Any market contraction is less likely to result in a wave of contractors, consultants and sub-contractors not receiving payment for work completed.

It remains a concern, says Yu Tao, president and CEO of China State Construction Middle East, but he thinks clients have learned lessons from the 2008-9 period and that governments have put in place better regulation.

“As a contractor we have to be responsible to deliver, and without cash flow it’s impossible.  As a main contractor, we carry a lot of liability on behalf of the client. For sub-[contractors] and suppliers we are their paymaster.”

“So we can end up caught in-between where we didn’t receive payment but we have to honour our commitment to subcontractors and suppliers. We don’t want the same situation [as 2009]. It’s not constructive, it’s not healthy and it’s a waste of time.”

Tao said that if the oil price continues to be depressed, it will impact project work at a later date, particularly once governments begin to tighten their budgets.

He said the company’s previous attempts in the region to do development under a public private partnerships (PPP) model had been unsuccessful.

“It’s always a challenge. Whenever we talk about PPP we are talking about mega-sized projects. For a small project nobody is asking for PPP. To strike a balance between the interest of the developer, government and… the contractor requires wisdom. [They need to] understand each other’s interest and to balance it, to make it mutually beneficial.”