Covid-19 disruption still heavily impacting construction operations in South America and Africa

25 September 2020 (Last Updated September 25th, 2020 16:33)

GlobalData has been conducting surveys of construction industry executives globally to gauge the extent to which they have been subject to the impact of COVID-19. The pandemic and restrictions imposed on movement and economic activity worldwide have greatly impacted the construction industry, and in many regions companies in the industry are still facing major obstacles in their attempts to return to normal.

Covid-19 disruption still heavily impacting construction operations in South America and Africa

GlobalData has been conducting surveys of construction industry executives globally to gauge the extent to which they have been subject to the impact of COVID-19. The pandemic and restrictions imposed on movement and economic activity worldwide have greatly impacted the construction industry, and in many regions companies in the industry are still facing major obstacles in their attempts to return to normal.

According to the latest survey, companies in South America are still being severely challenged by the crisis, with 35% responding to state that they had suffered major disruption and continue to face major obstacles, and 33% stating they continue to face minor obstacles. Respondents based in Eastern Europe and Australasia appear to have suffered the least disruption and relatively minor obstacles as they strive to return to a normal level of operations. For example, in Eastern Europe only 7% of respondents stated that they had suffered major disruption and continue to face obstacles in their attempts to return to normal operations. Respondents were also questioned on their expectations of project cancellations amid the COVID-19 crisis. Globally, 34% of respondents expected 10-20% of projects to be cancelled, with 29% expecting project cancellations to be below 10%. Firms in Australasia appear the most positive, with around 40% not expecting any project cancellations.

The challenges and obstacles that companies are facing in their efforts to restart operations and return to a normal level of activity are varied, but a large proportion of respondents stated that a major issue to deal with has been the additional expenses related to making sites and premises COVID-19 secure. In total 65% of respondents stated that this was a challenge they faced in restarting operations. Based on the survey results, other key challenges included the adherence to local regulations, notably social distancing rules and self-quarantining of workers, with 47% of respondents stating that these regulations were preventing them from operating at full capacity. This was closely followed by firms having to deal with contract disputed over delays in project timelines, with 42% of survey respondents claiming that these types of disputes were disrupting their efforts to return to normal operational levels. Although 35% of respondents said that they had been suffering from supply chain disruptions with regards to materials and equipment, these disruptions do not appear to have resulted in a major surge in costs; only 19% of respondents had stated that higher prices for materials and equipment had been a factor in restarting operations. Fewer than 30% of respondents said that they had struggled to access government support programmes or faced shortages of labor.