Accepting debt

In early 2009 I visited a Dubai-based contractor and during the meeting I was concerned that the company’s general manager was about to have a heart attack as he told me how much money his company was owed by local developers.

Two years later the panic is over and the mood has changed entirely. Today construction companies are much more relaxed. “Yes we are owed money,” says a consultant. “We’ll get it eventually, we are here for the long term. We just have to wait.”

Contracting companies, which are generally owed far greater sums than consultants are also more relaxed. “We are negotiating. There are lots of options, so clients are offering us land, others are offering to pay in installments, and of course there is the Nakheel sukuk,” says a contractor. “I have no doubt we will get paid somehow.”

The consultant says that companies have just got used to the debts. “I think we are all used to it now. We know we won’t be paid today, but will eventually, so we all just have to accept it. What else are you going to do?”