Property & Infrastructure

Zim contractors more expensive than regional peers

PHILLIMON MHLANGA

Cash-rich National Social Security Authority (NSSA) says local contractors have to reform to regain competitiveness as the sector’s prices are higher than those of its regional peers.

A statutory body established in terms of NSSA Act of 1989 to provide social security, the authority is the largest depository of savings in Zimbabwe, with an investment portfolio of about ZWL$30.5bn.

Of this, about ZWL$8bn is in the real estate sector across the country.

NSSA chief property investment officer, Francis Nyambiri, said the pay-as-you -go pension scheme has also lined up a number of infrastructure development projects across the country, which have the potential to unlock opportunities in the construction sector.

However, the prices obtaining locally are expensive, Nyambiri said.

“We have lots of projects across the country in which we have engaged local contractors but, we have paid some school fees for that.

We are concerned when the (construction) sector becomes more expensive.

Zimbabwe contractors have become more expensive than most players in the region.

So, if you can reduce the cost of construction, it will be possible for NSSA to engage more local contractors.

Be creative so that we can stretch the dollar that we have,” he said.

It has not been rosy for Zimbabwe’s construction industry in the past few years as the sector faced a myriad of challenges related to the poor state of the country’s economy.

The industry has also been struggling to contain the influx of foreigners into the country’s construction industry.

They have been particularly unhappy with the Asians, especially the Chinese, who they said were having a field day due to lack of protection of the local construction industry.

This, they said, has resulted in local construction companies retrenching, downsizing operations or collapsing.

Since 2009, when Zimbabwe adopted the multi-currency regime to escape hyperinflationary pressures, the government through the State Procurement Board, which was replaced by the Procurement Regulatory Authority of Zimbabwe, has been awarding government tenders to foreigners, especially the Chinese.

The situation greatly affected local players, who expressed disquiet over their marginalisation in government projects.

Local contractors have been saying they should be given more projects to create employment in the country.

They also claimed that they have failed to access internationally funded projects such as the ones funded by the World Bank and African Development Bank in the country as the government demanded a lot of guarantees from local players.

This has remained a major obstacle for the sector’s growth.

Nyambiri indicated that opportunities abound but local contractors need to improve on their pricing models.

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