Construction Industry to Grow 8% in 2017
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Supported by a large number of major infrastructure projects, Malaysia's construction industry is forecasted to grow by eight percent to RM170 billion in 2017.
According to the Construction Industry Development Board's (CIDB) CEO Datuk Ahmad Asri Abdul Hamid, large-scale projects that will propel the sector include the Pan Borneo Highway linking Sarawak and Sabah, the Mass Rapid Transit Two in Klang Valley, and Johor's Refinery and Petrochemical Integrated Development (RAPID).
He revealed that the construction sector exceeded the performance of other economic segments after it recorded a high average growth of 11 percent during the introduction of the 10th Malaysia Plan from 2011 to 2015.
"Construction growth was 8.2 percent, or RM140 billion in 2015 and 7.4 percent, or RM166 billion last year" he told reporters during the Eighth Malaysian Construction Summit held in Kuala Lumpur yesterday (11 April).
In 2015, there was a total of 7,455 projects with a combined value of RM140 billion. Although the number declined to 6,305 projects in 2016, the overall value surged to RM166.4 billion.
The public sector only accounted for 29.1 percent, or RM48.5 million, of the projects in 2016, while the private sector made up 70.9 percent, or RM117.9 billion.
"The construction industry's growth last year was very much driven by infrastructure projects, which accounted for 49.7 percent (RM82.7 billion) of the total" noted Ahmad Asri.
"The second highest contributor was residential projects, which accounted for 23 percent (RM38.3 billion), followed by non-residential construction at 22.5 percent (RM37.4 billion)" he added.
Meanwhile, Works Minister Datuk Seri Fadilah Yusof, who officiated the summit, disclosed that the authorities are mulling to introduce rules requiring contractors and developers to provide certain amenities for their workers.
The new guidelines are anticipated to be included in a new law that will be tabled by the Human Resources Ministry by 2018.
He explained that the new rules, which conform to the global best practices, is already being implemented by large construction firms in Malaysia. Hence, the authorities will be focusing on small- and medium-sized companies.
"We are continuously engaging with industry players to ensure this will not be a burden. One suggestion is for small and medium-sized construction companies to have shared facilities for workers to manage costs" Seri added.