Concern over non-payment in the Middle East grows, as project manager downs tools on megacity job
Bovis Lend Lease is suing the developer of a £12.3bn project in Oman for up to £920,000, alleging it was not paid for work.
Bovis was hired to provide project management and other services on the 5,841-home first phase of Blue City, a Foster + Partners-designed megaproject near the capital Muscat, between 2005 and 2008.
The contractor has filed a writ against the developer, which is also called Blue City, claiming it did not receive several payments.
Bovis says in its writ that Fari Akhlaghi, chief executive of Blue City at the time, informed the contractor that it “should have no worries or doubts” about receiving payment.
Bovis says it gave the developer, which is backed by the government of Oman, several opportunities to pay, and it is now claiming damages and interest in addition to the fees owed, totalling up to $1.5m (£920,000).
Bovis is the latest in a long line of British firms experiencing payment problems in the Middle East.
Last month the Association for Consultancy and Engineering called for government help to secure an estimated £400m in unpaid fees from middle Eastern projects. Consultants WSP, Mouchel and Atkins are all owed money by Middle Eastern clients.
Dominic James, director of British Expertise, which represents British consultants overseas, said it was a “growing phenomenon”.
“British firms are owed a lot of money in the Gulf,” he said. “There have always been payment issues in the region, but people were prepared to accept delays in the past because they knew the money was coming. Now it’s a problem because in many cases, it’s not.”
A spokesperson for Bovis Lend Lease’s Middle East office said the firm had now stopped work on the development, but would not confirm if this was owing to non-payment.