The chairman of London’s Olympics Delivery Authority says that cities in the Middle East preparing to host major global events will have to focus on time rather than cost when delivering new infrastructure.

“Time is the overriding parameter,” says Sir John Armitt. “Cost will have to come second.”

Doha and Dubai are preparing to host major global events over the coming decade. Dubai is preparing to host the World Expo in 2020 and Qatar is the venue for football’s Fifa World Cup in 2022, both of which are expected to require billions of dollars of new infrastructure.

Both markets have a reputation for being cost driven, and in recent years have become increasingly competitive for contractors as they scramble to secure work on new major infrastructure projects.

Doha is expected to spend $70bn on related infrastructure projects ahead of the World Cup tournament. The largest component of the spending will be the $30bn Doha Metro scheme. Dubai is expected to spend at least $7bn ahead of 2020 on projects directly related to the Expo.

One of the main concerns for contractors working in Qatar and Dubai is competition, as companies risk winning work with low margins, a problem often compounded by unfavourable payment terms where contractors are not paid for 60 to 90 days.

Armitt says competition is a function of the economic climate, and while there has been downward pressure on prices in recent years, as the market picks up it should ease. “Behaviour is driven by the economic situation, the moment the situation becomes tight it is very difficult for the client to not push and push and get the lowest price,” he says.

There was limited interest from contractors in the contract to build the Olympic Stadium of the 2012 London Olympics in 2006, yet there was ample interest in contracts that were tendered from 2008 onwards once the market had turned due to the global financial crisis. “The stadium was a high-profile job with risk. In the end, only [UK construction firm Sir Robert] McAlpine wanted it because it had built Wembley [Stadium] and just finished Emirates [Stadium]. For us as a client, it is difficult when there is not much competition, which is why we went for a profit-sharing agreement,” says Armitt. “In 2008-09, we started the Athletes’ Village. By then, the market had changed and we had six or seven bidding each block.”

The profit-sharing agreement produced a less adversarial outcome. “Interestingly, we closed the final account for the stadium within three months. We still have a lot of claims on the village,” says Armitt.

For payments, contractors working on projects for the 2012 London Olympics were paid 18 days after completing their work to ensure the project was delivered on time. “It was purely out of self-interest. We started construction in 2008 and contractors were starting to feel the pinch with cash flow. For us, one of the big risks was companies starting to go out of business,” says Armitt. “We had 18-day certification [of payment] and all we’re doing was managing that risk. We then had to make sure our contractors passed that [payments] on to the supply chain.

Armitt is visiting the UAE and Qatar promoting civil engineering for the Institution of Civil Engineers.