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Maintenance
Private sector
Economic
10
development. As such, the industry is required for national development. It has been
argued that for a country to have meaningful and sustained development, it urgently
requires that it indigenize its construction industry, because if the construction
industry is inefcient, it will be difcult for such a country to attain meaningful
development.
Among the major economic sectors, the importance of the construction industry
is unique regardless of whether the country is underdeveloped, developing or
developed. For instance, the construction industry is subjected to quarterly and
annual statements of national accounts. The construction industry appears more
than once in the national accounts: GDP, GNI and GFCF. The outputs are measured
by gross output, capital formation and added value. More than half of GFCF
consists of construction outputs. The homes, ofces, roads, factories, and shopping
malls are all part of the outputs of the construction industry, among other capital or
investment goods.
The following are some major uses of the construction industry:
11
Table 2.1 Percentage share of GDP for selected countries (production approach) for construction
sector
Country
2005
2006
2007
2008
South Korea
5.7
5.5
5.3
5.0
Hong Kong
3.4
2.9
2.7
2.9
Taiwan
2.8
2.7
2.6
2.4
Singapore
n.a
n.a
3.0
3.6
Thailand
2.4
2.4
2.4
2.2
Philippines
4.4
4.6
5.0
5.1
Indonesia
5.9
6.1
6.2
6.3
Malaysia
3.0
2.9
2.9
2.8
Source Department of Statistics Malaysia (2014a)
2009
5.1
2.7
2.3
4.2
2.2
5.4
6.4
3.1
2010
4.6
2.9
2.3
3.8
2.2
5.7
6.5
3.2
2011
4.2
3.3
2.3
3.8
2.1
5.0
6.5
3.2
2012
4.1
3.5
2.2
4.0
2.1
5.4
6.5
3.5
2013
4.1
3.5
2.2
4.1
2.1
5.6
6.6
3.8
Table 2.2 is the contribution of the different industries to the GDP. The services
industry is the largest in terms of size while construction is the smallest. However, it
may be seen that the contributions of the construction industry is consistent and
impressive. As Table 2.3 suggests for the period indicated, the construction starts
with a moderate contribution but lags until 2008 contributing only 2.7 %. However,
from 2009 until 2013, the contributions of the construction industry are on the
increase. In fact, while the contributions of other major sectors plummet, that of the
construction industry is increasing.
In 2013, Malaysias economy grew at 4.7 % with the all sectors registering
positive growth (Table 2.4). The Services and Manufacturing sectors remained the
key engine in terms of supply. Consecutively, the Construction sector continued a
double-digit growth by registering 18.6 %. The growth is mainly accountable by the
strong growth in the residential sector (Table 2.5) coupled with the underlying
strength in infrastructure and civil engineering projects. The Malaysian construction
industry is classied into four sectors namely, residential buildings, none-residential
buildings, civil engineering and the special trade sectors. The residential sector
involves the construction of houses and condominiums. The non-residential construction comprises of all building construction other than residential. These include
the construction of commercial and industrial buildings. Civil engineering pertains
to the construction of public infrastructure such as bridges and highways.
The contributions of the residential sector have remained consistent from 2008 to
2013 (Table 2.5). However, the share of the non-residential sectors fluctuates
through the period and peaked in 2010, at 44.6 %. Similar scenarios play for the
other sectors. Value for construction work done includes for new work, conversions
and maintenance which were carried out during the reference period. The value of
the work completed in the rst quarter of 2014 by the types of clients is contained in
Table 2.6. In terms of construction activity by project owner, the private sector
continued to dominate. The private client dominates in all the four sectors, except in
civil engineering in which the private sectors contributed a little less than 50 %.
