Publications
Partners
Johannesburg - The somewhat surprise move by the South African Reserve Bank (Sarb) to hike its repo rate by 50 basis points released nervous sentiment in the construction industry.
“In an instant, building owners would have to look at budgets in the wake of the knock-on effect this increase would have on the ability to tackle key maintenance projects,” said painting and construction company Indawo’s managing director, Geoffrey Jack.
“The pressure that this places on the industry can have far reaching consequences and construction companies are forced to come up with innovative solutions to maintain industry stability.”
Consumers will be hit hard as they are already struggling to come to terms with higher fuel prices, transport costs and general living expenses.
Communities rely on industry for survival and the latest increase in the key lending rate will be followed by an increase in the prime lending rate, further placing pressure on over-indebted individuals.
Labour intensive businesses, equally hit by the increase, have the added responsibility of ensuring the well being of their workforces and interest rate hikes do little to maintain their confidence.
“After the global recession, the industry has been on a shaky, but steady, path," said Jack.
"The announcement of an increase in the interest has come as a surprise, but perhaps not completely unexpected on the back of a falling rand and the challenges facing emerging markets."
He said South Africa, though, has proven to be resilient in tough economic times, through determination.
"It will again be the willingness of our workforces to engage with their employers to increase productivity that will maintain the stability we need heading into a relatively uncertain 2014,” he said.
The construction industry is one that bears the brunt of economic fluctuations but is also one that has proven to be resilient on the back of financial uncertainty.
"Should business owners and workforces rise up and follow the positive attitude proposed, we may just once again look back and surprise ourselves," said Jack.
“In an instant, building owners would have to look at budgets in the wake of the knock-on effect this increase would have on the ability to tackle key maintenance projects,” said painting and construction company Indawo’s managing director, Geoffrey Jack.
“The pressure that this places on the industry can have far reaching consequences and construction companies are forced to come up with innovative solutions to maintain industry stability.”
Consumers will be hit hard as they are already struggling to come to terms with higher fuel prices, transport costs and general living expenses.
Communities rely on industry for survival and the latest increase in the key lending rate will be followed by an increase in the prime lending rate, further placing pressure on over-indebted individuals.
Labour intensive businesses, equally hit by the increase, have the added responsibility of ensuring the well being of their workforces and interest rate hikes do little to maintain their confidence.
“After the global recession, the industry has been on a shaky, but steady, path," said Jack.
"The announcement of an increase in the interest has come as a surprise, but perhaps not completely unexpected on the back of a falling rand and the challenges facing emerging markets."
He said South Africa, though, has proven to be resilient in tough economic times, through determination.
"It will again be the willingness of our workforces to engage with their employers to increase productivity that will maintain the stability we need heading into a relatively uncertain 2014,” he said.
The construction industry is one that bears the brunt of economic fluctuations but is also one that has proven to be resilient on the back of financial uncertainty.
"Should business owners and workforces rise up and follow the positive attitude proposed, we may just once again look back and surprise ourselves," said Jack.
