acquisitions and joint ventures. Internally, we are looking to innovate, and create new opportunities within our industry to further reduce our vulnerability to periodic downturns in individual markets. Despite the recession’s warning bells clanging around the
globe, we have held onto our hopes for expansion and con- tinued to forge ahead with our strategic growth plan. We placed our faith in our strong management team, resilient business model and the innovation of integrated engineering to weather the coming storm. When we all earn a little breathing room from the economic slowdown, it is important to recognise the patterns of behaviour that led up to the recession. What goes up must come down; it is a part of life and part of doing business. But what in particular exacerbated the effects of the downturn for the construction industry in the region? Firstly, a general naïveté was probably to blame. The
local industry should have been more alert to the potential impact of global markets, and based on this it should have developed alternative strategies. One should also note the pattern that could bring one
out of such difficult times. Contractors and developers have become far more transparent in their communications, closely interacting on issues of payment rescheduling and project delivery. As governments in the region consider stepping up their investment in infrastructure, contractors stand to gain from the need for schools, universities, roads and bridges. At a time when confidence in the industry is at an all-time
low, some developers are restructuring debt to inspire further confidence among offshore investors in the financial structure. To further bolster international trust in our markets, regulatory bodies could streamline the claims processing mechanism, closing out pending issues quickly and efficiently. But most of all, what the real estate and construction industries have learnt is prudence. We have learnt the hard way to wait for the appropriate time to build projects and watch market conditions (supply and demand trends) before planning any big changes.
While both developers and contractors will certainly tread carefully in the future, it is important to see things as they are and not worse than they are
Saleh Muradweij
As the dust settles on the recession, a more savvy construction industry will emerge: one that is efficient and maximises productivity while minimising overheads. Contractors should also consider geographical expansion and maintaining a diversified portfolio, whether that diversity is expressed geographically, in customer base or in verticals. At DSI, while we will continue our aggressive expansion tactics, we will focus our attention on one sector and one country at a time. There is a sense of cautious optimism in the market now as many believe the worst is
behind us. While both developers and contractors will certainly tread carefully in the future, it is important to see things as they are and not worse than they are. If an opportunity exists, take it. If you spot a gap and have the resources, fill it. If a new
market looks ripe for change, capitalise on it. The recession has separated the professionals from the amateurs; now is the time to cement your position as market leaders.
jun-sep 2010
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