Construction sector has potential to boost economy: Salgado

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Head of the Asian Development Bank (ADB) Extended Mission in Solomon Islands, Amila Salgado, presenting a certifificate to a participant of the training, who is the managing director of Premier Real Estate, Julie Gegeu Haro.

By Mike Puia

Head of the Asian Development Bank (ADB) Extended Mission in Solomon Islands, Amila Salgado, presenting a certifificate to a participant of the training, who is the managing director of Premier Real Estate, Julie Gegeu Haro.

THE country’s construction sector holds huge potential to boost the economy, says Amila Salgado, head of the Asian Development Bank (ADB) Extended Mission in Solomon Islands.

Salgado made the comments at a graduation ceremony in Honiara last week.

Over 40 locals representing the Ministry of Infrastructure Development (MID) and local construction firms graduated after completing a Civil Construction Certificate Program.

Salgado said the program is important and timely intension for the country as the construction industry has a remarkable contribution to sustainable economic development by satisfying some of the basic objectives of development.

He said these basic development objectives include output generation, employment creation and income generation and re-distribution.

The ADB representative said the program also plays a significant role in satisfying basic physical and social needs.

He noted these basic physical and social needs include the production of shelter, infrastructure and consumer goods.

“Construction is one of the most dynamic and responsive sectors. It is a powerful sector in the economy” Salgado said.

He said the sector has highly visible output that can stimulate economic growth as it has strong linkages between construction and other sectors.

This is because the sector involves stakeholders like property builders, property developers, material and labor suppliers and contractors.

Salgado said the sector has an essential role in the economy which is reflected in the Central Bank 2017 report.

The report stated that “the key sectors driving growth in private sector lending were construction distribution, tourism, transport and manufacturing”.

It highlights the growth of the construction industry. It estimated that the sector contributes about 0.2 to 0.3% of the Gross Domestic Product.

“I believe this will continue to grow with the scale of operations of ADB and World Bank as well as other development partners supported projects like Cable and Munda Airport Projects”, Salgado said.

He said there are many factors that constrained construction industry ranging from capacity of the private sector, lack of skilled workforce, tax and immigration policies and regulations, absence of monitoring of contractors’ performance, difficulties in obtaining required guarantees and securities due to weak financial capacity of the local contractors, bureaucracy to corruption.

He believes training those who work in the sector will address the critical constraints, lack of skilled and educated workforce that are experienced in the sector.

The training program, supported by Australian and Solomon Islands governments and ADB, is facilitated by international facilitators from Performance Training and Civil Contractors Federation (PTCCF).

The training program is conducted under the MID through the National Transport Fund (NTF).