 2018 Preview: Carillion collapse shows dangers of late payments
Carillion's collapse is a reminder that despite an extensive order book, contractors may fail if recovery is not prioritised, BCLP's Richard Dupay says
Richard Dupay, associate for international arbitration and construction at Bryan Cave Leighton Paisner (BCLP), talks about the lessons to be learnt from Carillion’s collapse, and the market crash of 2008/09. To learn more about the Construction Week: Leaders in Construction UAE Summit 2018 and how you can attend the exclusive conference in Dubai, click here.
What are the main challenges facing the construction industry in 2018?
The collapse of Carillion has served as a helpful reminder that, even with an extensive order book, even the largest players can fall if the recovery of money is not prioritised. Liquidity, and the lack of it, is one of the main challenges facing the Middle East construction industry at the moment. Some of the main employers in the region have large amounts of capital tied up in escrow accounts and are unable to pay their contractors, which means that the latter are once again having to fund projects. This means that only the largest contractors can compete and, as Carillion’s case warns, could fail if they are never paid.
What excites you most about the UAE construction industry in 2018?
The market is becoming more sophisticated. Hard lessons from the 2008/09 crash have resulted in contractors and employers taking time to weigh up risks more thoroughly.
What topics do you expect will be discussed at the CW: Leaders in Construction Summit UAE 2018?
Some issues that I think will be discussed include the liquidity of employers and contractors; Expo 2020 Dubai; FIDIC’s 2017 iteration, and whether it will be used efficiently; and global warming, and its impact on how we build.
Why is it important for BCLP, and for you, to support and attend the CW: Leaders in Construction Summit UAE 2018?
The CW: Leaders in Construction Summit has established itself as one of the key events in the regional construction professional’s calendar, attracting top leaders in the industry. It is important to stay up-to-date with the latest trends in the market, and to share successes, challenges, and aspirations with like-minded professionals.
What are the latest developments that your company has unveiled this year?
In April 2018, legacy firms Bryan Cave and Berwin Leighton Paisner merged to form BCLP. The combined firm now gives us a truly global reach that will enable us to serve clients in an ever-shrinking world.