Can SA’s construction industry be saved?
President Cyril Ramaphosa’s plan to spend R100bn on infrastructure over the next decade is a sign that the government recognises just how precarious the construction industry is right now. Just two weeks ago, Group Five CEO Themba Mosai quit, as other firms tumble into business rescue. Is it time for investors to abandon the long-promised rebirth of the construction sector?
If you’re driving near Fourways in Joburg, travelling north along William Nicol Drive, the road turns to gravel before coming to a dead end. To keep going, you have to make a winding detour through Steyn City. It’s a source of deep frustration for motorists who commute to work in Fourways, Randburg and Sandton along that route — and it’s a deep disruption to companies in the area. The reason: the project to upgrade the road, the K46 which goes through Diepsloot to the N14 freeway, lies incomplete and abandoned — an emblem of a stalled economy and a flailing construction industry. The contractor, Lubbe Construction — which in better days described itself as "the biggest integrated construction development & management, infrastructure & property development company in SA" — has applied for business rescue, having missed successive deadlines to complete the project. Lubbe blames this on "financial difficulties". According to Lubbe’s contract with the Gauteng department of roads & trans...