Construction is a key component of our Gross Domestic Product, GDP. It enjoys complex linkages with various sectors of the national economy, both vertical and horizontal. It is labour-intensive, and thus a key source of employment. Because of very few entry barriers, the construction industry provides a wide range of enterprise models which drive it.
We have large construction companies, some with international links. We also have several home-grown companies which are beginning to get contracts beyond our borders. Above all, we have small partnerships, sole proprietorships and small-to-medium enterprises in this sector. All this provides variety and colour to the industry, including opportunities for subcontracting partnerships.
More significantly, construction enjoys larger multipliers we must harness as an economy.
Every dollar invested in construction yields larger returns and benefits to the overall economic output, and by way of employment benefits. In United States of America, for example, studies show that every dollar in construction outlay multiplies to GDP increase of $3.02.
Besides, it is an industry with a high job and earnings multipliers, quite apart from increasing the national stock in fixed assets. It therefore follows that the performance of our national economy is highly correlated with the performance of the construction industry. We thus must continue to stimulate this vital industry as best we can.
Looking ahead, several interventions are needful. First, we have to keep fighting inflation. The cost of money must remain low to stimulate investments in, and to encourage borrowing for, this sector. That includes the mortgage sector. We have to fight rising costs in the building industry, principally those related to building materials. This will allow more construction activity in the country, in line with our NDS1.
Second, our construction industry must continue to invest in new technologies which bring greater efficiencies while meeting the needs of our fragile physical environment and ecosystems.
The use of steel and aluminium will go quite some way in ensuring more housing units are delivered in shortest possible time, at least cost, while meeting environmental standards. The iron and steel projects underway at Manhize and in Masvingo should greatly assist.
Third, we have to deal with the problem of informalisation of human settlements, which has a direct bearing on the construction industry, principally the residential subsector. All unplanned settlements need to be regularised after proper geo-spatial surveys and proper land-use plans which protect our delicate environment, principally our wetlands and water sources. I am happy that the Ministries of Housing; Higher and Tertiary Education; Local Government; Lands; Justice; and Environment are working in harmony, all in the spirit of whole-of-Government approach. Once regularised, homeowners must be given title to secure ownership.
Fourth, we have to find a formulae for delivering basic amenities and services at all settlements. Broken and dysfunctional municipalities have cost us greatly, including creating chaotic settlements which do not have even the most rudimentary amenities. Central Government might have to intervene to ameliorate this sorry situation. The hazards to public health are enormous, and require very urgent preventive interventions.
Fifth, land for construction is finite. We thus have to move towards densification in our human settlement plans so we use residential and non-residential construction land optimally.
I am happy this is beginning to happen, including at rural growth points where blocks of flats for Government workers are now being piloted, Mutawatawa in Uzumba-Maramba-Pfungwe being a case in point. Our human settlement plan requires that 40 percent of allocated land should go towards construction of flats.
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