Housing, collaboration and procurement were the three themes TT Contractors’ Association president, Glenn Mahabirsingh, chose to focus on at the organisation’s annual gala, Hilton Trinidad, St Ann's, last Saturday.
As the construction sector positions itself for a more buoyant 2020, boosted no doubt by the local government elections in December and the general election scheduled for next year, contractors are hopeful that the industry, which has been in a slump, can recover with the host of infrastructural projects on the cards.
Mahabirsingh, in his address, again welcomed Government's plans to re-tender its 6,000-unit housing programme after cancelling the contract that had been granted to Gezhouba Group International Engineering Co Ltd (CGGC), in September, due to concerns about the terms agreed to with the Chinese firm. He said a subsequent meeting with Housing Development Corporation (HDC) chairman Newman George led to an agreement to consider contractors' views on the project and future housing plans.
"We have been given the opportunity to consult with our members and submit suggestions on the best way forward for the reissue of a request for proposal (RFP) for what has the potential to be a huge economic stimulus programme."
He said the housing initiative will benefit a large amount of people – labourers, specialist engineers, project managers, even food vendors.
"Six thousand units by 2020 plus 3,000 units per year on a consistent basis is a boon to the industry. It targets two markets – the small and medium builders with five to 10 houses and the large housing contractors. This is a reasonable volume to employ and retain the sector’s resources," he said.
"In this regard, the TTCA welcomes the $1 billion housing bond that will assure the industry that the necessary funds will be available to pay for the planned construction in a timely manner."
Mahabirsingh also saw the potential of ongoing school repair and infrastructure projects.
"Additionally, we welcome the $1 billion to be spent on repair and refurbishment of schools," he said, adding that on the infrastructure side, "there is a reasonable flow of projects already in train or in the pipeline to invigorate the industry."
He identified the San Fernando to Point Fortin Highway extension, the San Fernando Waterfront project, the Curepe Interchange and the Valencia to Toco highway programmes, as well as plans for the UWI, Macoya, Trincity and Piarco interchanges.
Even as he commended the government initiatives, Mahabirsingh also called for timely payments to contractors – as outstanding balances reached as high as $1 billion over successive administrations in the past decade.
"We understand the cash flow challenges arising out of the country earning less revenue. However, we cannot overstate how vital it is for contractors to be paid within a reasonable time frame. A reasonably healthy cash flow is the lifeline of survival in the contracting world.
Going forward, he said contractors must form alliances or risk losing out to foreign firms on local projects.
"To benefit from these large housing and infrastructure projects, we need to work together. This might not have been required 10 years ago. Then, everybody could be their own boss. But, today, we face new realities and we run the risk of being relegated to the role of subcontractors who are led and managed, rather than capable companies who lead and manage projects."
Local contractors have to join forces to pool financial resources to be competitive.
"Mega projects are going to foreign firms because, while local players have the technical capacity to compete, they do not have the financial resources to match their foreign competitors who can usually access favourable external financial support, which gives them a competitive edge over local contractors."
He disclosed the HDC encouraged the association to collaborate to bid for jobs to be competitive on the level of foreign bidders.
"We must come together and develop a strategy to further grow our industry locally. If diverse stakeholders could create a consortium to bid on a contract, we are much likelier to succeed, and at the same time build even greater capacity."
Cooperation must extend beyond contractors and include stakeholders in finance and general services.
"I am not only talking about two or more contractors forming alliances but also banks, insurance companies, hardware dealers, specialist material suppliers, equipment suppliers, architectural firms and engineering firms – the entire spectrum of interests that earn revenue from construction."
The model is a proven one, he said, referring to collaboration in the insurance industry and even on the Curepe interchange which he advanced as a blueprint for alliances in the construction sector locally and in the region. The interchange, he said, is a joint venture of three firms with sub-contractors and material suppliers and gave additional examples of Home Solutions partnering with Readymix on the East Lakes residential housing project; and, in Guyana, where Kee-Chanona Ltd is in a joint venture with Guyana’s Nabi Construction & Engineering Inc to build Exxon’s headquarters.
"That project also highlights another important reason to form alliances – earning foreign exchange. We need to have regional jobs in our basket of projects that will not only enable us to weather local lulls but earn badly needed foreign exchange."
He said collaboration between the industry and government can "achieve win-win solutions." One area the association expects to have addressed by year's end is a resolution to the red sand shortage and the issue of Class 7 heavy equipment driver permits.
And, Mahabirsingh, was also hopeful the Procurement Act will be finally proclaimed in new legislation in 2020, as outlined in the budget. He had this message for Government, represented at the gala by Works and Transport Minister Rohan Sinanan.
"The TTCA urges the Government to consider possible opportunities to accelerate this timeline way before the 2020 mid-year budget review. TT needs this legislation implemented and functioning. Be the Government that can boast of bringing further integrity, transparency and modernisation to public procurement. Have it fully in place, operational and established well in advance of the next general elections. It is the best gift you could give to the industry and to the people of TT."
PUT IN BOX
TTCA 2019/2020 Board of Directors
Glenn Mahabirsingh – president
Rodney Cowan – vice president
Hugh Schamber – secretary/treasurer)