The increase in the shares of the private sector in 2013 as compared to 2008 is
remarkable (Table 2.6). As is the case in the rst quarter of 2014, from 2008 to
44,912
47,533
72,111
71,276
149,754
160,880
16,107
16,022
254,322
272,555
6,372
5,671
543,578
573,936
Malaysia (2014a)
Agriculture
Mining and quarrying
Manufacturing
Construction
Services
Plus import duties
GDP at purchasers prices
Source Department of Statistics
2006
2005
Country
48,188
72,758
165,879
17,391
299,933
5,937
610,087
2007
50,036
70,996
167,148
18,151
325,712
7,523
639,565
2008
Table 2.2 GDP by kind of economic activity at constant 2005 pricesRM million
50,063
66,386
152,150
19,270
335,027
6,898
629,885
2009
51,263
66,182
170,261
21,459
359,829
7,660
676,653
2010
54,250
62,607
178,237
22,464
385,550
8,653
711,760
2011
54,963
63,243
186,748
26,640
410,339
10,001
751,934
2012
56,095
63,680
193,237
29,554
434,460
10,586
787,611
2013
12
2 An Overview of the Construction Industry
2007
7.9
11.9
27.2
2.9
49.2
1.0
100.0
2006
2005
Agriculture
8.3
8.3
Mining and quarrying
13.3
12.4
Manufacturing
27.5
28.0
Construction
3.0
2.8
Services
46.8
47.5
Plus import duties
1.2
1.0
GDP at purchasers prices
100.0
100.0
Source Department of Statistics Malaysia (2014a)
Country
7.8
11.1
26.1
2.7
50.9
1.2
100.0
2008
7.9
10.5
24.2
3.1
53.2
1.1
100.0
2009
Table 2.3 GDP by kind of economic activity at constant 2005 pricespercentage share to GDP
7.6
9.8
25.2
3.2
53.2
1.1
100.0
2010
7.6
8.8
25.0
3.2
54.2
1.2
100.0
2011
7.3
8.4
24.8
3.5
54.6
1.3
100.0
2012
7.1
8.1
24.5
3.8
55.2
1.3
100.0
2013
14
Table 2.4 GDP by kind of economic activity at constant 2005 pricesannual percentage change
Year
Agriculture
Manufacturing
2006
5.8
1.2
2007
1.4
2.1
2008
3.8
2.4
2009
0.1
6.5
2010
2.4
0.3
2011
5.8
5.4
2012
1.3
1
2013
2.1
0.7
Source Department of Statistics Malaysia (2014a)
Construction
Services
GDP
0.5
8.5
4.4
6.2
11.4
4.7
18.6
10.9
7.2
10
8.6
2.9
7.4
7.1
6.4
5.9
5.6
6.3
4.8
1.5
7.4
5.2
5.6
4.7
Table 2.5 Value of construction work done by type of construction activity and project owner,
Q1 2014 (RM 000)
Types of construction
Private
Government
Residential buildings
6,709,282
252,330
Non-residential buildings
6,471,322
1,122,923
Civil engineering
3,880,379
2,024,227
Special trades
1,057,150
147,728
Total
18,118,133
3,547,209
Source Department of Statistics Malaysia (2014b)
Public corporation
240,213
458,106
2,494,848
114,830
3,307,997
Total
7,201,826
8,052,351
8,399,455
1,319,708
24,973,339
2013, the industry is led by the private sector. The expansion of private investment
from 2008 to 2013 was almost 100 % overall and in all the sectors except in the
special trade where expansion was less than 50 %. Whether we consider the sectorial construction individually of the industry as a unit during the period, the
private sector is the dominant investor in the industry. This nding is contrary to the
normal practice in which the public or government is the major client. In most
developing countries, at all levels the government is the major client. The investments of the private sector in the special trade are the least, being only 5 % in
2013. However, private investors are making massive investments both in the
residential and the non-residential sectors.
For the government and public organisations, their investments tend towards the
civil engineering sector. In comparison, both public corporations and government are
investing an approximate 5 % in the residential sector, but government investment in
non-residential buildings is quite high. The number of projects completed in the year
cited is contained in Table 2.7. Except in 2009, the number of projects increased. This
scenario will likely remain high as the government has outlined a number of ambitious packages to spur the construction industry, as Malaysia advances towards its
2020 target.
Among the major economic sectors, the contribution of the construction sector as a
source of employment is high. For instance, in 2012, the industry directly employed
approximately 1,028,000 (Table 2.8) people. This represents an estimated 8 % of the
15
Table 2.6 Value of construction work done by type of construction activity and project owners,
20082014 (RM 000)
Year
Residential
buildings
Non-residential
buildings
Private
2013
23,581,037
22,618,949
2012
19,624,697
19,386,220
2011
14,747,483
14,544,468
2010
10,631,163
12,021,759
2009
11,016,286
11,099,674
2008
12,957,437
10,963,133
Public corporation
2013
520,776
1,525,073
2012
119,187
757,191
2011
94,210
552,864
2010
130,325
333,182
2009
240,565
270,923
2008
274,021
245,545
Government
2013
861,413
5,159,365
2012
1,123,984
7,344,173
2011
1,214,648
10,119,190
2010
1,546,864
14,736,495
2009
1,840,696
12,949,060
2008
2,228,587
9,091,469
Source Department of Statistics Malaysia (2014b)
Civil
engineering
Special
trades
Total
13,827,222
10,948,244
7,768,191
4,640,156
4,850,657
6,076,449
3,172,017
3,062,682
3,309,319
3,181,929
3,034,121
2,666,011
63,199,226
53,021,843
40,369,461
30,475,007
30,000,738
32,663,030
8,873,459
6,416,175
1,123,505
1,182,226
1,264,874
1,027,422
459,460
254,724
482,609
803,099
794,811
289,651
11,378,768
7,541,277
2,253,187
2,448,833
2,571,173
1,836,639
9,600,307
10,839,606
9,412,826
