Ghana
Answer ... The impact of the COVID-19 pandemic on the construction sector included:
- supply chain disruptions and material shortages;
- delay, suspension, postponement and termination of projects;
- delays in payments;
- redundancies;
- increased costs and reduction in turnover;
- liquidity challenges for contractors; and
- increased health and safety measures for the workforce.
Post-pandemic, it is clear that companies should focus on matters such as:
- digital construction;
- smarter project management; and
- better health and safety processes.
Ghana
Answer ... Ghana’s construction sector was worth about $10 billion in 2021. Between 2013 and 2021, it contributed an average of 7.2% to gross domestic product. Over the last year, the sector has contracted as a result of:
- the COVID-19 pandemic;
- the destabilising impact of the Russian-Ukraine war on global prices and supply chains;
- the impact of elevated costs for materials, energy and labour;
- rising inflation; and
- high interest rates.
Generally, 2022 was a difficult year for Ghana although the Ghana Statical service advised that the construction sector recorded a growth of 0.1% in the 2nd quarter of 2022. The country’s fiscal and debt vulnerabilities worsened amid an increasingly challenging external environment. The government requested assistance from the International Monetary Fund in early Summer 2022, a staff-level agreement was reached in December 2022 and a $3 billion extended credit facility was announced in May 2023, with immediate disbursement of $600 million. Debt restructuring agreements are required for the successful implementation of the arrangement.
Despite the above, the outlook for 2024-2027 is for a return to growth in the construction sector.
The government is the largest infrastructure provider in Ghana and relies heavily on public-private partnership projects and concessional financing for infrastructure development.
Infrastructure as a top priority for the government includes a focus on:
- water resource management;
- the management of protected areas;
- coastal and marine erosion;
- provision of transport infrastructure;
- information and communication;
- construction industry development;
- drainage and flood control;
- infrastructure maintenance;
- rural and urban development management;
- disaster management; and
- health infrastructure.
Various construction activities are ongoing and planned in these areas.
The government is investing in ongoing initiatives and programmes aimed at the development of infrastructure, including:
- One District One Factory, to provide at least one factory in each of Ghana’s 216 districts;
- One Region, One Industrial Park, to develop an industrial park for each of Ghana’s
- regions; and
- AGENDA 111, for the construction of 111 hospitals throughout the country.
There have been calls by civil society activists for the government to streamline the construction industry and develop a comprehensive regulatory regime for Ghana’s construction industry in order to:
- ensure safety;
- increase professionalism; and
- promote industry best practices.
After repeated pressure from stakeholders, the Construction Industry Development Authority (CIDA) Bill is likely to be passed into law. The CIDA Bill is expected to bring increased safety and professionalism to the construction industry.
There are also proposals to develop a local content policy for the construction sector. This will ensure that Ghanaians are prioritised in terms of employment in the construction industry. A local content law will make collaboration essential between local and foreign firms.