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Opinions of Tuesday, 5 January 2010

Columnist: Ahadzie, D. K.

A Synthesis Of The Historical Development Of The Ghanaian Construction Indsutry

By Dr D.K. Ahadzie

Centre for Settlements Studies

Institute of Human Settlements Research

College of Architecture and Planning

Kwame Nkrumah University of Science and Technology

INTRODCUTION

One of the principal ways in which modern societies generate new value is through the exploitation of construction activities to achieve social and economic ends. In a typical modern society, around half of all physical assets are created by the construction industry generating about 5- 10% of national wealth (Gross domestic product). Thus the Ghanaian Construction Industry (GCI) if well exploited could be very strategic in championing the accelerated growth that would help take millions of the citizenry out of poverty. However, after 50 years of existence of the formal industry, very little has consciously been done towards tapping its full potential in the National Development Agenda. Concomitantly, very little is known to the general public about its core characteristics and potential for academic and especially industry use, as a result of lack of access to any standard contemporary textbook of rich local content. As a contribution towards addressing this missing link, the author is currently editing a comprehensive handy standard text towards promoting the core characteristics of the industry including the challenges it faces in promoting the infrastructure development needs of the country. Here, excerpts of sections of the text are produced for the benefit of the reading public with the aim of knowledge promotion and also to generate debate for future editing. Given that most entrenched future aspirations thrives on understanding and appreciating the historical antecedents prevailing, this first edition of the serial provides an extracts of the historical development of the Ghanaian Construction Industry.

EARLY BEGINNINGS OF THE FORMAL CONSTRUCTION INDSUTRY

The early beginning of the formal Ghanaian Construction Industry (GCI) is reflection of Ghana’s historical link with Britain. Hitherto, construction in this country was a non-commercial family vocation restricted largely to the provision of village shelters of mud and wood. The form of construction during this period was largely very simple rectangular and circular single-storey shelters designed by family heads and constructed by family members and friends as communal labour. The rectangular buildings were often found in Southern Ghana whilst the circular shelters were common in the Northern parts. In both forms of construction, the materials used were normally located within the settlement and were in their raw form including thatch for roofing. Drawing from developments of global construction practices as evidenced in history of architecture and/or construction, it sounds reasonable to argue that the type of construction forms in Ghana in the colonial era and the immediate aftermath had its root in rudimentary crafts handed down by family heads. Typical of pre-historic times, the construction practices could be described as “crude at it best” especially because of its very elementary and unscientific nature. Obviously, traces of such shelters can still be found in many of the typical rural villages across the breadth and length of the country.

EUROPEAN INFLUENCE AND THE ERA OF STATE CONSTRUCTION CORPORATION

European influence , especially, British adventure introduced what could be argued as a more scientific and professional approach to the provision of houses and other related infrastructure in the ensuing years. To this extent, the provision of sandcrete (i.e. cement and sand) block houses based on architectural working drawings became popular. Furthermore, the introduction of reinforced concrete design paved the way for the proliferation of multi-storey structures, some intricately sophisticated. More significantly, the formal GCI as we see today comprising clients, contractors, architects, quantity surveyors, engineers etc. is a British development handed down as a result of the well known historical links. Really, during the pre-independence era, local construction capacity especially with respect to local construction companies) was totally non-existent in any recognizable form. It is therefore not surprising that, almost all construction contracts were awarded mostly to British Conglomerates during this period. Naturally, the trend began to change when the care-taker government of Nkrumah was sworn in the early 1950s. Subsequently the then Ghana National Construction Corporation (GNCC) was formed. On attaining independence, the GNCC was renamed the State Construction Corporation (SCC).

Indeed one of the key policy intentions in forming the GNCC (SCC) was to help provide a purely Ghanaian construction competitor for the foreign entrenched European firms. The evidence indicates that the SCC highly competed favourably and was responsible for the successful completion of many major significant projects across the breadth and length of the Country. Indeed at its peak the SCC was involved in about 60 per cent of all public projects in Ghana won through competitive bidding. Moreover, the SCC was able to internationalize by landing lucrative jobs in Lome-Togo and even as far away as Angola. Indeed, it is noted that, as a public company, the SCC fared very creditably and had the potential of becoming a major international player at least in the sub-continent. Surprisingly, things did not work out that way as the company consistently started posting dwindling performance in the early 1980s and thereafter. Obviously the poor state of affairs could no more be tolerated by the Government of the day. Hence at the peak of the Structural Adjustment Programme in 1986, the SCC was later to be divested (privatized) by the PNDC Government with the hope that this move would help revamp its fortunes. Sadly, the SCC could not wake-up from its slumber and folded up by late 1990s.

