PETALING JAYA: A total allocation of RM180 billion in the construction sector for government and private sector projects will be up for grabs this year, according to Deputy Works Minister Datuk Seri Ahmad Maslan.
He said the allocation approved for the Federal Government’s development expenditure in Budget 2024 makes up RM90 billion while the rest comes from the private sector.
“In the middle of this year, many tenders and letters of acceptance will be given out, which will further boost the construction sector.
“I cannot estimate the value of the tenders to be issued by the private sector. However, I estimate that 40 per cent of the RM90 billion allocated for government development expenditure will be given out in the middle of this year,” he said during the MIDF Luncheon Talk on “Awaiting take-off of construction sector” organised by MIDF Research here today.
According to him, the projects to be tendered include school, hospital, clinic and road projects.
Ahmad said the construction sector has long served as the cornerstone of Malaysia’s economic growth, boasting a substantial and influential multiplier effect, of which the impact ripples across various interconnected sectors.
He said the country’s construction sector has continued to show a positive trend.
“The construction sector has maintained its positive momentum for seven consecutive quarters, recording a 6.8 per cent year-on-year growth in value of work done in the fourth quarter (4Q) of 2023 to RM34.1 billion,” he said.
Ahmad also noted that the most recent data from the Construction Industry Development Board (CIDB) underscores the industry’s vitality, with 2,772 projects totalling RM31.34 billion awarded in the first quarter of 2024.
While slightly below the figures of the previous year, this presents promising and favourable opportunities for industry stakeholders, he said.
On the advancement of the construction sector, he said Malaysian construction firms are making their mark on the global platform.
“Despite the movement control order in 2020, the value of overseas projects managed by local construction companies continued to rise, showcasing their resilience and competitiveness in the international arena,” he shared.
In addition, Ahmad said, the construction sector’s impact on service exports saw a significant turnaround.
“From a troubling quarterly deficit of RM4.25 billion in 4Q 2017, the sector has rebounded impressively. According to the most recent data, it boasted a substantial quarterly surplus of RM12.49 billion in 4Q 2023,” he said, adding that this represented the sector’s largest surplus since data collection began in the first quarter of 2005.
In a separate development, he said that of the 775 construction projects under the ministry’s purview, only three per cent are categorised as “sick projects”.
“Nonetheless, among the issues that need to be given attention in the sector is the delay in project completion. There are too many requests for time extension from contractors,” he said.
Therefore, Ahmad proposed that the next step in the sector’s development should involve the integration of the latest construction methods and technologies into the sector’s activities.
He said the environmental, social, and governance (ESG) elements should also be given serious attention for a sustainable future.
“With the government’s continued support, I am confident the sector is prepared to achieve a higher level of performance,” he added.
