Dubai-based Arabtec cuts 3,300 jobs as coronavirus strains market, says report

Dubai’s Arabtec Holding has laid off 3,000 manual workers in the last two months and 300 staff, sources close the matter said, as the region’s largest listed contractor buckles under the strain of the coronavirus outbreak.

The cuts of around 300 staff, including engineers and project managers, as well as the 3,000 contracted laborers, amount to roughly 20 percent from each category, the sources said, declining to be named as the matter is not public.

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The company, which helped to build the Louvre Abu Dhabi, has also cut the pay of its existing staff between 10 percent to 40 percent, they said.

Arabtec did not respond to requests for comment when contacted by Reuters on Thursday.

The Gulf construction sector has slumped since a collapse in oil prices four years ago forced governments to cut spending, leading to a debt crunch at some companies that operate across the Middle East.

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The coronavirus pandemic and the delay of Dubai’s Expo 2020 world fair by a year to next October has worsened the industry’s problems.

The economy of the United Arab Emirates, of which Dubai is the financial hub, is likely to contract by 3.6 percent this year because of the coronavirus pandemic, the central bank said on Wednesday.

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In the first quarter, the UAE economy shrank by 1 percent year onyear, with non-oil gross domestic product down by 3 percent, as opposedto hydrocarbon GDP, which rose by 3.7 percent year on year.

Arabtec said in October it mandated Swiss bank UBS to advise on a potential merger with Abu Dhabi’s Trojan Holding.

The company reported in February a net loss attributable to shareholders in 2019 of 774.5 million dirhams ($210.87 million), compared with a profit of 256.3 million dirhams in 2018.