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Feature Article of Tuesday, 20 October 2009

Columnist: Ahadzie, D. K.

Ghana In Need Of Construction Industry Development Agenda

By Dr D.K. Ahadzie

Centre for Settlements Studies

Kwame Nkrumah University of Science and Technology, Kumasi

An Introduction

There is no doubt that the Ghanaian Construction industry (GCI) (as in many other construction economies) holds the key to the development of the nation. Construction contributes to the national socio-economic development by providing significant employment opportunities at non-skilled and skilled levels. Beyond that, the industry provides the infrastructure and facilities required for other sectors of the economy to flourish such as; schools for education and training, factories and shops for commercial and business activities, housing for basic human needs, hospitals for health care, buildings for the national communications network and so on. It is the generation of these physical assets that many modern economies both developed and developing have successfully exploited towards achieving and sustaining the requisite socio-economic progress. However, exploiting the activities and outcome of the construction industry towards the anticipated socio-economic progress does not materialise on a mere haphazard and weak developmental framework but on aligning decision making to the existence of a well thought-out Construction Industry Development Agenda (CIDA). Indeed many modern societies such as the UK, US, Australia, Malaysia, Chile, China, Singapore, Brazil and South Africa have the Construction Industry Development Agenda robustly integrated into their national development agenda and indications are that, this has not only contributed to improving the competitive advantage of the respective domestic construction organizations, making them not only significant national and international players but also helping largely to lift millions of their citizenry from poverty. Presently, the national development agenda is to make Ghana a middle income economy by the year 2015 and/or 2010. Embedded in this aspiration is the anticipated “oil revenue” which if successful is almost likely to put construction demands to scales unprecedented in the annals of this country. The question to be asked is, is the construction industry ready for the impending opportunities and challenges ahead? and, are local contractors ready to make any significant contribution that would ultimately be of competitive advantage to the economy? These critical questions, among others, have yet to be consciously addressed when all indications are that, very much more would be demanded of the industry to stimulate the accelerated growth required for an anticipated middle income status. Indeed the scenario is such that there appears to be a lack of deep and firm understanding (even amongst professionals and practitioners) of the future of the industry in the national economic development agenda, a reflection of the poor national attitude to systematic planning, collaborative research, networking and documentation. Paradoxically, the two most recent Government blueprints, the Vision 2020 and Long Term National Development plan (2008) lack any robust policy framework towards meaningfully addressing the very many pertinent and perennial concerns of the industry. These include poor performance, poor quality of works, mistrust, lack of innovation and technology transfer and above all, lack of professionalism. Here, it is contended that, with the anticipated much talked about oil generation ensuing, there is no better time to put in place a rigorous CIDA than now so that indigenous construction companies in particular can appropriately strategise towards competing and playing a more influential role in the much needed socio-economic development.

What is CIDA?

Inasmuch as the GCI is alive and functioning, one could claim that there is some form of agenda driving it. However, here, CIDA is not just a mere form of ad-hoc, haphazard or latent vision (as we seem to practising in Ghana) but a diligently prepared and systematic framework with empirical legitimacy for driving decision making in the practice of the industry. That is, CIDA embodies a deliberate attempt to improve the capacity and effectiveness of the construction industry in order to meet demands of the building and civil engineering products. This agenda should also provide support for sustained national economic and social development by providing increased values in investments as well as environmental responsibility in the delivery process and the viability and competitiveness of domestic construction capacity. In effect, CIDA should aim at developing very detailed and pragmatic long term plans from which local contractors in particular can derive the greatest benefit towards national growth and development. Within this context, there are indeed many crucial issues that have to be addressed in the GCI such as, its philosophy in the national developmental agenda, its pedigree locally and the potential for the international market, its vision towards internationalization, its vision in the effective exploitation of natural and human resources, its response in using the industry for poverty alleviation, its response to global concerns on sustainable development, its future direction towards training and development, and performance measurement and improvement. Presently these issues (among others) are not evidently defined and addressed even though it is clear that the challenges ahead demands such painstaking exercise for the benefit of the industry.

CIDA in International Context

Indeed, the strategic importance of construction industry development agenda is an internationally embraced schema. It is therefore not surprising that a number of countries at different levels of development have in the past or recent past commissioned various independent and well resourced bodies (e.g. Construction Industry Development Board) to formulate such long-term plans for improving their respective construction industries. These include Australia (Australian Procurement and Construction Council,) Hong Kong, Singapore (Building and Construction Development Authority and later Construction 21 steering committee) and the UK (Latham report 1994: Egan, 1998), Institute of Construction Training and Development of Sri Lanka and National Construction Council of Tanzania. Others are the US (Construction Industry Institute), Malaysia (Construction Industry Development Board), South Africa (Construction Industry Development Board) and Denmark (Byggeriets Evaluarings Center). Reports of such other CIDA initiatives have been observed in other countries such as India, Brazil and Chile. Clearly, it is evident that, most entrenched construction economies have traditionally embraced the CIDA as key to construction industry development both nationally and internationally. It is high time Ghana draw on lessons from these best practices around the world towards effectively strategising for the emerging challenges ahead.

The Way forward

Evidence suggests that the role of the construction industry reaches its peak when a country attains the middle-income status. The GCI therefore has a huge responsibility towards championing Ghana’s economic recovery plan, especially in the anxiously ensuing oil boom. Concomitantly the challenges facing the industry especially relating to private sector development, growth and sustainability of professionalism would be enormous. CIDA offer the opportunity for a strategized response that cannot be underestimated at this crucial time of potentially emerging economic fortunes. Among others, some of the key issues that the Construction Industry Development Agenda would be expected to rigorously address is to set well grounded and empirically enriched indicators on the economic significance of the GCI, cost information, effective registry of firms and training agencies, promotion of competency-based training in various aspects of construction business, promotion of partnership and joint ventures between local and foreign contractors, profitability within the industry, employment generation and skills development, and the problems of fragmentation within the industry. Other issues relating to product development, project implementation, partnering the supply chain, production of component including issues relating to quality would all be critical for vigorous attention, Other issues for which robust indicators would be required relates to private sector involvement in infrastructure development, local response to the formation of regional blocs and common markets such as the ECOWAS, local response to global consensus on the need to use the industry to fight poverty, and local response to international concerns to sustainable development, especially environmental and ecological degradation.

Ultimately, a well resourced and clearly mandated body such as the Construction Industry Development Board (CIDB) would be required to oversee the development of the proposed agenda. Here, the overarching issue would be for the board to work for the benefit of improving local construction capacity amidst the strong inroads of globalization rather than making the industry a mere victim of an inevitable process. Therefore, the CIDB when established has the role of ensuring that their programme matches the national development agenda; competitive participation of local contractors, technical and managerial skills improvement, growth and expansion of domestic construction enterprise, employment generation capacity, delivery of quality work, efficiency/timely delivery of work and sustainability. Many organizations already exist in this country whose resources can be pulled together towards breaking this frontier. These include the Building and Road Research Institute, the Centre for Settlement Studies of KNUST, the Ghana Institution of Builders, Ghana Institution of Engineers, Ghana Institution of Architects, Ghana Institution of Surveyors, Building and Civil Engineering Contractors Association. What is now left is a strong leadership in pulling expertise from these organizations towards achieving a decisive collaboration. If the Government really believes that the growth of domestic business enterprises and job creation align with its developmental programmes then it is high time that the CIDA is adopted towards making reforms in the GCI.

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