9,921,018
11,090,137
11,068,873
675,825
795,947
889,029
1,664,025
1,562,992
1,431,549
16,296,910
20,103,710
21,635,694
27,868,401
27,442,885
23,820,478
2013
2012
2011
Number of project
37,516
35,589
32,454
Source Department of Statistics Malaysia (2014b)
2010
2009
2008
31,018
28,814
31,719
total employed workforce. The construction industry is the fourth employer of labour
after agriculture, manufacturing, and services. However, based on estimates by the
Department of Statistics, the construction industry was postulated to employ
approximately 765,000 people in 2010. In fact, the estimate assumed that until 2015,
the construction industry would not employ up to 800,000 people in a year. This
remarkable performance was mainly stimulated and sustained by the projects under
the second scal stimulus package such as the upgrading of roads, maintenance of
schools and government quarters and the allocation by the Ninth Malaysia Plan that
needed to be accelerated before the end of 2010. The projects under the Ninth
Malaysia Plan were double tracking rails, Penangs Second Bridge, KLIA2, Mass
1963
1964
1965
1966
1967
1968
1969
1670
1971
Number
47,799
48,014
51,056
60,162
45,383
44,231
51,702
60,285
Year
1972
1973
1974
1975
1976
1977
1978
19790
1980
Number
71,614
80,135
101,679
106,812
109,190
140,622
150,004
142,012
Year
1981
1982
1983
1984
1985
1986
1987
1988
1989
Number
243,603
282,337
306,412
297,811
294,065
250,172
195,632
201,576
250,481
Year
1990
1991
1992
1993
1994
1995
1996
1997
1998
Number
305,547
362,748
425,285
447,177
507,516
533,500
627,369
551,866
Year
1999
2000
2001
2002
2003
2004
2005
2006
2007
Number
458,580
455,663
449,944
551,775
595,139
Year
2008
2009
2010
2011
2012
2013
2014
2015
2016
Number
602,694
974,488
1,027,900
Source Department of Statistics Malaysia Construction (2013a) (survey was not carried out for reference years 1980, 1997, 1999, 2001, 2003, 2006 and 2008.)
Year
16
2 An Overview of the Construction Industry
17
1200000
Number of person
1000000
800000
600000
400000
200000
0
1960
1970
1980
1990
2000
2010
2020
Period, in year
Fig. 2.1 Number of person engaged in the construction industry from 1964 to 2012. Source
Department of Statistics Malaysia 2014b (constructed by the authors)
18
Table 2.9 Number of establishments, gross outputs and employment size group 2012
Outputs size group
Establishment
Gross outputs
RM million
% share
RM billion
% share
Number
% share
110.1
17.1
8.3
49.5
35.1
100
15.5
7.6
45.0
31.9
1,027,900
238,398
87.651
446.272
255.609
100
23.2
8.5
43.4
24.9
Total
100
<5
85.9
5 to <10
5.4
10 to <100
8.1
100 and above
0.6
Department of Statistics Malaysia (2012a)
Employment
2005
2010
2012
54
35
19
551,755
10.9
5.5
91.3
59.4
31.9
974,488
19.8
14.5
110.1
73.1
37
1,027,900
22.4
14.1
19
1,20,000.00
1,00,000.00
80,000.00
60,000.00
New Projects
40,000.00
Maintenance
20,000.00
0.00
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
Fig. 2.2 Value added for construction works (RM million) Constructed based on data obtained
from CIDB Malaysia
to remain like this for some time, as massive infrastructural projects have been
unveiled to achieve the targeted developed nation status. However, the allocations
to the maintenance sector are grossly inadequate, and even if the expenditure for
maintenance is under reported, the government needs to invest in this sector as a
large number of constructed facilities require maintenance.
The spill over impact from the projects of the Economic Transformation
Programme (ETP), which started in 2010, was reflected in the performance of the
construction sector for the year 2012. The year 2012 was remarkable for the
industry, as the industry recorded highest growth and output of 18.5 % (Table 2.11)
This high growth is the highest since 1995 (21.1 %). Correspondently, the GDP
only grew at 5.6 % in 2012. The unprecedented expansion in the growth of the
construction industry is explained by the civil engineering and residential sectors
and reflects government efforts to expand and improve the roads and rail network,
improve electricity generation and increase oil and gas outputs. In 2012, the construction sector recorded a value of gross output of RM110.1 billion with the
Table 2.11 GDP by kind of economic activity at constant 2005 pricesannual percentage
change
Economic activity
2006
Agriculture
5.8
Mining and
1.2
quarrying
Manufacturing
7.4
Construction
0.5
Services
7.2
Import duties
11.0
GDP at purchasers
5.6
prices
Department of Statistics Malaysia
2007
2008
2009
2010
2011
2012
2013
1.4
2.1
3.8
2.4
0.1
6.5
2.4
0.3
5.8
5.4
1.3
1.0
2.1
0.7
3.1
8.5
10.0
4.7
8.3
0.8
4.4
8.6
26.7
4.8
9.0
6.2
2.9
7.1
1.5
11.9
11.4
7.4
9.6
7.4
4.7
4.7
7.1
13.0
5.2
4.8
18.6
6.4
15.6
5.6
3.5
10.9
5.9
5.8
4.7
(2014a)
20
intermediate input of RM73.1 billion. The value added was RM37.0 billion, while
the total number of workers involved totalled 1,027,900 persons with the total
salaries and wages paid at RM22.4 billion in 2012. Meanwhile, the value of xed
assets owned in 2012 were RM14.1 billion with the largest capital expenditure
contributed by the machinery and equipment amounting to 50 % of the total capital
expenditure during the reference year (Department of Statistics 2012a).
