There will be a 20% growth in the MEP sector in the UAE, said Fabio Sbacches, MEP manager and project manager at LC & Partners Engineering Consultants.
Sbacches was giving his presentation at The Big 5, which featured a dedicated MEP Talks session. His topic was on the MEP market in UAE, with trends and forecast for 2018.
In an interview over the sidelines with MEP Middle East, when asked about the implications of VAT on the MEP sector, Sbacches said: “VAT is still a foggy area. Without the VAT, everything is positive. With VAT, things are unknown. As VAT is new for the country.
"But actually it won’t affect anything; only the client will be affected. Because all the companies will take the 5% and pass it on to the subcontractor. In Europe and US, VAT has been there and it is not causing any problems to companies."
Sbacches spoke about cash flow issue in the MEP market. He said that mismanagement of cash was causing all cash flow problems in the market.
He said: "I have seen so many projects that are stuck. Not a single project was stuck because of technical issues but always for cash flow, because the cash was mismanaged. So people have started to engage professionals in project control by making a proper schedule.
He advised MEP players to engage project management professionals in their work flow. He said: "The project management fee in a project is around 3% of the project value. But it will help in big savings."
Sbacches also pointed out the frequent change in standards in the MEP industry, which is a big challenge.
He said: "If you see for example, civil defense standard five years ago was different and now it’s tough. Very demanding. They have to make it tough because you are talking about fire and safety.
"The only problem is it keeps changing. And sometimes what happens is that when there is a problem and the project is on hold for a year or two and during the completion [of the project] you have top go back to retrofit your work because the regulations have changed."