The Building and Construction Authority (BCA) expects the total value of construction contracts to be awarded this year to hit between $28 billion and $35 billion, up from last year’s preliminary estimate of $26 billion, with the public sector accounting for about 70 percent of total construction demand, it said in a statement.
The BCA forecast demand from the public sector to increase from about $15.8 billion last year to between $20 billion and $24 billion in 2017, on the back of an increase in demand for most building types and civil engineering works.
Private sector construction demand, on the other hand, is projected to remain subdued at between $8 billion and $11 billion this year, in view of the continued economic uncertainties and the property market slowdown.
In 2016, total construction demand was slightly lower than expected due to the re-scheduling of major public sector projects to this year given that such projects require longer preparation times.
Looking ahead, average construction demand is expected to reach between $26 billion and $35 billion per annum in 2018 and 2019, and between $26 billion and $37 billion per annum in 2020 and 2021, said the BCA.
“Although the year-to-year fluctuations in the total value of annual construction demand are influenced by the lumpy nature of major infrastructure projects, the overall on-line construction activities or construction output is expected to stay at a relatively high level,” said the BCA’s CEO, John Keung.
“Companies that are prepared to change, innovate and transform to stay at the forefront of technological innovation, process re-engineering and productivity improvements are more likely to sustain their growth and competitiveness despite the headwinds under challenging economic conditions.”