One of the prime movers of the SME is the construction industry. Construction
recorded a strong growth of 15.3 %, while SME grew at 6 % in 2012 (Table 2.12).
The construction industry contributed 2.8 % to the share of the SMEs. In 2012, the
share of SMEs value added to the construction sector was 25.9 %. The construction
industry maintains a consistent contribution to the SMEs (Table 2.13). This contribution is low, but with the nature of the construction industry is not surprising.
The contributions of women in the construction industry are small (Table 2.14).
This refers to the establishment wherein at least 51 % of the equity is held by
woman/women or the largest shareholder is a woman, or the establishment is run by
a woman, or the Managing Director or Chief Executive Ofcer is a woman who
owns at least 10 % of the equity. Women-owned establishments in the construction
sector accounted for 6.2 % and generated output of RM4.4 billion (4.8 %) of the
total sector in 2010. Approximately 54,000 persons were employed, with salaries
Table 2.12 Value added of smes by kind of economic activity at constant 2005 pricesannual
percentage change
Economic activity
2007
2008
2009
2010
2011
2012
Agriculture
8.3
3.3
Mining and Quarrying
4.9
12.7
Manufacturing
5.7
7.2
Construction
0.3
12.4
Services
6.8
12.6
Import duties
12.3
23
Total (SMEs expansion)
6.4
10
Department of Statistics Malaysia (2012b)
2006
2.3
1.6
0.7
2.5
9.8
68.1
6.5
1.2
1.8
7
6.9
2.6
11.7
0.2
5.9
3.5
11.2
16
7
48
8.3
6.2
5.5
7.6
4.6
6.8
33.1
7
1.9
14.6
6
15.3
5.9
29.6
6
Table 2.13 Value Added of SMEs by Kind of Economic Activity at Constant 2005 Prices
Percentage Share to GDP
Economic activity
Agriculture
Mining and
quarrying
Manufacturing
Construction
Services
Import duties
Total
Department of Statistics
2005
3.4
0.1
8.1
0.7
17
0.1
29.4
Malaysia
2006
2007
2008
2009
2011
2012
3.5
0.1
3.4
0.1
3.3
0.1
3.4
0.1
2010
3.4
0.1
3.4
0.1
3.3
0.1
8.1
8.2
0.7
0.7
17.2
18.2
0.1
0.1
29.7
30.7
(2012b)
7.8
0.7
19.1
0.2
31.2
7.4
0.8
19.9
0.2
31.8
7.7
0.8
19.8
0.2
32
7.9
0.8
20.1
0.3
32.6
7.9
0.9
20.2
0.4
32.8
21
Table 2.14 Key indicators of women owned establishment, in construction sector, 2010
Key Indicators
Total
construction
Establishments (number)
22,140
Value of gross outputs
91,3
(RM billion)
Value of intermediate inputs
59.3
(RM billion)
Value added (RM billion)
31.9
Total person engaged (number)
974,488
Salaries and wages (RM billon)
19.8
Value of xed assets (RM billion)
14.5
Department of Statistics Malaysia (2011)
Women-owned
establishment
%
share
1,371
4.4
6.2
4.8
2.8
4.7
1.5
53,816
0.9
0.6
4.7
5.5
4.5
4.1
and wages paid of RM0.9 billion (4.5 %). The value added to the xed assets
accumulated by this women-lead business was RM0.6 billion (4.1 %) in comparison to the total xed assets (RM14.5 billion) recorded during the census period.
The involvements of foreign contractors in the construction industry are minimal. In
2011 while only six government projects were undertaken by the foreign, 120 of the
private projects has foreign involvement. In terms of value, 10 % of the projects
awarded to foreign contractors are government while the remaining is from the
private sectors (Table 2.15). However, in 2012, the involvement of foreign contractors in has dropped signicantly. A similar situation is also experienced in 2013.
