Ventures Onsite has hosted a live webinar dedicated in bringing support to the Middle East?s construction industry to review the difficult times ahead for economic recovery from the COVID-19 crisis
On 29 April, the online event gathered together hundreds of construction industry professionals from 30 countries worldwide as selected panellists shared their outlook for the months to come and what is understood now, and forecasted for the future from crisis to recovery. This was the second webinar in the Ventures Onsite online series that raised awareness to the ripple effect that will be felt by the construction sector, primarily due to the COVID-19 pandemic crisis affecting so many industries throughout the world - not only the construction sector.
Clive de Villiers, senior vice-president of contracts and quantity surveying services - C-Quest, a division of KEO Consultants, expressed, ?we should see a quick return to business for architectural consulting services once the lockdown restrictions are lifted. The construction market in Saudi Arabia is a key region and that while business is progressing today, the pace of activity is slow.?
Clive explained his expectations are for new construction awards to recommence in a few months? time as he understands most major construction development plans will proceed, especially in Saudi Arabia.
The construction industry contributes to more than six per cent of the regions GDP and a major driver for the region?s economy. Maintaining the construction industry momentum is a major consideration for governments around the region, evidenced by their decision for keeping construction sites open during this crisis period. Construction companies have implemented strict health controls that include daily site disinfestation and suitable social distancing measures for construction sites as well as transportation and accommodation facilities.
Supply of building materials for current construction activity has been with steady demand even though distribution and logistics channels were disrupted during the past two months, this was discussed by the selected webinar panel who also explained that this demand is expected to soften in the coming months until new buildings and infrastructure projects are released for construction.
Marwan Al Doh, organisational resilience and compliance manager for Ventures Middle East, explained that banks will require a detailed understanding of a company?s business risk prevention Planning and strategy as part of future financing application, a report that explains the company?s immediate financial response strategies, as well as, strategic plans for future risk prevention.
Marwan added, "It is understood banks will be increasing their exposure to construction as well as real estate.?
With an expectation that there will be less projects released during the next 12 months, the stage is set for considerable price drop of future project activity - mainly due to financial stress caused by the corona virus pandemic and the increased market competition. Price erosion is not a healthy business scenario, but in times like this, there needs to be some measures of stimulation to pull us all through the recovery process.
It was also discussed that extended supply terms will be a general business requirement as we progress to recovery and should be considered in everyone?s business planning now, for the future.
There was a general understanding during the webinar there will be less project activity during the next 12 months than was experienced in 2019. At this point, there is no definitive answer on what will be the actual impact or when the industry will be back to normal but the team at Ventures Onsite continue to review the market day by day. One thing we know is there will be recovery and we will once again see the resilient construction industry bounce back into action as we progress from this crisis to industry recovery.
