Government’s credibility issues are affecting the civil construction sector
A serious credibility problem with the government’s so-called “shovel ready” and bankable major infrastructure projects have been blamed for confidence in the civil construction industry remaining at near-record-low levels in the third quarter of this year.
Read: State’s infrastructure programme criticised for lacking details
The latest FNB/Bureau for Economic Research (BER) Civil Confidence Index released on Tuesday revealed that confidence rose to 11 on a 100-point scale in the third quarter from the record low of five index points in the previous quarter.
The current index level means that almost 90% of respondents are dissatisfied with prevailing business conditions.
FNB/BER said downbeat prospects for work over the next few quarters also kept confidence low.
In the third quarter of 2020, a slightly higher percentage of respondents than the already elevated level in the previous quarter stated that the demand for new work, a proxy for company order books, was insufficient given normal business requirements while tendering competition intensified, FNB/BER said.
The fieldwork for the third quarter survey was conducted between August 12 and 31 this year.
All talk?
David Metelerkamp, the senior economist at construction market intelligence firm Industry Insight, was brutal in his assessment of the latest confidence levels in the sector.
“I think it’s a very good indicator that all the ‘shovel ready’ project talk is a load of nonsense.
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