The construction sector has been battered by the first hard-lockdown and the Covid-19 pandemic and 30 000 jobs have been lost. The sector used to employ 60 000 Namibians.
|This was disclosed by the Construction Industry Federation’s Barbel Kirchner this week.
The sector has been a candle blowing in the wind ever since its disastrous collapse in 2015, a time when the sector used to be an economic beacon, contributing 7% to the Gross Domestic Product.
All that energy has fizzled down due to cyclical economic storms which dragged companies through one of the most difficult recessions in which the country suffered sub-normal growth.
A CIF survey exposed that government owed construction N$192 million in terms of unpaid invoices and about N$8,4 million in outstanding VAT refunds.
Speaking to the media recently, Kirchner said, “Speeding up payment will help the cash-flow position of some companies, but through a careful strategically mustered approach by actively engaging and focusing on the Namibian construction sector, we can make big strides forward,” she said.
Kirchner also said if this money is to be expeditiously paid to companies, the sector will begin to breathe once again.
In the first round of the lockdown, the sector lost a hefty N$6 billion.
Calle Schlettwein’s fiscal consolidation took away a number of lucrative projects while private local companies have had to compete with state-supported international companies most of which coming from China.
Now with Covid-19 requiring the closure of non-essential business in the first round of the lock-down, the construction industry was dealt a blow, shedding off an estimated 30 000 jobs.
The sectorial contraction meant that it could only contribute a paltry 2% to the economy owing to rampant company closures and tight cash-flows.
The finance ministry along and other government agencies owe construction about N$200 million in unpaid invoiced plus tax refunds.
