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Western Cape construction activity continues despite economic conditions

Construction growth - [http://www.constructionenquirer.com/wp-content/uploads/Theme-graph-up-growth-construction-600x414.jpg] Construction growth - [http://www.constructionenquirer.com/wp-content/uploads/Theme-graph-up-growth-construction-600x414.jpg]

“It would appear that much of the world’s economy, including South Africa, has taken on a holding pattern and this is further portrayed in the country’s GDP growth figures. However, Cape Town seems to have escaped the downturn and construction activity here continues to boost the local economy.” 

 

This statement was made by John Matthews, President of the Master Builders Association of the Western Cape (MBAWC), at the organisation’s recent Annual General Meeting.

Matthews elaborated on the state of the building industry in the province, saying, “We continue to see high levels of activity in and around the Cape Town CBD, the V&A Waterfront as well as the Atlantic Seaboard. These activities certainly indicate the level of confidence that investors still have in the future of our city.”

He added that both the Western Cape Government and the City of Cape Town have continued to award significant numbers of projects in the areas of health, education and housing.

“We are fortunate to have these two spheres of government that operate in a relatively efficient manner and also abide by the principles of good corporate governance, thus making a significant contribution to our local construction industry. I trust that this will continue now that the local government elections are done and the status quo in Cape Town, with regards to political leadership, has been re-affirmed.”

Matthews concluded by saying, “Although most of our members and the contracting fraternity at large seem to have reasonable order books and sufficient projects on hand, this remains a very competitive industry with tight tendering and low margins remaining the order of the day. Our industry seems to be fixed in a low margin mind-set and one wonders what sort of volumes of work would be required to raise profit margins to a level that would adequately compensate contractors and subcontractors for the risks that they expose themselves to in their daily business operations.”

For more information about the MBAWC, visit http://mbawc.org.za/.

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