Asean is on a building spree |
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Asean is on a building spree

Published on Friday, 14 Oct 2011
Illustration: Bay Leung

Sustainability is the word on the lips of the region's major players in construction today. And like' world peace', it's the thing that everyone wants to achieve, though views and methods differ on how best to get there. In any event, the concept of sustainability has spawned a huge industry-within-the-industry.

"If you're in this line of work and have any green credentials or accreditations or work-experience, put these at the top of your CV. Hiring is brisk now for professionals with this kind of background," says environmental sustainability consultant Trevor Smith, who divides his time between the two high-growth hubs of Kuala Lumpur and Shanghai.

"KL appears to be leading the way in Asia-Pacific," Smith says. "Right now, and in coming months, the Malaysian capital is a hotbed of opportunity."

According to government statistics, Malaysia presents a US$67.8 billion (HK$528 billion) market for both residential and non-residential construction. And the international business research and consulting firm Frost & Sullivan has calculated that growth of non-residential building construction will outpace residential building construction by 3-5 per cent annually until 2015, in this high-performing sector of the Malaysian economy.

"Malaysia's overall construction sector - including 'green construction' - is expected to grow a bit slower this year than last, though this is still 'firm growth' by the standards of the faltering global economy. There's above-average growth in KL, Selangor, Penang, and in Sabah," Smith says.

Malaysia's neighbours - all part of the Association of Southeast Asian Nations (Asean) - are also enjoying construction booms. Brunei's Vision 2035 plan has allocated US$9.5 billion for the National Development Plan up to 2012. Projects include public-service facilities and buildings, and infrastructure upgrades.

Meanwhile, the outlook for Philippine construction is mixed. State figures suggest it will grow, but slower than the GDP. Private construction is tipped to expand, particularly with residential projects that will address the roughly four-million-housing backlog, as well as commercial projects and tourism facilities.

Because of the expected growth in the construction sector, Philippine imports of building products are projected to increase by at least 5 per cent through 2012. Suppliers can still find opportunities in this huge market, the third-largest English-speaking nation in the world, leading to enhanced hiring opportunities. 

Vietnam is also experiencing a construction boom, thanks to sustained urbanisation in Hanoi and Ho Chi Minh. According to the Vietnam Construction Association, the building industry will be implementing a programme to develop housing through to 2020. It targets the construction of an additional 30-32 million square meters of housing across the nation, so as to meet the government goal of providing at least 12 square meters of living space per person. 

Global investors are increasingly optimistic about Vietnam's economic prospects, and have reiterated their commitment to current projects and investment, such as some of the large infrastructure projects that started this year, including the Co Chien Bridge in the Mekong Delta, Hanoi's Belt-Road Number 3, and part of National Highway 1A in Thanh Hoa Province.

Meanwhile, Vietnam's Northern Airport Corporation is preparing to start construction of the second passenger terminal at Hanoi's Noi Bai International Airport, at the end of this year. The Civil Aviation Administration of Vietnam said the owner of the second terminal, T2, and relevant authorities were reviewing construction and consulting packages, and were selecting and hiring qualified contractors.

Vietnam's fundamental advantages remain among the best in the region, notably its cheap but increasingly skilled work force, and relative political and social stability due to its strong government.

Indonesia's potential is now so conspicuous that a United States investment bank recently said the BRIC economies of Brazil, Russia, India and China - which have been fuelling global growth in recent years - should now include Indonesia. Such sentiment is impacting construction favourably. Its GDP may increase as much as 7 per cent next year, said Melchias Mekeng, head of the parliament's budget committee.

Indonesian President Susilo Bambang Yudhoyono plans to double spending on roads, ports and airports to US$140 billion by the end of his term in 2014. 

In neighbouring Singapore, the Building and Construction Authority has projected the value of construction contracts awarded in 2011 and 2012 at between US$18 and US$25 billion.

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