In fact, the government does not award any contract to the foreign contractors in
2013. Regardless of whether the contracts were awarded to local contractors or
foreign contractors, most of the works are awarded based on the traditional procurement method. For the last three years, more than 60 % of the contracts awarded
to the foreign contractors were for civil engineering, or electrical engineering or
mechanical engineering. The EPCC (engineering procurement construction and
commissioning) contracts are normally refers to oil & gas projects only. Under the
contract, the contractors designs the installation, procures the necessary materials
and build the projects.
99,461.61
91,442.74
4,251.60
3,502.31
41.11
223.85
123,600.42
113,004.77
6,778.39
3,052.90
505.71
258.65
92,304.06
76,063.25
7,605
7,324
159
99
5
18
7,650
7,217
247
114
42
30
5,985
5,717
2011
Conventional
Design and build
Turnkey
Built, operate and
transfer
Engineering, procurement, construction and
commissioning
2012
Conventional
Design and build
Turnkey
Built, operate and
transfer
Engineering, procurement, construction and
commissioning
2013
Conventional
Total
Number
of Projects
Type of Contract
1,481
1,377
1,940
1,785
103
38
8
1,905
1,805
64
34
19,915.09
14,466.88
74.86
18,116.04
14,373.44
2,767.27
867.67
32.80
6.60
21,408.19
19,429.96
1,670.79
300.84
Local Contractors
Government Projects
Number
Value
(RM M)
4,423
4,269
23
5,567
5,319
124
67
34
14
5,574
5,412
86
57
5
62,451.30
57,777.11
160.76
91,216.52
87,422.16
1,731.33
1,429.36
472.91
213.67
59,451.14
57,822.53
954.18
419.65
41.11
Private Project
Number
Value
(RM M)
0.00
144.86
144.86
1
1
1,610.74
627.49
983.25
6
5
1
Foreign Contractors
Government Projects
Number
Value
(RM M)
Table 2.15 Number and Value of Projects Awarded By Status of Contractors and Type of Contract as of December 2013
81
71
142
112
20
9
120
102
8
8
9,937.67
3,819.26
(continued)
23.03
14,123.00
11,064.31
2,279.79
755.87
3.58
16,991.54
13,562.76
643.38
2,781.82
Private Project
Number
Value
(RM M)
22
2 An Overview of the Construction Industry
Total
Number
of Projects
Type of Contract
77
18
6
3
470.90
14.36
2,807.54
2,615.88
10.43
18
74
47
15
438.65
1,105.20
3,053.77
76.57
Value
(RM M)
Number
Number
Number
Value
(RM M)
Government Projects
Government Projects
Value
(RM M)
Foreign Contractors
Private Project
Local Contractors
4,248.63
11,434.28
87.00
5
4
Number
17.89
335.89
5,764.63
Value
(RM M)
Private Project
236
7,358
4,719
2007
Building
1,712
Civil
engineering
170
3,736
Building
Mechanical
5,854
2006
Electrical
179
1,562
Civil
engineering
133
3,691
Building
Mechanical
5,565
2005
Electrical
132
1,312
Civil
engineering
112
3,325
Building
Mechanical
4,881
2004
Electrical
116
1,404
Civil
engineering
112
2,909
Building
Mechanical
4,541
2003
Electrical
Total
projects
Work
spsecialization
51,658.31
93,294.20
1,608
1,893.66
21,050.78
36,374.37
60,926.99
1,320.14
1,311.48
15,748.62
35,896.84
54,277.08
447.28
6,303.91
16,722.17
29,221.00
52,694.36
391.98
7,054.58
16,899.50
25,213.82
49,559.88
Total value
4,009
5,845
134
188
1,282
3,284
4,888
98
144
1,165
3,279
4,686
80
95
978
2,964
4,117
77
78
960
2,534
3,649
47,813.18
85,081.63
1,520.22
1,720.05
15,605.92
34,005.92
52,896.23
919.97
1,128.80
11,491.22
33,643.65
47,183.64
360.96
6,066.09
14,685.61
28,112.21
49,257.87
276.08
6,608.39
13,416.21
23,680.07
43,980.75
New projects
99
448
226
77
3,160
11
18
180
80
289
133
66
214
11
11
193
66
281
Upgrading
605.24
3,124.03
13.77
10.82
3,650.85
470.72
4,145.83
26.97
86.72
2,580.58
372.07
3,066.34
13.33
139.41
964.73
162.58
1,280.05
28.53
23.96
2,158.71
317.14
2,528.34
305
351
21
108
137
15
86
107
19
118
147
23
151
178
920.25
11.10
24.99
94.96
434.81
565.86
13.05
369.95
53.47
483.78
1,693.38
1,848.03
15.59
7.36
542.28
490.26
1,055.48
21.24
80.90
71.43
989.11
1,162.68
Expansion
27
183
15
33
57
20
125
10
50
20
89
13
19
73
20
125
13
21
121
17
172
272.87
1,138
25.64
114.54
226.42
576.30
972.90
335.09
8.74
374.11
147.11
865.90
42.05
36.02
406.01
224.80
708.85
40.81
48.18
653.68
138.85
881.52
Maintenance
60
268
114
61
188
142
66
216
102
45
155
10.
