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SINGAPORE: Construction demand this year is expected to fall by billions of dollars, after COVID-19 hit the industry and paralyzed projects.
The Building and Construction Authority (BCA) said on Thursday (September 17) that it had revised its projected construction demand to between S $ 18 billion and S $ 23 billion for the year, below its January forecast. S $ 28 billion to S $ 33 billion.
Last year, the sector registered contracts worth S $ 33.52 billion.
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The downward revision comes after a drop in private sector construction demand and the award of some public sector projects was postponed from this year to next, BCA said.
“Contractors and vendors (had) requested more time to assess the impact of COVID-19 on resource management and project implementation schedules,” BCA said.
This year, the public sector is expected to account for between S $ 11 billion and S $ 14 billion of all construction contracts, down from the S $ 19.03 billion recorded last year, BCA said in its projections. .
Private sector construction is forecast to generate contracts of S $ 7 billion to S $ 9 billion, down from the S $ 14.5 billion reported in 2019.
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The construction sector has been severely affected by COVID-19 and the measures taken to curb the pandemic.
Singapore imposed a “breaker period” on April 7 to stop the spread of COVID-19, shutting down all non-essential businesses. It exited the circuit breaker on June 1 and entered Phase 2 of its reopening on June 19.
During the circuit breaker, construction also came to a halt, affecting the schedule of projects and raw materials.
After the projects were gradually resumed in Phase 1 of the reopening, the labor shortage among the migrant worker population remained a challenge.
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BCA said construction demand is expected to recover “to some extent” starting next year, in part due to public residential development and improvement works.
The agency highlighted the development of Jurong Lake District, the construction of new healthcare facilities, and infrastructure projects such as the Cross Island Line.
READ: Punggol’s Cross Island Line extension to begin construction in 2022
In a Facebook post Thursday, National Development Minister Desmond Lee noted the impact of COVID-19 on the “construction process and schedule” and the challenges faced by industry players.
“Despite the restart, the industry still faces challenges,” Lee said.
“The silver lining is that we expect demand to recover somewhat next year, and there will be a portfolio of public sector projects coming online next year,” he said.
He added that BCA and other agencies will continue to provide assistance, including financial assistance, to the industry.
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