MBSA Congress: Growing opportunities for the building industry

This was the message by the Minister of Public Works, Thula Nxesi at the opening of the annual Master Builders South Africa (MBSA) Congress being held at the Wild Coast Sun in KwaZulu-Natal.

Nxesi stressed the point that government has committed the resources, but the crucial thing is how the projects are implemented. Admitting that the Department did not have technical professionals, he encouraged real and lasting partnerships between the public and private sectors in order to achieve growth for both and infrastructure as a whole. He also stated that proper collaboration can ensure transparency and root out corruption in both sectors.

He also appealed to MBSA and established contractors to commit to assisting in the development of emerging contractors. Mentoring of new talent will allow for the growth of professional and quality skills in the construction industry. Nxesi believes that strengthening the bargaining council within the construction sector is imperative in order to prevent tragedies, such as the Marikana incident within the mining sector.

Global GDP will drop

Political analyst and futurist, Daniel Silke said due to the global economic crisis, an age of uncertainty has been entered into, especially by developed countries, and is defined by budget cutbacks and changed workforce demographics. This will result in a drop in the global gross domestic product, which will allow for emerging markets to grow. Silke said that in about five years' time, a critical shift will happen and 75% of economic growth will come from emerging markets. As economic and infrastructure growth go hand-in-hand, this is a positive prediction for the construction industry and will open up many opportunities.

High economic growth, combined with population expansion predicted for the nations of emerging markets, will lead to rapid urbanisation and create a demand for quality infrastructure. However, due to the fact that there will be an abundance of skills from these many emerging markets, infrastructure industry will become highly competitive and the South African market will need to ensure it provides quality in order to benefit from this global change.

Looking at the changes brought on by the global economic crisis and population expansion in developing countries was speaker Francois Viruly, associate Professor of the Department of Construction Economics and Management at the University of Cape Town. Viruly agreed that these global trends would lead to rapid urbanisation, especially in Africa, and the residential property market will see the biggest change. This will affect the construction and building industry in a number of ways. In the past, growth of South African cities have shown a total lack of densification compared to other cities around the world, but rapid urbanisation will require more high density housing.

Connecting cities is a challenge

Moreover, Viruly explained that as rates, taxes, electricity and other operating costs continue to be inflated, buildings will need to rise in efficiency by 30-40% in order to lower costs. He went on to say that connecting the city would be a challenge. Currently, South African households spend 20% of their household income on transport - the same amount as they spend on housing - and infrastructure will need to find a way to make transport more cost effective.

Property around the transport lines will become highly valuable and the industry will need to ensure that they correctly construct in these areas in order to benefit from this opportunity. Concluding, Viruly stated that the challenge for the industry will be to accommodate the rising demand for housing and preventing urban spread caused by poor town planning.

Included in the programme was an interactive session, which allowed delegates to engage in dialogue regarding sustainability issues in the construction environment. Although it was agreed that environmentally friendly technologies are initially more expensive, construction needs to move towards building infrastructure that is sustainable by ensuring that the structure has a long-term life span, is equipped to reduce running costs and lowers its use of increasingly scarce resources.