25 April 2013
Qatar is negotiating with Fifa to cut the number of stadia it builds for the 2022 World Cup to eight or nine from the 12 originally planned because it is concerned that the construction market could overheat, Bloomberg has reported.
Bank of America Merrill Lynch is reported to have said in a note to investors following meetings with the Qatar 2022 organising committee that costs are likely to exceed the bank’s initial estimate of $95bn for tournament preparations.
Qatar had agreed to spend as much as $65bn on infrastructure and venues for the world’s most-watched sporting event.
The grand plan includes stadia equipped with solar-powered air conditioning, a doubling and more of hotel and apartment rooms, and a $25bn rail and metro network.
Concerns over the construction market "overheating" have been raised in Qatar. (Credit: Amjra)
Alberto Ades, head of emerging-market fixed-income strategy at Bank of America Merrill Lynch, said in the note to investors that building the infrastructure will have to be carefully phased to avoid "overheating", Bloomberg said.
Consultant EC Harris has predicted that construction inflation in Qatar could soar to 18% during the peak construction period between 2016 and 2019 as the unprecedented volume of building activity constrains materials supply, logistics, and the basic capacity of firms to handle the work.
"We are fully committed to delivering on the commitments we made to Fifa," Yasir Al Jamal, technical director of the organizing committee, said in a statement, according to Bloomberg. "The requirement is a minimum of eight and a maximum of 12 stadiums. We are currently working on delivering our first five stadiums," he said.