Dispute values in the Middle East Region rose to nearly 7% , their highest value since 2011, according to a report by Arcadis, a design and consultancy firm, reported Trade Arabia.
The disputes in the Middle East cost AED 301.2 million ($82 million), coming ahead of Asia, where the average disputes cost around $67 million, while in UK, Europe, and North America, the average cost of dispute $25 million, according to The National.
“In an economic environment impacted by the oil price, the market continued to see a restriction in decision-making within the industry,” Craig Beeson, Head of Contract Solutions at Arcadis Middle East.
“This drove a lack of appropriate delegation to project management consultants and client representatives, thereby prolonging critical commercial decisions and generating cash flow issues related to instructed variations,” stated Beeson.
The 3 top causes cited included: Failure to properly administer the contract, poorly drafted or incomplete and unsubstantiated claims, and incomplete design information or employer requirements (for design and build).
This is the sixth annual study performed by Arcadis into the duration, value, common causes, and methods of resolution of construction disputes across the globe.