40
152
Repair
566.77
1,303.99
27.94
9.33
978.83
203.57
1,219.67
10.69
3.80
1,182.78
218.79
1,416.06
17.62
3.04
562.96
82.98
666.07
32.44
0.59
596.44
167.44
796.91
Table 2.16 Number and value of projects awarded by type of work and work specialization as of December 2006a, 2010b, 2013c
219
263
12
186
200
10
160
178
112
123
101
109
(continued)
706.54
798.23
5.02
1.57
46.61
583.48
636.88
6.18
2.52
48.50
525.26
582.46
2.25
1.36
7.88
204.17
215.66
1.047
3.51
20.99
426.54
452.11
Renovation
24
2 An Overview of the Construction Industry
335
7,605
4,797
2,162
2011
Building
Civil
Engineering
1,926
Civil
engineering
362
4,679
Building
Mechanical
7,302
2010
Electrical
342
1,926
Civil
engineering
213
4,558
Building
Mechanical
7,039
2009
Electrical
299
1,947
Civil
engineering
195
4,081
Building
Mechanical
6,522
2008
Electrical
269
220
Mechanical
2,150
Civil
engineering
Electrical
Total
projects
Work
spsecialization
24,224.89
60,621.39
99,461.30
6,279.84
6,971.15
16,652.15
61,105.35
91,008.49
5,231.52
2,865.24
18,358.93
48,457.95
74,913.63
2,925.18
3,003.60
24,770.75
55,137.55
85,837.08
2,771.27
1,807.08
37,057.53
Total value
1,513
4,169
6,160
252
240
1,294
4,044
5,830
153
243
1,213
3,381
4,990
113
201
1,284
3,277
4,875
163
210
1,463
17,662.78
57,412.56
88,888.50
5,799.51
6,556.80
13,402.49
57,034.82
82,793.62
4,930.08
2,604.55
14,604.18
42,618.48
64,757.29
2,609.18
2,634.45
19,448.75
48,432.11
73,124.48
2,522.24
1,637.34
33,108.88
New projects
335
139
515
33
23
336
107
499
19
21
379
307
726
23
36
311
195
565
17
11
321
Upgrading
3,528.84
747.59
4,706.21
147.29
68.09
2,070.61
778.62
3,064.61
139.50
56.00
1,995.32
1,865.07
4,055.88
119.40
225.72
2,720.80
2,344.49
5,410.41
68.03
20.98
2,429.77
19
139
177
27
232
271
35
516
563
10
35
237
287
33
5.67
5.91
143.08
1,375.03
970.39
2,394.39
47.54
13.89
99.01
1,772.04
1,932.47
13.00
33.07
347.34
2,465.83
2,859.23
25.11
34.09
960.73
2,606.83
3,628.76
Expansion
93
33
192
58
55
110
22
245
24
46
82
22
174
39
42
134
44
259
22
28
108
848.79
124.65
1,191.59
254.71
294.57
542.07
90.12
1,181.46
108.36
108.01
500.23
199.47
916.07
133.73
79.90
726.68
373.17
1,313.48
149.05
110.33
606.03
Maintenance
147
80
253
136
64
217
17
193
107
322
163
79
254
192
Repair
690.65
476.67
1,236.43
24.86
18.62
467.42
590.11
1,101.01
26.28
45.19
843.30
464.36
1,379.13
9.530
27.12
847.23
345.62
1,229.51
14.67
28.32
694.24
55
237
308
23
210
240
24
225
264
10
20
249
282
38
11.61
4.21
75.54
(continued)
118.79
889.54
1,044.49
5.95
19.19
70.55
839.64
935.33
14.30
18.42
68.56
844.74
946.02
28.24
2.32
1,033.32
1,033.32
1,130.44
Renovation
3,548
2,003
223
211
Building
Civil
Engineering
Electrical
Mechanical
6,921.70
5,357.65
19,108.00
60,916.69
92,304.04
6,238.45
8,950.20
38,020.56
70,391.20
123,600.41
6,092.53
8,522.79
Total value
5,985
2013
Civil
Engineering
327
2,149
Building
289
4,885
2012
Mechanical
7,650
Mechanical
Electrical
314
332
Electrical
Total
projects
Work
spsecialization
136
156
1,287
3,069
4,648
184
215
1,510
4,135
6,044
248
230
8,268.73
5,544.43
6,670.49
5,105.66
14,334.01
57,976.48
84,086.64
5,104.47
8,301.67
33,064.14
66,308.41
112,778.68
New projects
18
27
328
113
486
23
35
280
178
516
16
25
Upgrading
121.27
49.33
81.44
2,572.93
602.43
3,306.12
103.09
137.65
1,697.95
1,193.06
3,131.75
308.51
22
81
114
15
28
133
179
11
34.11
14.87
21.28
83.81
312.90
604.01
1,021.99
3.91
94.17
1,167.33
1,108.21
2,373.62
Expansion
41
18
118
12
189
41
44
152
90
327
38
28
125.27
40.48
848.08
56.79
1,070.62
274.54
372.91
1,204.11
431.99
2,283.55
149.71
68.44
Maintenance
213
86
317
25
11
139
72
247
10
16
Repair
20.59
43.23
33.31
805.75
466.92
1,349.21
580.39
23.15
697.45
324.85
1,625.84
48.52
35
187
231
13
40
277
337
12
9.65
26.51
12.10
12.95
234.35
1,210.06
1,469.45
172.04
20.65
189.60
1,024.68
1,406.96
Renovation
26
2 An Overview of the Construction Industry
27
You may wish to see the denition we provided for maintenance (see Sect. 3.2.4
page 43). But if for the purpose of argument and understanding, maintenance
includes the activities we just considered in the last sentence; maintenance is only
accountable to 8.5 % of the total expenditure. But if we are conservative, the
maintenance and repair are only considered, the amount is contribution is reduced to
2.96 % of the total investment in the construction industry. If we are more categorical, as the table indicates, the contribution of maintenance is reduced to a mere 1.
