https://www.engineeringnews.co.za
Africa|afrisam|Building|Civils|Construction|Engineering|Environment|Power|Projects|Repairs|Roads|Steel|Water|Infrastructure
Africa|afrisam|Building|Civils|Construction|Engineering|Environment|Power|Projects|Repairs|Roads|Steel|Water|Infrastructure
africa|Afrisam|building|civils|construction|engineering|environment|power|projects|repairs|roads|steel|water|infrastructure

Civil tenders awarded, hardware sales positives in the construction industry – Metelerkamp

5th March 2021

By: Irma Venter

Creamer Media Senior Deputy Editor

     

Font size: - +

There are some positives to be found in the South African construction market, despite the Covid-pandemic, says Industry Insight senior economist David Metelerkamp.

This first positive lies in the resilience of the civil engineering sector, where there was a 12.7% increase in civil tenders awarded in 2020 compared with 2019.

“Yes, we are at a very low historical level, but this is very good, considering that we are in one of the worst economic collapses in 100 years,” says Metelerkamp.

He says Industry Insight has seen a “a lot of activity” in the roads, power and water segments of the civils market, with a number of big projects awarded.

Unfortunately, tender activity was a little bit weaker last year, he notes, with civil projects out to tender declining by 4.8% in 2020.

“This was largely due to what happened in April and May, when everything shut down and there was no activity in these two months.”

More good news is that there was 15% growth in the estimated value of civil tenders that came out in the second half of 2020, year-on-year, says Metelerkamp.

“That is a lot better than expected, considering the circumstances.”

Metelerkamp does, however, note that there is a severe shortage in skills at municipalities and State-owned entities to implement infrastructure projects.

“It is positive, nonetheless, and we’ll take it.”

The second positive in the construction industry is a “significant boom” in do-it-yourself and home improvement projects.

Metelerkamp says the renovations market within the construction industry has done “really well” in 2020.

When looking at Statistics South Africa’s retail trade data, there was a 10.7% increase in hardware sales in the second half of last year, compared with a 3.8% decline in overall retail sales.

People are at home more during Covid-19, and this necessitates the need for repairs and renovations.

“We’re not talking small renovations either. It’s timber and steel. It’s structural materials. People are building a room onto their house,” says Metelerkamp.

“This is not exclusive to South Africa. We have seen this happening in other markets as well.

“Whether this can continue, is a good question,” he adds. “In the short run, yes, but, in the long run ­– it can’t go on forever.”

A third positive in the construction industry is the roll-out of government’s Strategic Infrastructure Projects, although this one comes with some caveats, warns Metelerkamp. 

“They have R360-billion for a list of 50, 51 projects which are shovel-ready, but I don’t buy that. Only seven are in implementation phase, according to documents by National Treasury.”

He again points to a severe skills shortage in government to implement these projects, while also emphasising the divisive nature of the current political environment, which is creating a lack of investor confidence.

However, he notes that government has “definitely prioritised” infrastructure, and that this a step in the right direction.

* Metelerkamp participated in the 2021 AfriSam Webinar Series.

 

Edited by Creamer Media Reporter

Comments

Latest News

Showroom

John Thompson
John Thompson

John Thompson, the leader in energy and environmental solutions through value engineering and innovation, provides the following: design, engineer,...

VISIT SHOWROOM 
Alco-Safe

Developed to exceed the latest EN 15964 standards for police breathalysers proving that it will remain accurate and reliable for many years to come.

VISIT SHOWROOM 

Latest Multimedia

sponsored by

Photo of Martin Creamer
On-The-Air (12/04/2024)
12th April 2024 By: Martin Creamer
Magazine round up | 12 April 2024
Magazine round up | 12 April 2024
12th April 2024

Option 1 (equivalent of R125 a month):

Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format

Option 2 (equivalent of R375 a month):

All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.

Already a subscriber?

Forgotten your password?

MAGAZINE & ONLINE

SUBSCRIBE

RESEARCH CHANNEL AFRICA

SUBSCRIBE

CORPORATE PACKAGES

CLICK FOR A QUOTATION







sq:0.168 0.223s - 152pq - 2rq
Subscribe Now