News: Construction Sector Suffers Monthly Loss Of Up To RM11.6bil Since MCO

Sep 21, 2020

Malaysia’s construction industry lost up to RM11.6 billion every month since the implementation of the nationwide Movement Control Order (MCO) on 18 March, reported Bernama.

Master Builders Association Malaysia (MBAM) President Foo Chek Lee revealed that 29% of the losses were because of the unemployment of industry workers.

“When construction projects were put on hold, machinery suppliers were unable to rent or sell their machines, factories could not manufacture construction materials, and imported materials could not come in,” he explained as quoted by Bernama.

“These are the reasons why the construction industry suffered up to RM11.6 billion per month.”

Read more: What Is LAD In A Construction Contract?

Although most construction works had already resumed when Malaysia entered the recovery phase, the industry is only operating at up to 80% of its capacity.

As such, Foo expressed gratitude for the various incentives and packages rolled out by the government to help the industry recover.

However, he hoped the loan repayment moratorium for construction-related firms would be extended by another six months.

Read more: What Happens To My Home Loan After The Moratorium Ends?

“As the moratorium draws to a close (on Sept 30), many companies feel that they would be unable to keep up with the repayments,” he said.

He revealed that around 30% of the construction firms in the country are still having financial issues. He noted that the extension of the moratorium until March 2021 could help protect one of the country’s most important economic sectors.

Founded in 1954, MBAM – which has 17,000 direct and indirect members – aims to be the recognised voice and prime mover of Malaysia’s construction sector.

 

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