Construction exec sees big prospects behind the crisis

An executive from Cebu’s construction industry said the sector must look at the long term prospects of the economy and take careful decisions to weather the effect of the current global economic crisis.

Cebu Contractors Association (CCA) president Charles Sy said that although they are still unable to provide strategic information regarding the impacts of the global crisis to their sector, as a businessman he noted that bigger projects are currently put on hold while those which have been started were continued.

He said that this could be attributed to the continually decreasing price of oil due to the lower economic activity in our neighboring countries such as China.

He said that even prices of construction materials such as steel bars have gone down resulting to this lowered economic activity.

“China is one of the countries which had the biggest consumption of construction materials which made prices of these materials higher in previous quarters but now there is lowered economic activity,” he said.

Sy said that the housing sector still continues to build houses but so far the funding for these projects is becoming an issue.

He said that Pag-Ibig should increase its funding as slowdown in releases might dry up facilities and developers might decrease their construction activities in the long run.

Sy said that right now, there are no major projects undertaken by their members but as long as the government continues to service the construction industry for infrastructure development, they are still hopeful that no major decrease will take place.

Although it seems that the government is also becoming precautious in their service infrastructure programs, there have been no changes with their recent plans, said Sy.

“Smaller ticket construction projects will continue but big ones are careful now and withholding or extending,” he said.

After the height of issues on the collapse of the US economy, Sy is projecting that by year-end their sector will feel the “big bang” effect of this crisis.

He also said that they are seeing no major construction activities for at least six to 12 months.

“For those who have not started taking serious and careful look at the market, now is the time to be very careful and not venture into large developments until we see the effects of the crisis on us. But we should continue to service the industry on existing projects,” he said.

But if there are negative effects from the recent crises, there are also good things that have came up and among these were the lowered demand for fuel and other commodities which driven down its prices.

“We have to start doing something to weather the storm and we have to look at the long term that the economy will continue to improve. The current crisis is still far from the Asian financial crises so there is still room for better prospects,” he said.

 He said that the sector should continue to have careful observation and take necessary caution in every risks and decisions they do.

“There might be no optimism at this point but there is no pessimism as well especially that price of construction materials have gone down. But we have to really be careful,” he said.