Reports of the demise of the construction industry in South Africa are greatly exaggerated, says construction giant Grinaker-LTA.
Responding to fears that the construction industry is in its death throes thanks to the delisting from the JSE of Group 5 and ESOR and the sale by some of SA’s top construction companies of its buildings and infrastructure units, Grinaker-LTA says South Africa’s construction industry is nowhere near being wiped out.
“There is no doubt that the industry is experiencing serious headwinds due to stagnant growth, low business confidence, lack of investment and now COVID-19 but there is still plenty of life left in the old dog,” insists Bheki Mdlalose, Group Managing Director of Grinaker-LTA. “Like all other South African sectors and like South Africans themselves, we are having to be very inventive and adjust to a new reality with low to no growth, but there are always opportunities for the intrepid.”
Grinaker-LTA points out that while many of the country’s top construction companies have lost up to 80% of their value or been significantly downsized, they still have the knowledge available to be able to scale up quickly to implement massive infrastructure projects.
“Under the new leadership, Grinaker-LTA has right-sized and is focussed on resetting the business so that it can ensure a sustainable future. As the macro-economic environment improves and the South African economy starts growing again, we will still have the intellectual property, technical expertise and experience to be able to undertake the most complex projects. We have no doubt that our competitors will also be able to do so,” says Mdlalose.
Grinaker-LTA points out that there will always be a need for the development and maintenance of infrastructure – both by government and the private sector – and that technological advances and emerging sectors – such as the renewables sector – provide the construction industry with a steady pipeline of work.
It also believes that the substantial infrastructure build programme announced in April by President Cyril Ramaphosa will help the sector to tread water while business confidence and investment is restored.
Grinaker-LTA says it is excited about the inaugural Sustainable Infrastructure Development Symposium of SA, which will be hosted by the President on June 23, as it will point the way to much-needed infrastructure investment in South Africa. The symposium is expected to provide a credible infrastructure pipeline across six priority areas: water, transport, energy, digital infrastructure, human settlements, agriculture and agroprocessing.
Concludes Mdlalose: “Like everyone else and given the new realities, the construction industry is having to box clever but I have no doubt that it will survive, albeit not unchanged. Grinaker-LTA has experienced many a recession and crisis in its over 125-year history, but we are still around to tell the tale and we have no doubt that we and our competitors can still deliver.”