COMMENT
Hope springs
eternal
P
Leon Louw
[email protected]
A healthy
construction
sector in South
Africa is vital
for the health
of the plant
equipment and
hire sector but it
does seem that
all companies,
including the
medium and
small contractors
are struggling.”
www.equipmentandhire.co.za
lant equipment and hire company
owners continue to hope for a
recovery of the beleaguered
South African construction
sector. Although the mining industry has
presented some opportunities, and
countries in East, Central and West
Africa has kept the pot boiling, big ticket
construction projects in Southern Africa
is still the bread and butter of the
equipment sector.
Sanral, at least, has released a number
of tenders, but this is clearly not enough
to revive what was once a prime South
African economic sector. The bottom line
is that our country’s construction sector is
terminally ill, and whether it will recover
even during the Ramaphosa era is an open-
ended question. The rot runs deep, and the
filter feeders like equipment suppliers are
getting squeezed beyond repair.
At least Ramaphosa has given us a
glint of hope. The overall feeling at the
recent Consulting Engineers South Africa’s
(CESA) breakfast, during which its newly
elected president Sugen Pillay presented
his presidential message, was one of, let’s
call it, “more hope than before”.
According to Pillay, South Africa once
again finds itself in the throes of a new era.
“We are certainly in a period of great change
but there is also a sense that through
this process, we are indeed in a period of
renewal and regeneration,” he said.
There is no doubt that the Zuma years
had a devastating effect on the South
African construction sector, however, there
is a wholehearted attempt by Ramaphosa
to correct the mistakes of the past. A
major concern for CESA is the lack of
skills in the public sector, which Pillay said
can be overcome by utilising skills in the
private sector. He added that many civil
engineers are prepared to volunteer to get
the construction sector up and running
again. “CESA’s call is that, as a short- to
medium-term measure, the capacity that
exists within the private sector should
be utilised to, firstly capacitate the state,
and also to mentor some of the young
engineers that are currently employed in
the state,” Pillay said.
A healthy construction sector in South
Africa is vital for the health of the plant
equipment and hire sector but it does seem
that all companies, including the medium
and small contractors are struggling. Pillay
believes that the key issue is the lack
of opportunities coupled with delayed
payments for completed work.
“The reason that so many contractors
find themselves in financial distress
is that a project pipeline has not been
forthcoming. “If this decline in the
construction value chain is not arrested as
a matter of urgency, the entire construction
chain will be decimated within a very short
space of time. The consequences for
the economy and for the country will be
catastrophic,” said Pillay.
Wise words from someone who
has a lot of insight into what makes the
construction sector tick. It is astounding
that the South African government
continues pouring money into clearly failed
state-owned enterprises like South African
Airways and Eskom, while the country’s
construction sector is bleeding and newly
established contractors, and owners of
equipment and hire companies, are being
choked. To save a few thousand jobs at
dysfunctional government-run entities,
at the expense of tens of thousands that
could be employed in the private sector,
for the sake of outdated ideologies, is
laughable. To resuscitate, action is needed
now, not later, or after deliberation with
unions and alliance partners. But is there
political will?
Leon Louw
MARCH 2020
1