The construction sector’s prolonged ‘financial agony’ will end early next year as over 40 to 60% of the stalled projects are expected to recommence, said Chairman, Ceylon Institute of Builders (CIOB) Dr. Rohan Karunaratne.
The backlog of payments due to the industry stakeholders which amounted to around Rs. 240 billion too is being gradually paid and only around Rs. 60 billion remains.
“During bad times, we managed to get moratoria and other financial concessions and these helped the industry stakeholders to hang on,” he told the Construction Expo 2024 organised by the CIOB at the BMICH.
“Now we finally see the light at the end of the tunnel as stalled projects are expected to commence,” Dr. Karunaratne said.
Referring to the construction stakeholders, he said that they have taken a firm stance to reduce construction costs, which is one of the highest in the region.
“Sri Lanka’s construction costs are significantly higher than that of India, Malaysia, Vietnam, Thailand, Bangladesh, Manila and other such neighbouring countries, which is unacceptable as Sri Lanka is a developing nation,” Dr. Karunaratne said.
Foreign investors too are also reluctant to come to Sri Lanka due to high construction costs while funded projects cannot be completed within allocated funds. House builders and commercial/apartment projects too have also been abandoned due to abnormally high construction costs.
“The CIOB held a discussion with architects, engineers, contractors and material suppliers to discuss how to bring down this abnormal construction costs on par with neighbouring countries in the region and we have taken some meaningful steps,” he said.
It was identified that even from the initial design stage, over-designing; imported materials used by some architects; unregulated and costly unusual designs, increases the cost of construction.
“For contractors, the issues boil down to wastage, poor management and poor decision-making. He also said that corruption too has been attributed to the high construction costs.
“Such factors have led to a 24% increase in construction costs, which is clearly preventable by using LEAN methodologies and local materials and by implementing them we can be cost effective. However, we still would be unable to match the Indian prices.”
The CIOB also hopes to upgrade knowledge and awareness in innovative and environment-friendly concepts and social responsibility in raising the issues in the construction Industry in Sri Lanka.
Construction Expo 2024 from March 15-17
The Ceylon Institute of Builders (CIOB), the premier professional body of building and construction professionals in Sri Lanka will host Construction Expo 2024 from March 15-17 at the BMICH.
It will showcase the latest technology and development in the building and construction sector with eminent industry experts, stakeholders and decision-makers in attendance.
This will be the ideal event to source new products, network and accompany in new contacts and business opportunities.
Trade visitors from Sri Lanka and the neighboring countries are expected to take part in the event to exhibit their inventive products and visitors will also try to source the latest, inventive product launches with added features.