Construction potential seen stimulating economy

Stakeholders in Nigeria’s construction industry say there is hope for the country’s recession-ravished economy if the industry is given greater attention and its growth potential harnessed for the purpose of stimulating the economy.
Though only five percent of the country’s 170million population is employed in the industry whose value is estimated at US$69.4 billion, the industry is globally acclaimed as one of the most vibrant, with capacity for creating jobs and generating wealth.
The growth prospect of the industry is so high in Nigeria that close watchers expect that by 2020 the country will alongside India, enjoy higher growth rates than nations like China, and by 2021, it will triple its investment value.
Typically, the story of the Nigerian construction industry is that of growth. It is projected to be the fastest growing of all markets in the next ten years and as disclosed by the latest ten-year forecast by  Global Construction Perspectives and Oxford Economics, the fastest industry growth will happen in this country from 2018.
“The contribution and impact of this industry to the economy cannot be neglected as it has become a veritable index when it comes to employment generation for both skilled and unskilled labour in Nigeria, and it is estimated that this industry contributes 3.2 percent of Gross Domestic Product (GDP)”, says, Solomon Ogunbusola,  former President, Federation of Construction Industries (FOCI).
Ogunbusola sees growth in construction industry’s’ investment value  if more attention is given to the sector which he explains, is not only about road construction,  but also about transformation in rail and air transportation.
The shock from the oil and gas industry bust has made it necessary for the Federal Government to focus on the the construction industry which John Odeyemi, an industrialist, has identified as a growth area in the economy, advising  President Muhammadu Buhari to focus on it, especially now that the economic recession is biting hard.
Ibikunle Ogunbayo, former President, Association of Consulting Engineers of Nigeria (ACEN), agrees, highlighting the industry’s great potential in terms of  job creation and wealth generation for those involved directly or indirectly in any given construction site.
According to Ogunbayo, the construction industry is the best to invest in when the economy is low because of the economic activities it can generate. Ogunbayo further explains that when N10 billion is invested in oil and gas, it could create about 200 jobs but if that same amount of money is invested in construction, it is most likely to create 500-1,000 direct and indirect jobs which will make significant impact in the economy.
Challenges however remain and these are the areas industry players want  government to fix to enable the industry stimulate the economy.  Apart from the problems of skilled labour and heavy indebtedness to the industry, which Babatunde Fashola, the minister of Power, Works and Housing, estimates that at N600 billion,  growth there is hampered by lack of machinery and equipment.
For too long, the Nigerian construction industry has been dominated by foreign firms for reasons which industry players attribute to low rate credit facility which foreign firms enjoy from their home countries that enables them to procure equipment much easier than their Nigerian counterparts.
Olurotimi Akinlose, Residential Auction Company’s (RAC) CEO, says Nigeria is among the top four African countries that import construction equipment and building material machines, along with South Africa, Algeria and Egypt.
“Data obtained from Construction Equipment and Building Material Machines within VDMA German Engineering Foundation, estimates the amount of construction equipment and building materials imported by Nigeria between 2010 and 2014 at US$2.8 billion, with import peaking in 2013 at US$ 680 million”, Akinlose notes, advising that government should intervene at a time like this to ease this constraint.

 

CHUKA UROKO