CCI mulls export of construction related professional services

by Gamini Warushamana

The Chamber of Construction Industry (CCI) in exploring the possibility of exporting construction related professional services and contracting capacities in the Middle East.

CCI President, Surath Wickramasinghe said the first trade mission facilitated by CCI from November 2-5 to Qatar was highly successful in securing business leads. Thirty-three delegates representing 23 companies in the construction and the related industries participated in this mission led by Minister of Export Promotion and International Trade Prof. G. L. Pieris.

Every member of the delegation succeeded in securing business leads. To convert such business leads to confirmed orders CCI will set up a liaison office in Qatar. The office will provide professional service and guidance as regards issues of commercial licences, business registration and facilitation of visas and for compliance with statutory requirements, Wickramasinghe said.

CCI said that there is a big downturn in the construction industry in Sri Lanka in the past 12 months and there is a cutback in real estate and construction activities. Developers and house-builders cannot bear the existing high interest rates. The cost of construction too is also increasing at 1.5-2% per month.

The rising cost of construction is associated with high demand for building materials as a result of the construction boom in China, India and the Middle East. Construction work related to the 2008 Olympic Games in China absorbs resources. The Indian economy is growing at 10% and the construction boom in India continues.

The construction industry in Dubai, Qatar and Abu Dhabi is also booming. Qatar is getting ready to host the Olympic games.

They have a target to build 50,000 hotel rooms and make the city a financial hub by bringing major financial corporations to Qatar. CCI plans to exploit the Middle East market by exporting professional services and securing construction contracts. Today there are a large number of Sri Lankan professionals and skilled labourers working in the Middle East.

According to estimates there are over 650 Quantity Surveyors (QS) in Dubai, over 170 (QS) in Qatar and around 400 architects in Oman and the UAE. Sri Lankan technical workers are also sought after in these countries. CCI convinced the Minister of Export Promotion and the Minister of Construction and Engineering Service that the best way forward is to get a large share of the construction industry in this part of the world against supplying labour.

During the visit the CCI signed an MoU with the Qatar Chamber of Commerce and Industry. Sri Lankan companies will start joint ventures with foreign counterparts and obtain sub contracts in major projects in the future. CCI estimates Rs. 2 billion in foreign remittances as revenue during the first year from professional service exports and construction contracts.

CCI seeks government assistance to make this plan a reality. We want the government to kick start the program. We need some mobilisation capital and are seeking similar support given to the apparel industry at the beginning.

Liberalisation of certain capital account transactions by amending Section 17 of the Exchange Control Act is also needed. We also expect tax concessions for a short period, Secretary General, CCI Dakshitha Thalgodapitiya said.

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