Published on January 10, 2005

But SMEs must get fair slice: experts

Six bumper years lie ahead for the construction industry and property developers due to mega-infrastructure projects worth up to Bt500 billion – provided the government separates the projects to support small and medium enterprises, according to industry experts.

Kumropluk Suraswadi, the director-general of the Office of Transport and Traffic Policy and Planning, said property developers and construction firms would benefit from the mass-transit system extensions, not least because there will be plenty of opportunities for shrewd investors all along the planned routes.

Construction firms also benefit directly from the mega-projects if they take part in the bidding, he added.

“We believe the mega-projects will generate income for related businesses and also create jobs,” he added.

Land developer Property Perfect’s managing director Chainid Ngow-Sirimanee agreed, saying that land prices around mass-transit projects had doubled since the projects were announced.

“We have been lucky because our projects are located close to the mass-transit system,” he added.

However, Bundhit Katanyutanon, a director at the Thai Constructors Association, warned that small and medium construction firms were unlikely to benefit from the projects because they lack the capital to compete with big businesses.

“If the government wants to create jobs and distribute wealth for local firms through the mega-projects, it will have to split them into several smaller contracts,” Bundhit added.

Kumropluk said the government would do just that.

Meanwhile, the government must tackle a shortage of labour and construction materials, said Totrakul Yomnak, director of the Engineering Institute of Thailand.

The material shortage is mainly due to a surge in demand caused by the growth of China’s economy and its preparations for hosting the 2008 Olympics.

“If the government does not have a good construction plan, the country will face higher construction prices that will drive the cost of the mega-projects way beyond the estimate,” Totrakul said.

Prices of a number of construction materials are expected to soar 50 per cent above 2003 levels following global demand, especially in China.

Somluck Srimalee

The Nation

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