{"id":7049,"date":"2023-03-03T15:59:00","date_gmt":"2023-03-03T13:59:00","guid":{"rendered":"https:\/\/www.coralynne.co.za\/blog\/?p=7049"},"modified":"2023-05-14T16:18:41","modified_gmt":"2023-05-14T14:18:41","slug":"construction-sector-waits-for-game-changing-action","status":"publish","type":"post","link":"https:\/\/www.coralynne.co.za\/blog\/construction-sector-waits-for-game-changing-action\/","title":{"rendered":"CONSTRUCTION SECTOR WAITS FOR GAME CHANGING ACTION"},"content":{"rendered":"\n

The outlook for South Africa\u2019s struggling construction industry remains uncertain, hovering between the massive infrastructure expenditure figures being publicly mooted and the state\u2019s seeming inability to implement its economic recovery plans. <\/p>\n\n\n\n

At this year\u2019s AfriSam Budget Breakdown event, now a regular highlight on the construction sector calendar, Econometrix Economist Dr. Azar Jammine pointed to raised expenditure targets for infrastructure. Dr. Jammine said he was encouraged by the growth from R812 billion to R903 billion in the estimates for public sector infrastructure expenditure from the 2023\/24 to 2025\/26 financial years. <\/p>\n\n\n\n

\"Richard<\/a>
Richard Tomes, AfriSam’s Sales and Marketing Executive. <\/figcaption><\/figure>\n\n\n\n

\u201cThese numbers are so big that if we were to see their full implementation, it would be a game changer not only for the construction sector, but for the entire economy,\u201d he said. \u201cWhere the real hope lies is in government getting its act together and starting to implement its capital projects.\u201d<\/p>\n\n\n\n

He noted the importance of how Finance Minister Enoch Godongwana dealt with plans to restructure Eskom\u2019s capital debt, as any worsening of the energy crisis could undermine the economic predictions in the budget speech. If loadshedding was exacerbated, he felt that the country may not even reach its meagre 0,9% growth target for the year. In such a scenario, government\u2019s own spending plans would be further dampened by lower tax revenues. <\/p>\n\n\n\n

The question he posed was whether there was the political will within the governing party to allow Eskom\u2019s debt restructuring to take place. Such a move was inevitable, however, as he foresaw a complete realignment of politics in the general elections of 2024.<\/p>\n\n\n\n

Focusing on the construction industry, Dr Jammine once again painted a sobering picture \u2013 but highlighted the sector\u2019s potential to deliver economic benefits. He reminded his audience that construction provides 7,8% of the country\u2019s employment, even though it makes up just 2,6% of GDP.<\/p>\n\n\n\n

\u201cImplementing government\u2019s infrastructure projects would spark massive job creation, and the economy would grow by 5-6% a year,\u201d he said. As it was, business confidence among building contractors continued to deteriorate, although last year this deterioration had slowed. <\/p>\n\n\n\n

\"Dr<\/a>
Dr Azar Jammine, Econometrix Economist at the AfriSam Budget Breakdown event.<\/figcaption><\/figure>\n\n\n\n

Commenting on Dr Jammine\u2019s presentation, Richard Tomes, Sales and Marketing Executive at AfriSam said: \u201cAlthough the operating environment remains challenging, one of the positive elements AfriSam has noted is the increase in the infrastructure spend budget allocation, and we remain hopeful that the implementation of the infrastructure projects will gain momentum and start delivering true value for the construction industry.\u201d <\/p>\n\n\n\n

Considerable overcapacity was still evident in the non-residential building sector, especially commercial office and retail space. The value of non-residential building plans passed averaged just about R1 billion in value compared to R3 billion in 2016. The brief recovery in the residential building sector \u2013 as homeowners renovated for home offices \u2013 had tailed off. Cement demand suffered negative growth in 2022, and was expected to improve only marginally over the next few years, he said.<\/p>\n\n\n\n

AfriSam SA Budget Breakdown Event<\/p>\n\n\n\n

About this annual event itself, Tomes remarked that AfriSam\u2019s purpose is to make valuable information available to the various stakeholders that interact with its business. \u201cWith many of us operating in the same industry, material matters such as the external environment we operate within not only relates to AfriSam but also to our stakeholders\u2019 businesses. We hope that the information being shared at an event like this will not only provide them with insight about some of the decisions that AfriSam takes but will also provide them with valuable insights to enable decision-making in their own businesses or organisations to ensure their future success and sustainability.<\/p>\n","protected":false},"excerpt":{"rendered":"

As the construction sector holds on for the more effective implementation of government\u2019s infrastructure expenditure programme, the recent national budget speech held both promise and uncertainty. Speaking at AfriSam\u2019s regular Budget Breakdown event in Johannesburg this month, Dr Azar Jammine said if government puts its spending plans into action, it would be a game changer for the economy.<\/p>\n","protected":false},"author":2,"featured_media":7059,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[32],"class_list":["post-7049","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-client-focus","tag-afrisam"],"_links":{"self":[{"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/posts\/7049","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/comments?post=7049"}],"version-history":[{"count":0,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/posts\/7049\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/media\/7059"}],"wp:attachment":[{"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/media?parent=7049"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/categories?post=7049"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/tags?post=7049"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}