Arabian Business reported that the UAE construction sector is being stifled by a lack of lending to small businesses.

Mr Mohammed Nimer CEO of MAG Group Property Development said that small to medium sized businesses were a driving force behind the country’s office and residential property market but are being restricted by a lack of liquidity.

He said that “If banks eased their lending policies, granting lengthier terms and better interest rates the results would help drive demand in the property sector. He said that “More needs to be done to unlock the potential of the SME sector, banks must relax their lending criteria, SMEs are the backbone of many developed economies and they hold the key to real economic growth in the UAE.”

He added that “Imagine the stimulus to the housing market alone if each SME averaged just one new employee per annum, not to mention the benefits to the wider economy airlines, hotels, restaurants, shopping and so on.”

Mr Nimer agreed that confidence needed to be restored in the country’s building sector, but maintained that liquidity was at the root of the problem and would continue to play a critical role.

He said that “The Dubai real estate market in particular has witnessed the more unsavory side of property development. Financial irregularities, land ownership disputes, cancelled and delayed projects and poor quality finishes.

He added that “Owners and staff of new small businesses with aspirations as owner occupiers will still need mortgages

(Sourced from Arabianbusiness.com)