Communique on “The Impact of Covid-19 Pandemic on The Nigerian Construction Industry: Challenges and Opportunities” Issued by The Nigerian Institute of Quantity Surveyors

Preamble:

The COVID-19 pandemic and its attendant lockdown effects on economic activity is presenting a range of challenges to the construction industry.  The Federal Government aptly responded to the pandemic with the issuance of Covid-19 and the Quarantine Regulation 2020 on 29th March, 2020, pursuant to the Quarantine Act of 1926. While the need for compliance with the Regulations remain non-debatable, it comes with real consequences on the Construction supply value chain. The Pandemic affects the way and manner stakeholders operate to deliver construction projects. Consequently, there will be defaults in construction contracts, leading to cost overruns, extension of time, claims, disputes of various magnitude among others. The overall impact on the industry is dependent on the severity and duration of the pandemic in Nigeria and globally.

 

Assessing the impact of Covid-19 Pandemic:

A web-based Seminar was held by the Nigerian Institute of Quantity Surveyors on 5th May, 2020 to evaluate the effects of Covid-19 Pandemic and present necessary recommendations to Government, construction industry stakeholders and the general. The theme of the Seminar was “THE IMPACTS OF COVID-19 PANDEMIC ON THE NIGERIAN CONSTRUCTION INDUSTRY: CHALLENGES AND OPPORTUNITIES”.  Six renowned and experienced Quantity Surveyors drawn from both public and private sectors were invited to discuss various issues related to the theme.

 

Recommendations:

At the end of the Seminar, the following recommendations were made:

Government:

  1. The three tiers of Government need to prioritise their spendings and focus more on procurement and provision of necessary healthcare facilities. The construction aspect of the health care facilities will go long way in boosting activities in the sector, thereby creating jobs in the Industry.
  2. Government should increase spending on researches at Universities, Polytechnics and research Institutes across the Country with a view to stimulating groundbreaking outcomes/findings. This may result into immediate discovery of potent vaccines and drugs for the disease and consequently transforming the Nation to a knowledge based economy.
  3. Government should explore additional and viable sources of revenues.
  4. Encourage companies to increase manufacturing of local materials, including possession of automated production models that can fast-track availability of construction materials and goods, thus filling the void created by lower importation.
  5. Stimulus should be provided to construction organizations to enable them cushion the effect of the pandemic. This will minimize lay-off rate and reduce negative social-economic impact of the pandemic.
  6. Central Bank of Nigeria should give priority consideration to players in the construction Industry as well. In addition, government should speed up access to CBN intervention funds to facilitate quick recovery of the construction sector.
  7. Government should through the Central Bank of Nigeria prevail on commercial banks to reduce interest rates for firms in the construction supply value chain. This will make investment within the construction sector more attractive and will boost its activities.
  8. Tax holiday should be extended to companies in the construction supply chain to mitigate the effects of the pandemic on their businesses.
  9. Government should enforce construction organisations’ compliance with mandatory workers’ compensation insurance.
  10. Government should promote greater compliance to cashless policy to tame the spread of the Covid-19 pandemic.

 

Construction Industry Services Providers (Contractors, Consultants, Manufacturers etc):

  1. Manufacturers and construction companies are encouraged to form strategic alliances to attract government attention and support.
  2. Firms should invest in new Information and Communication Technology tools to be able to adapt to changing industry needs.
  3. Construction firms should optimize off-site assemblage of construction components. This will minimize disruption of remote working and supply chain activities.
  4. Acquisition of new technology in the industry. This will require the use of technologies such as drones, robots etc.
  5. Consultancy practices should consider diversification as a viable strategy to meet the challenges of post Covid-19 recovery. An evolving and important area is the sustainable development and adoption of green building technology. This is the current and viable direction of global practices in the built environment. Corporate firms must explore and maximize the business perspectives of this evolving trend globally. This will assist in mitigating long term impacts for present and upcoming practitioners.
  6. Health and safety protocols and designs should be entrenched within the companies and on site to minimize the effect and curtail the spread of the pandemic.
  7. Construction industry professionals should review construction contract standard forms to take care of future eventualities similar to COVID-19 pandemic and its effects on the execution of contract.
  8. Industry professionals should embrace the concept of re-skilling and capacity building for satisfactory and sustainable performance of their functions as well as evolving practices.
  9. There should be renewed emphasis on Professional Indemnity Insurance by professionals.
  10. appropriate strategies should be developed to comply with the need for remote working in meeting clients’ and employers’ requirements.