Maldives construction sector sees 50% drop after being hit by Covid-19 crisis
The industry will face a loss of MVR 205 million on a monthly basis
Construction site
The Maldives National Association of Construction Industry (MNACI) has revealed that the country’s construction activity has seen a 50% drop ever since being hit by the Novel Coronavirus (Covid-19) pandemic.
In an online press conference on Tuesday, the association’s President Mohamed Ali Janaah shared details of a report that enlightens the impact of the pandemic on the construction industry, deemed the second biggest economic sector after the main source of revenue, tourism industry.
As such, the report notes that the construction sector stands to lose about USD 40 million within three months and that the cancellation of all Public Investment Projects (PSIPs) under the budget for 2020 has resulted in a “direct loss” of MVR 7.2 billion to the construction sector.
The report goes on to estimate a loss of MVR 205 million on a monthly basis over the next few months, in terms of project interruptions related expenses and food, accommodation for the work force in the construction industry.
With this being said contractors in the Maldives are also struggling to acquire pending payments for invoices from government institutions. In light of this, they are unable to pay rent as well as employee salaries, due to which employees are also facing difficulties in managing their rents. Some employees in the industry have also been terminated or had their salaries slashed due to the economic impacts of the pandemic.
MNACI proposes a three-tier recovery plan which revolves around ensuring the progression of the sector through stimulus funds and easing regulatory approvals as well as restarting the industry safely by creating awareness among workers. Further, it proposes to ease procurement and transform the industry through rapid recruitment techniques.
The construction industry employs the largest workforce of expatriates in the country. As such, there are about 5,000 – 7,000 construction workers and 40,000 – 50,000 migrant workers in the sector.
