37 Construction in Saudi Arabia.
Summary:
37.1 Introduction.
37.2 Project Control Systems.
37.3 Productivity and Efficiency.
37.4 Example Infrastructure Development.
37.5 Construction Problems in Saudi Arabia.
37.6 Conclusions.
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37.1 Introduction.
• In recent years, construction in Saudi Arabia has
been prosperous.
• Construction has been undertaken by construction
firms from all over the world:
– consequently, management of construction projects
has not been standardized:
– four different types of project management practices
are found in Saudi Arabia:
• traditional A/E - usually government funded, lump-sum;
• design-build - generally military projects, negotiated;
• design construction manager - generally large scale projects
like airports;
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• professional CM.
• North American and Western European
contractors dominated the market in the 1970’s;
• Since then, S.E. Asian contractors started making
a significant contribution;
• The number of foreign contractors operating in
Saudi Arabia has been increasing.
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37.2 Project Control Systems.
• From the simplest manual system to the most
sophisticated computer-based methods are used:
– bar charts (Gantt charts);
– CPM (Critical Path Method);
– PERT (Program Evaluation and Review Technique);
• The type of system used is rarely specified by the
contract:
• however, this is slowly changing.
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37.3 Productivity and Efficiency
• Productivity of contractors operating in Saudi
Arabia has improved tremendously over the years.
• A series of development plans for the country have
been implemented:
– first (1970-75) = 49.6% of total government
expenditure;
– second (1975-80) = 32% of total spending;
– third (1980-85): projects worth over a $130 billion were
executed in the country;
– fourth (1985-90): successful, but labor force decreased
due to computerization, automation, and mechanization.
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37.4 Example Infrastructure
Development
• Universities in Saudi Arabia (8 new) have made a major
contribution to the evolution of construction in the country;
• Example: King Saudi University, 1984:
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cost $4,400,000,000;
nine different colleges;
870 bed teaching hospital;
2,000,000 volume library;
dormitories for 15,000 students;
3,000 housing units …..
• Other significant projects:
– construction of three international airports: Jeddah; Riyadh; and
Dharan.
– Road networks;
– Port facilities;
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– Agriculture and industrialization.
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• To facilitate foreign investments, a new law ( 2000):
– foreign investors the same benefits, incentives and guarantees
offered to Saudi Arabian individuals and companies;
– foreign investors the right to own property;
– allows investors to remit funds abroad, protects their property
from confiscation; and;
– reduces by 15 percent the amount of taxes imposed on foreign
companies that have an annual profit of more than 100,000 riyals
(about 26,700 dollars).
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37.5 Construction Problems in
Saudi Arabia
• The great development of Saudi Arabia has created
a series of problems:
– Economic problems:
• rate of inflation high in the first two years of the second plan:
– manipulation and overpricing by foreign contractors;
– inability of construction market to meet available cash for construction
(money supply > available products = inflation).
• Inflation in 1976 at 38%, caused by:
– congestion in main harbors;
– shortage of construction materials.
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– Social problems:
• hundreds of thousands of laborers have been imported from
different cultural backgrounds to a conservative society:
– the foreigners could not easily socialize, and became despondent;
– there is concern within Saudi that local people will pick-up bad habits from
the presence of 6,000,000 foreigners, and the frequent travelling of Saudis.
– Technical problems:
• newly constructed structures have been subject to several problems,
most of which are geotechnical in nature:
– limestone solution cavities;
– high water table; and
– swelling of clay fills;
• the harsh desert climate conditions cause other technical problems;
• consultants and contractors from different backgrounds are familiar
with different codes of practice and standard specifications.
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– Legal and management problems:
• most projects are based on accelerated schedules;
• many foreign contractors try to use imported control systems
in a way that ignores local conditions (eg: no consideration of
productivity variation during fasting month);
• consequntly, this leads to delays, and thus legal and
administrative problems.
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37.6 Conclusions
• Construction evolution is taking place in Saudi:
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25% of the total civilian labor force is in construction;
14% of energy consumption is in construction;
19.8% of non-oil GDP is construction;
during the 1980’s and 1990’s, for example,
approximately $500 billion was spent on construction.
• Basic infrastructure has been completed, and in
recent years most work has been in the industrial
sector;
• As the basic infrastructure and other facilities have
been completed, the demand for maintenance and
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operation facilities has increased;
• Architects and Engineers need to be more sensitive
to the needs of the Saudi environment, and culture,
rather than repeating what they would produce in
their own countries:
– for example, facilities should be designed so that
operations and maintenance costs are kept to a
minimum (most labor is imported).
• data collection, analysis, and documentation should
be more rigorous to allow for more lessons learned
and thus better future performance;
• there should be more effort to establish partnerships
with Saudi firms.
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38 Survey of Planning and Control
Techniques Used in Saudi Arabia.
Summary:
38.1 Introduction.
38.2 Results.
38.3 Summary of Results.
38.4 Conclusions.
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38.1 Introduction.
• Contractors operating in Saudi have had to become
more efficient due to increased competition.
• An important mechanism by which this is being
achieved is through project planning, scheduling,
and control (PSC).
• The objectives of the study reported here was to
explore:
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the familiarity, usage and benefits of PSC in Saudi;
the major areas of application of PSC in Saudi;
the extent of success of PSC in Saudi;
the factors leading to successful implementation of PSC;
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the factors leading to failure in implementing PSC.
• 61 contractors out of 200 responded to the
questionnaire (30.5%).
• In the study, contractor size given as (SR = Saudi
Riyal):
– volume < SR 25 million = small;
– volume < SR 55 million = medium;
– volume >= SR 55 million = large;
• There were 6 small, 22 medium, and 33 large
contractors in the study.
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38.2 Results
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