Construction sector lost RM42b since MCO 1.0


THE construction sector’s losses since the first Movement Control Order (MCO) was enforced starting March 2020 amounted to RM42 billion to date.

Senior Works Minister Datuk Seri Fadillah Yusof said of the total, RM18 billion was the estimated loss during MCO 3.0, which was enforced from June to September this year, while the remaining RM24 billion was from MCO 1.0 last year, which affected construction works from March until July 2020.

The pandemic, and the movement restrictions that followed, had led to a decline in the growth of the construction sector, which dropped to 19.4% in 2020 and 10.4% in the first quarter of 2021 (1Q21) before increasing 40.3% in 2Q21.

“The construction sector is indeed among the industries that were affected by the pandemic.

“The ministry along with its agencies such as the Malaysian Public Works Department (JKR) and Construction Industry Development Board (CIDB) have done several meetings with industry players to find the solutions,” he said in the Dewan Rakyat while responding to a question from Jerantut MP Datuk Ahmad Nazlan Idris yesterday.

Fadillah said among the issues faced by industry players include the rise in costs of construction materials, as well as labour wage cost due to the lack of workforce.

“The smaller number of workforce in the construction sector is because the sector either had to wait for workers to be fully vaccinated or most of their employees were foreign workers that had gone back to their respective countries and unable to come back to Malaysia,” he said.

Other factors include additional cost for employers to prepare accommodation for construction workers, which takes into account the implementation of standard operating procedures amid the pandemic.

To overcome the problems, Fadillah said the ministry is aware of the additional expenditure inflicted on industry players and has proposed to the Finance Ministry to re-establish the provision for variation of price.

He added that the government has also agreed to relax specific recalibration requirements for construction workers.

Meanwhile, the Plantation Industries and Commodity Ministry (MPIC) aims to contribute RM12.5 billion in furniture export this year, up by 20% from total furniture export last year.

Minister Datuk Zuraida Kamaruddin said as of June, Malaysia’s total furniture export stood at RM5.58 billion.

In 2019, furniture export in the country stood at RM9.14 billion, while in 2020 it totalled RM10.63 billion.

“The top five countries that import our furniture products are the US, Japan, China, India and Singapore.

“The US remains the largest importer of our products for the (last) three years,” she said in the Dewan Rakyat yesterday to a query from Rompin MP Datuk Seri Hasan Arifin.

Zuraida said the government is mulling plans to ramp up furniture exports by identifying other high potential markets, such as countries with temperate forest.

Among the next export markets the ministry is eyeing are North America, Canada, India and the Middle East.

She also noted that the country’s rubber industry has been gloomy as its operations still largely depend on conventional ways of tapping rubber.

“The ministry is trying to develop a business model for small farmers in the rubber industry and we will develop policies to ensure that it is sustainable so that they can produce materials that we could export,” she added.