By Jason Benham www.arabianbusiness.com
Dubai could spend about $3bn in transport infrastructure projects in 2010 as it looks to stimulate the economy and has no issue paying its contractors, the chairman of the transport department said.
The government has positioned its infrastructure development as central to its position as the Middle East’s commercial and tourism hub and continued to invest in it even as the economic crisis battered Dubai’s real estate market and sent tens of thousands of workers home.
“Investing in infrastructure is the driving force for the economy,” Mattar al Tayyer, chairman of Dubai’s Roads & Transport Authority told a news conference on Wednesday.
“We have AED10.5bn budget for this year and we will spend more in the future,” he said, later adding that could rise to AED10.7bn.
Dubai sent shockwaves through global markets in November when it said it would request a standstill on billions of dollars of debts linked to the state-held holding firm Dubai World and its property units Limitless and Nakheel, developer of three palm-shaped islands.
Costs on the Dubai metro rail project, which started operating in September, soared 80 percent to AED28bn, officials said in August.
Construction on the metro has been slowed as the Japanese leader of the consortium discusses cost increases due to design changes, a spokesman for general contractor Obayashi Corp said on January 7.
When asked whether Dubai could meet obligations to contractors and consultants on the project, Tayyer said “there is no issue.”
The other Japanese consortium members are general contractor Kajima Corp, Turkey’s Yapi Merkezi Insaat Ve Sanati AS, Japan’s Mitsubishi Heavy Industries Ltd and trading house Mitsubishi Corp.
The full completion of the rail system was originally scheduled for this spring but is expected to be delayed until the end of the year. (Reuters)