As to whether it was a wise decision for the SCC to be divested, experts of economic theory would have their own argument on the “pros” and “cons”. Whatever ones position is however, the reality is that the SCC after starting so successfully could not stand the test of time and is now defunct. Interestingly the competitive character displayed by the SCC in its prime era provided the much need impetus and confidence for some Ghanaian entrepreneurs to congregate in forming some of early indigenous private construction companies. This was actually the opportunity for local construction capacity to be entrenched so that these private firms could stand up to their foreign counterparts in the share of the market. Unfortunately, it later turned out that, the capacity of these infant companies was relatively so weak; there was no way they could have competed favourably with the relatively well-endowed foreign firms who already had a somewhat revered experience in the markets. Relieve it was, when in 1973, the National Liberation Council (NLC) government set up the Bank for Housing and Construction with the sole aim of providing loans to enhance the financial position of local firms. Ostensibly, the idea was to give them a comparative benefit so that they could improve upon their operational capacities towards becoming competitive. Indications are that the scheme also started quite well, and many of the companies that availed themselves posted some remarkable performance to generate confidence in the potential of a competitive local construction capacity. Interestingly, the Bank for Housing and Construction is also now defunct following bankruptcy in the 1990s.

SOME REFLECTIONS

There is no denying the fact that, since independence, various Governments have attempted to introduce modernity and professionalism towards improving local construction capacity and making it more competitive. However, when current standards are examined within the context of contemporary global construction practices, the Ghanaian industry could be described as being at the cross road. After 50 years of independence typical rural construction practices remain virtually unchanged from what pertained in colonial times. Alternatively, while urban construction has integrated into modern tenets, the form of construction practices still appears relatively very elementary technologically unsophisticated and outmoded. The technical and managerial capacity of local contractors has many a time also been questioned. The reality is that, in this age of complexity and technologically driven high quality projects, Ghanaian contractors like many of their counterpart in the sub-region are yet to be integrated. Paradoxically, the Government of Ghana (GoG) even finds it prudent to award any iconic contract of major significant and monumental image to expatriate firms at the expense of local expertise. Of course, it is much easier to criticize contractors for lack of development in the industry since they are the forefront of producing the end product, however, apart from their own weaknesses which admittedly is managerial and professionalism, it is also true that there are many systemic problems (e.g. perennial delays in payment procedures) that have not helped in engendering their growth. What is interesting is that, many of the systemic failures are known to policy makers and project implementers so it beats one’s imagination why they have not yet been addressed after several decades. “Is it a case of the proverbial Ghanaian attitude of talk, talk, talk but no action?” Clearly, strict adherence to “professional project management” practices should be helpful in minimizing some of the worst effects of these systemic problems. Where then comes in training and education? To be fair, construction education in this country is of very high international standard and cannot be faulted for current the lack of growth in the operational capacity of local contractors. Furthermore and as stated above, there other many economic and policy-driven factors outside the control of educational institutions that seems to be dominating. What perhaps educational institutions could do now is to help“brand” the Ghanaian Construction Philosophy. The question is, what really is the strength of the Ghanaian Construction Industry which can be enhanced and marketed as an international brand? Backed by innovation and R &D, it is high time that such a philosophy is strongly enshrined in the Ghanaian construction culture towards moving local construction capacity to a level of excellence. As it is now, it appears that the industry exists only as a replica of foreign architecture lacking originality of content precisely because R & D is yet to be critically advanced and embedded. Indeed, despite many of years construction education and practice, what constitutes local exceptional performance in the Ghanaian industry is yet to be fully explored and marketed as a brand, especially with respect contractor performance. No doubt, all stakeholders have a role to play in this agenda, yet it is also very clear that in an economy like Ghana which be default is so much dependent on Government a strong leadership in ensuring the implementation of policy-guidelines is the major driving force to engender the way forward.

Really, given that the construction industry has been used as the engine of growth in many modern societies the lack of robust policy agenda in addressing professionalisms and innovations could be disastrous. Presently, a few contractors from the developed economies dominate the international construction market. However, some developing countries that were in similar situations to Ghana at independence have been able to transform their industries not only to be competitive but also have penetrated the international market. To mention but a few are Malaysia, India, Egypt, South Korea, Brazil and China. It is therefore not beyond the capacity of Ghana with its acclaimed human resource base to strategise towards this realization. This demands commitment in following a thoroughly rigorous construction industry development agenda rather than the ad-hoc nature that has been followed till presently. Since the era of the CPP Government when they spearheaded a clear-cut policy direction of introducing local capacity to compete with foreign domination on the Ghanaian market, there is currently no clear cut policy guideline on what the Ghanaian Construction Industry really stands for and its future direction in the global market. If it is accepted that the potential growth of the country is intrinsically linked to the growth of the construction industry, then it is high time pragmatic measures are put in place for the way forward. Next, the structure of the GCI would be discussed.