{"id":8431,"date":"2024-02-28T09:55:00","date_gmt":"2024-02-28T07:55:00","guid":{"rendered":"https:\/\/www.coralynne.co.za\/blog\/?p=8431"},"modified":"2024-03-01T10:03:53","modified_gmt":"2024-03-01T08:03:53","slug":"little-cheer-from-budget-speech-but-construction-resilient-afrisam","status":"publish","type":"post","link":"https:\/\/www.coralynne.co.za\/blog\/little-cheer-from-budget-speech-but-construction-resilient-afrisam\/","title":{"rendered":"LITTLE CHEER FROM BUDGET SPEECH, BUT CONSTRUCTION RESILIENT \u2013 AFRISAM"},"content":{"rendered":"\n

It was a sombre tone at this year\u2019s annual AfriSam Budget Breakdown event, but sales and marketing executive Richard Tomes reminded stakeholders that the company\u2019s 90 years in business should be an inspiration that the construction sector remains so resilient.<\/p>\n\n\n\n

AfriSam\u2019s Executive Chairman Eric Diack agreed the company had seen many ups and downs, and hailed the Johannesburg event as an important forum for AfriSam and its stakeholders to gain vital insights to chart the path forward.<\/p>\n\n\n\n

A regular contributor to the Budget Breakdown, Econometrix Chief Economist Dr Azar Jammine highlighted that the construction and building industries were still in the doldrums, with little sign of emerging from it soon. Dr Jammine pointed to the low economic growth rate and the poor level of gross fixed capital formation as the key culprits of the challenging milieu. While the Budget Speech contained a theoretical commitment by government to focus on infrastructure, there was not much to boost confidence.<\/p>\n\n\n\n

He noted that private sector capital investment in South Africa had shown some improvement, but this was mainly in machinery and equipment. Investment in construction \u2013 including civil engineering \u2013 and building had declined 40 to 45% over the past decade. The slight recovery in residential building between 2020 and 2022, as a result of the Covid-19 pandemic, had faded.<\/p>\n\n\n\n

\u201cThis is horrific, and there is little sign of it recovering,\u201d he said. \u201cThe big loser is in the commercial space, which has fallen by 80% in terms of plans passed.\u201d<\/p>\n\n\n

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Employment in the construction industry also continued to drop, and isnow 40% down from 2019 figures. The sector\u2019s contribution to national employment is today only about 4,5%, having been over 6,5% around 2017.<\/p>\n\n\n\n

\u201cNo other sector in the economy has been performing as badly,\u201d he said. This was also reflected in the retail sales at builders\u2019 merchants, which now ranked as the weakest segment of the retail sector.<\/p>\n\n\n\n

Dr Jammine reiterated that crime was also a central factor in holding back progress in the construction industry, and was encouraged by the Business Leadership South Africa\u2019s workstreams to work with government on energy, transport and crime.<\/p>\n\n\n\n

\u201cI don\u2019t need to remind members of this audience of the debilitating effect that the construction mafia are having,\u201d he said. \u201cI only hope that government will listen to the private sector and involve them more in finding the solutions.\u201d<\/p>\n\n\n\n

With the \u2018semi-gration\u2019 of many South African professionals to the Western Cape, he noted that this province had recently taken the lead over Gauteng in terms of residential building plans passed. There had been a slight rise in numbers in Gauteng recently, however, which may point to a revival.<\/p>\n\n\n\n

According to Richard Tomes, AfriSam Sales and Marketing executive, the insights from Dr Jammine confirmed that the construction industry will remain under pressure for some time.<\/p>\n\n\n\n

\u201cHowever, what we can learn from AfriSam\u2019s 90-year legacy is that the industry is very resilient,\u201d he said. \u201cOver the past 90 years we have seen good times, and we have also survived through extremely tough times.\u201d<\/p>\n\n\n\n

He said he believed the construction sector \u2013 as with AfriSam \u2013 will come through this challenging period and will continue to create concrete possibilities for South Africa.<\/p>\n\n\n\n

\u201cAs AfriSam, we look forward to being the construction industry\u2019s partner of choice through thick and thin,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":"

Despite the sobering messages from the Budget Speech, the construction sector remains resilient \u2013 exemplified by construction materials leader AfriSam turning 90th this year. AfriSam gathered its stakeholders again for its Annual Budget Breakdown event in Johannesburg, to hear insights from Econometrix\u2019s Dr Azar Jammine. <\/p>\n","protected":false},"author":2,"featured_media":8432,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[31],"tags":[32],"class_list":["post-8431","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\/8431","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=8431"}],"version-history":[{"count":0,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/posts\/8431\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/media\/8432"}],"wp:attachment":[{"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/media?parent=8431"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/categories?post=8431"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.coralynne.co.za\/blog\/wp-json\/wp\/v2\/tags?post=8431"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}