44 % of the total investment. In effect, the argument here is that there is insufcient
allocation or investment for maintenance. Whether one considers maintenance as 1.
44 %, 2.96 % or even the 8.5 %, the amount is inadequate in many respects. The
issue is that proper attention is not accorded to maintenance. In reality, the required
amount for maintenance should be more than 10 % of the total expenditure considering the annual contribution of new buildings to the exiting stocks.
We considered that the government is not doing enough in terms of allocation to
the maintenance sector. Most developed countries and some ambitious developing
countries have observed the roles of maintenance and now allocate roughly 50 % of
annual expenditure to the industry to the maintenance sector. It was also suggested
that about 5 % of the replacement values of the built assets is also applicable.
Table 2.17 presents the sectoral expenditure for maintenance. In terms of methods
of procurement or types of contract, the traditional method is the dominant in the
period selected for the different categories of works (Table 2.18).
832
Social
amenities
540
1,543
Non
residential
Social
amenities
Infrastructure
1,636
2,266
Residential
1,914
5,985
Social
amenities
2013
894
Non
residential
Infrastructure
2,206
2,636
Residential
1,950
2,566
Non
residential
7,650
2,257
Residential
2012
7605
2011
Infrastructure
Total number of
projects
Project
category/
Year
372
892
18,817.34
1,818
1,566
4,648
1,309
608
2,055
2,072
6,044
1,361
625
2,033
2,141
6,160
14,658.38
6,212.26
35,893.42
27,322.58
84,086.64
39,302.43
6,409.13
35,075.87
31,991.25
312
60
103
11
486
274
102
115
25
327
516
25,491.56
77
90
21
112,778.68
5,644.25
33,522.73
24,229.97
88,888.51
515
Upgrading
Number
Number
Value (RM
M)
New project
7,050.97
38,741.75
27,693.99
92,304.05
44,469.68
7,492.19
39,263.42
32,375.11
123,600.40
32,203.35
6,808.50
35,806.83
24,642.92
99,461.60
2,523.57
383.80
379.31
19.45
3,306.13
1,848.49
407.52
842.10
33.64
3,131.75
3,585.73
358.05
732.24
30.19
4,706.21
Value (RM
M)
27
18
56
13
114
31
39
98
11
179
25
44
96
12
177
Number
Expansion
267.89
116.88
597.85
39.37
1,021.99
1,277.90
186.53
834.13
75.05
2,373.61
1,511.09
419.49
410.72
53.09
2,394.39
Value (RM
M)
100
20
59
10
189
141
42
78
66
327
75
33
62
22
192
Number
609.68
44.10
308.05
108.79
1,070.62
1,314.29
160.66
675.69
132.91
2,283.55
849.56
104.11
177.30
60.61
1,191.58
Value (RM
M)
Maintenance
Table 2.17 Number and value of projects awarded by type of work and project category, 20112013
Repair
200
47
48
22
317
139
46
43
19
247
150
23
50
30
253
Number
698.79
225.69
265.41
159.32
1,349.21
642.88
178.69
700.43
103.85
1,625.85
727.36
216.64
185.69
106.74
1,236.43
Value (RM
M)
308
12
23
182
14
231
20
57
247
13
337
12
30
235
31
59.03
68.24
1,297.71
44.48
1,469.46
83.69
149.66
1,135.20
38.41
1,406.96
38.05
65.96
778.15
162.32
1,044.48
Value (RM
M)
Renovation
Number
28
2 An Overview of the Construction Industry
3,052.90
7,217
247
114
42
30
5,985
5,717
156
69
21
22
Turnkey
2013
Conventional
Turnkey
6,778.38
7,650
Conventional
470.90
87.00
11,434.28
4,248.62
76,063.24
92,304.04
258.66
505.71
113,004.76
123,600.41
223.85
41.12
3,502.31
2012
99
Turnkey
4,251.59
159
91,442.74
99,461.61
18
7,324
Conventional
7,605
2011
Total project
value (RM M)
Total number of
projects
Type of contract
19
14
54
109
4,452
4,648
21
31
94
180
5,718
6,044
10
80
114
5,953
6,160
455.40
75.19
11,314.74
3,825.58
16
463
486
84,086.64
68,415.73
10
25
174.44
459.04
2,868.67
6,318.54
476
516
112,778.68
102,957.99
15
491
112.48
29.04
2,672.24
3,543.54
82,531.20
88,888.50
515
Upgrading
Number
Number
Value (RM
M)
New project
0.76
3.32
76.03
126.46
3,099.55
3,306.12
10.06
1.99
85.10
194.88
2,839.73
3,132
85.44
0.68
27.09
327.03
4,265.97
4,706.21
Value
(RM M)
26.10
88.07
907.82
103
1,021.99
114
21.70
85.34
41.68
2,224.90
14
158
2,373.62
179
