15% surge expected in construction 

Economy January 25, 2017 01:00

By  SASITHORN ONGDEE
THE NATION

THE CONSTRUCTION market looks set to surge by more than 15 per cent to Bt1.2 trillion this year in the fastest expansion since 1993, the year, supported by the government’s spending on infrastructure.



 

Nattaphorn Bhromsuthi, vice president of the Thai Contractors Association, said yesterday that 2017 “will be a vigorous year for the construction industry ... This year is considered as the beginning of an uptrend in the industry ... But we have no idea how long the rising cycle will be.” 

Growth averaged about 10 per cent annually over the past four years, he said. 

Asean is likely in need of about US$60 billion (Bt2.1 trillion) a year until 2022 to serve its demand for infrastructure, according to KPMG research. 

As chairman of the Asean Construction Federation, Nattaphorn said Thailand was expected to be the largest market in the region, accounting for about $30 billion to $35 billion. 

Some others are Malaysia with $25 billion to $30 billion, Singapore with $18 billion to $25 billion and Myanmar and Cambodia with $6 billion to $8 billion each.

However, domestic construction work now is mainly concentrated in horizontal infrastructure projects such as roads, railways and bridges, rather than vertical projects like buildings. 

Thailand should apply high-tech equipment related to construction like Malaysia to improve the productivity of and reduce the time for construction, he said. 

With the use of advanced technologies, Singapore alone, with a population of less than 1 per cent of Asean’s 630 million people, can contribute as much as 13 per cent of Asean’s gross domestic product of $2.4 trillion. 

Thailand and Malaysia, with a combined population of 15 per cent, contribute 29 per cent.

Malaysia’s government has given importance to the use of state-of-the-art technologies and equipment in construction, he said. 

Thanat Veserachannond, secretary-general of the association, said Thailand had been trying to chase rich countries by using more high technologies in construction, but Thai authorities were prone to not supporting the use of high tech. 

In fact, using high tech in construction is typically costly. 

Yanyong Nitisaroj, deputy managing director for commercial affairs at Sino-Thai Intertrade Co, a trading arm of Sino-Thai Engineering and Construction, said the company focused more on selling fully automatic equipment in a bid to help move up the completion of construction.

Martin Sommer, district manager of JCB Southeast Asia, the regional arm of the world’s third-largest construction-equipment company, said it would mainly focus on the Thai construction market, expecting to expand its footprint in the construction-equipment market in Asean. 

Last year, the company posted a 3.4-per-cent share in Asean and 3.5 per cent in Thailand.

Danilo Catalucci, marketing manager for Southeast Asian and Japan at CNH Industrial Services (Thailand), said high-tech equipment and machines would help complete projects on time. 

The company expects to use Thailand as a springboard to Asean and continue substantial growth this year after succeeding in expanding by double digits last year.

“We want to establish the company as a key player in Southeast Asia,” he said.

Bangkok will host “Intermat Asean”, the Southeast Asian trade show for construction and infrastructure, from June 8-10. 

The association will ask the government to relieve the suffering of contractors in the severely flooded southern provinces, Nattaphorn said.