By Wael Mahdi
Cabinet oagrees to extend exemption period of imported cement from local custom tariffs for two years.
Saudi cabinet on its Monday meeting held in the capital Riyadh agreed to extend the exemption period of imported cement from local custom tariffs for another two years, said the Saudi Press Agency.
The decision of the cabinet is believed to be a step to reduce the cost of construction material in the country that is witnessing a construction boom.
Starting from next January and for another two years, the government will keep paying the five-percent subsidy on tariff rate of imported cement that is imported from non-Gulf countries.
The cabinet said that importers of cement will have to pay the five-percent tariff on all imported cement to the Kingdom following the end of the two years extension period.
The Saudi cabinet had removed last year the protection tariff it used to impose on imported cement to protect infant cement industries.
The cost of many infrastructure projects that is under execution had increased recently due to the rise in the cost of the material.
Saudi Arabian Mining Co (Maaden) said in September that a phosphate venture it is developing with Saudi Basic Industries Corp (SABIC) will cost 21 billion riyals ($5.6 billion), 62 percent more than expected in March when they first signed the deal.
The state-owned Maaden said that the increase in the cost of the project was due to a rise in prices of materials in the international construction market.
In addition to rise in material costs, energy projects in the Gulf region face delays and cancellations due to a shortage of engineers and skilled labourers.For all the latest construction news from the UAE and Gulf countries, follow us on Twitter and Linkedin, like us on Facebook and subscribe to our YouTube page, which is updated daily.