UAE's biggest projects depend on smaller suppliers staying solvent
Payment cycles stretched from 66 days to 111 days in 2026, squeezing the suppliers that major UAE projects rely on.
Karim El-Sayed Karim El-Sayed covers company news, policy and regulation across the UAE and wider MENA for Anecdoted, with a focus on how new rules and licences reshape how startups operate. karim@anecdoted.com
The UAE's project pipeline runs across energy, infrastructure, construction and real estate. Delivering it takes more than capital at the top. Thousands of smaller UAE firms already hold the expertise, the staff and the appetite to join those supply chains. What they lack is cash.
Access to cash is the main obstacle facing small and medium-sized businesses in the Emirates in 2026. By most accounts it has been one of the hardest years in recent memory for managing working capital. Costs are up. Supply chains are more tangled and harder to navigate than they were. Firms are laying out money earlier and waiting longer to get it back.
The lag shows up plainly in transaction data. Average payment cycles in analysed transactions climbed from 66 days to 111 days during 2026.
Position explains much of this. Large contractors and government-related entities sit at the top of chains that fan out into hundreds of manufacturers, logistics operators, engineering firms, technology providers and specialist suppliers. Stretching payment terms downstream releases liquidity for the buyer at the top and pushes the financing cost onto everyone below. The further down the chain a firm sits, the less room it has to absorb that cost.
Those same large buyers, however, see a great deal. They know which suppliers were selected, which contracts were awarded, which work has been completed and which invoices have been approved. That visibility can make an entire supply chain more bankable. Verified transactions can be financed without the buyer paying its suppliers any earlier. Procurement systems can pass supplier and transaction data straight to capital providers. A large organisation can hold its own payment terms and still help smaller suppliers find liquidity.
None of that happens automatically. Financing a project does not mean liquidity reaches every business needed to deliver it. Supply chain resilience breaks at its weakest point, and a chain of fifty healthy suppliers does not compensate for one that cannot make payroll.
The practical case for fixing this is narrow and unromantic. A contractor with working capital can buy materials on time, keep skilled staff, take on new contracts and survive a delay without folding. Stronger suppliers produce stronger projects. That is an operational argument, not a charitable one.
Banks, financing providers, technology companies and policymakers each have a part to play. But the anchor organisations at the top of these chains hold most of the leverage, because they control the terms, the data and the procurement decisions that determine whether a small supplier can borrow against its own work.
Resilience has to be designed into a supply chain before disruption arrives, not improvised once it has. The structuring phase is where payment terms, data sharing and financing links either reach the last supplier in the chain or stop at the first tier.
