More professional Singapore contractors seek niche abroad
More professional Singapore contractors seek niche abroad
By Leu Siew Ying
SINGAPORE (AFP): As Singapore's skyline changed over the past decade, so has the image of its builders who are moving off the tiny island to stake their claim to construction work abroad.
Where once local projects helped create a breed of self-made contractors who flaunted gold Rolex watches and drove Mercedes Benzs, the expansionist path overseas has nurtured a new class of builders, many university graduates.
"Nowadays, most people in my council are not owners or shareholders of companies but professionals," said Kong Mun Kwong, president of the Singapore Contractors Association.
Kong said the association's council is dominated by nuclear engineers, aeronautical engineers, MBAs and PhDs," adding: "And there are now all sorts of cars parked outside."
Contractors, who hired the best brains to make up for a lack of brawn, now find it necessary to look for jobs overseas to keep their experts employed as local opportunities shrink.
"We are the largest employer of graduates. So if we don't go regional we will be under-utilizing these people," Kong said. Going abroad also allows Singapore to sell its professional services.
"The Korean contractors bring along their laborers, we have no laborers to bring along, only our managerial talents," he said.
The smaller and fairly constant local construction pie is encouraging more firms to expand their business overseas, the Construction Industry Board (CIDB) said in a recent publication.
Local contracts fell to S$10.2 billion (US$ 6.49 million) last year after peaking at S$12.8 billion (US$ 8.15 million) in 1992, CIDB figures showed.
The value of overseas contracts won by Singapore companies, on the other hand, rose to S$ 1.6 billion in 1992 from S$ 118,000 in 1984, the government agency said.
The CIDB has forecast a further drop in the value of local contracts to S$ 9.6 billion this year because of an expected slowdown in private sector development.
Industry sources said the slowdown, made up in part by more public sector projects, reflects a glut in office space and the large number of residential projects in the pipeline.
Most of the surplus office space will not be absorbed until 1996, they said.
The CIDB said the number of local firms which have gone regional rose to 67 last year from 36 in 1986.
Singapore's construction industry made its first foray overseas in the early 1980s when the oil boom fueled a building frenzy in Middle-Eastern countries.
Supporting the overseas thrust, the CIDB recently launched a recruitment drive, seeking degree holders and promising them a 100-billion-dollar future at home and immeasurable potential in the Asia-Pacific region.
The Asian Development Bank has estimated that construction projects in Southeast Asia alone are worth US$ 50 billion a year, although analysts said much of the jobs are for construction of dams, power stations and roads.
Singapore contractors, however, have little experience in major civil engineering projects because there is little scope for such work locally, CIDB chief executive officer Lam Siew Wah said.
"They have the expertise for building high rise, hotels, housing and urban infrastructure but not dams. Realistically, we cannot be good in everything so we have to build niches," he said.
Recent jobs won by Singapore construction companies include a section of Taipei's mass transit railway, a road in Pakistan and a hangar superstructure and annex building in Brunei.