675.50
294.07
1,424.81
2,394.38
Value
(RM M)
165
177
Number
Expansion
14.74
1.26
10.17
1,044.45
1,070.62
72.66
183
189
9.92
2,200.97
2,283.55
2.16
4.60
14.45
1,170.39
1,191.60
Value
(RM M)
320
327
187
192
Number
Maintenance
Table 2.18 Number and value of projects awarded by type of work and type of contract as of December 2013
Repair
17
296
317
234
247
240
253
Number
4.66
8.66
170.85
1,165.04
1,349.21
12.42
12.64
110.22
1,490.55
1,625.83
16.78
119.93
42.69
1,057.03
1,236.43
Value
(RM M)
220
231
22
311
337
14
288
308
2.57
8.75
27.49
1,430.65
1,469.46
1.50
0.64
1.15
113.06
1,290.62
1,406.97
6.99
11.40
2.95
29.81
993.34
1,044.49
Value
(RM M)
Renovation
Number
30
31
disputes are also on the rise. There are also problems relating to labour. There is a
lack of competent labour to meet the demands of the industry. While we are of the
understanding that for a country to have meaningful and sustained development, it
must indigenize its construction industry, but to increase healthy competition in the
construction, foreign involvement is encouraged. Local contractors should form
alliance or joint venture with some foreign construction companies to deliver some
the projects. There are some advantages with the involvement of foreign collaborations like project nancing and knowledge transfer. In addition, more investment
is required from both the private and public sector for research and development
(R&D), and more funds and required from banks and other nancial institutions.
The contributions of the industry to the GDP and GNI at around 3 % are comparatively low. A signicant improvement is required to increase the contributions
of the industry. Proactive methods are required in disposal of waste. The Malaysian
construction industry is synonymous to waste generator and the situation is further
worsening and complex due to lack of suitable landlls. The waste that the industry
produces create avenue to the some stakeholders (NGO, environment etc.) to see
the industry as major cause of pollution. While the large construction business has
good waste disposal programme the small and medium classes do not. However,
dumping the waste into dump sites is not an adequate way to waste management.
We suggest change in attitudes of the stakeholders. Emphasis should be given to
waste minimisation and where possible waste avoidance over waste disposal no
matter how effective this could be. The attitudes of the industry toward waste
management are mainly to meet regulatory requirements. The industry should
educate the clients on reuse and recycle of waste materials and components. The
government efforts towards climate change and green technology also pose greater
challenges to the construction industry as the have signicant impacts on how the
constrction industry designs and constructs constructed facilities. To address
the problems pose by the climate change /gboabl warming, Malaysia as adopted the
Low Carbon Cities Concept (LCCC). Earlier on, a Low Carbon Cities Framework
(LCCF) was formulated through governments collaborations to serve as guide for
stakeholders including developers, contractors, designers local councils and town
planners to reduce the levels of carbon emission in cities.
References
Construction Industry Development Board (CIDB) Malaysia. (2006). Construction statistics
quarterly bulletin number and value of projects awarded by type of work and work
specialisation, 20032005. https://www.cidb.gov.my/cidbweb/images/pdf/buletin/2006/B2_
Q4_06.pdff.
Construction Industry Development Board (CIDB) Malaysia. (2009). Construction statistics
quarterly bulletin. Number and value of projects awarded by type of work and work
specialisation as of December 2009 (Table 2.17). Accessed on July 2013 from https://www.
cidb.gov.my/cidbweb/images/pdf/buletin/2009/B2_Q4_09.pdf.
32
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