Record $5b earnings for Mice - Singapore

Record $5b earnings for Mice - Singapore

Singapore also ranked top city for business meetings, conventions

By Jessica Cheam

Mr Anthony Chong’s Kingsmen Exhibits wins the service excellence award for the second year.

THEY are the mice that roared.
Business travel and events earned over $5 billion for Singapore last year - a new record for the so-called Mice sector.

The industry - meetings, incentive travel, conventions and exhibitions (Mice) - grew by $1 billion in just a year, topping the $4 billion it reaped in 2006.

Unveiling fresh figures for 2007, Senior Minister of State for Trade and Industry S. Iswaran said yesterday that business travel and Mice visitors accounted for almost three million visitor arrivals and 40 per cent of total tourism receipts.

For the first time, Singapore was ranked as the top international meeting city in the world, over old favourites such as Paris and Vienna, by the Union of International Associations.

This was the ‘icing on the cake that capped an outstanding year’, said Mr Iswaran at the Singapore Business Events awards last night at Shangri-La Hotel.

Even as he congratulated industry players for this achievement, Mr Iswaran acknowledged the current heightened uncertainty in the global economy and financial markets.

He cited recent figures by the International Monetary Fund, which projected the moderation of global growth from 5 per cent in 2007, to 4.1 per cent this year and 3.9 per cent next year.

Against this backdrop, the international travel industry is expected to slow down, and the industry will face challenges in the coming months, he said.

But the Singapore Tourism Board and industry partners ’still see good potential’ in future business events beyond 2010, he added.

By 2010, Singapore will be hosting the world’s first summer Youth Olympic Games, and the Republic’s two integrated resorts would have opened, along with the new Marina Bay Financial Centre.

The president of the Singapore Association of Convention and Exhibition Organisers and Suppliers, Mr Edward Liu, told The Straits Times that Singapore has been ‘pro-active in bringing in world-class events’ such as Formula One and the Youth Olympics.

‘These events will generate a lot more tourism arrivals and receipts to compensate for any slowdown of visitor numbers,’ he said.

He added that the latest figures show that the Mice industry is on track to achieve its target of contributing $10.5 billion to the economy by 2015 as outlined in the Tourism 2015 blueprint.

The greatest challenge for the industry now is ‘going out there to bring back past trade shows and woo more mega events’, said Mr Liu.

Plans to upgrade Singapore Expo’s facilities were also announced by Mr Iswaran last night. A suite of meeting rooms over two floors will be added to the Expo, and improvements will be made to the venue’s technical and audio-visual capabilities. Its facade, landscaping and lighting will also be enhanced.

Last night’s awards, in their second year, honoured industry players from venues to event organisers. The winners were selected by a panel of 21 judges and assessed on their ability to deliver world-

class events and how they helped raise Singapore’s profile as a Mice destination.

Design and production firm Kingsmen Exhibits won the Service Partner Excellence Award for the second year running. Its executive director, Mr Anthony Chong, said the award ’serves as a reaffirmation that we are on the right track’.

One individual honour - Business Event Ambassador - was given to Professor Feng Pao Hsii, adjunct professor of medicine at the National University of Singapore’s Yong Loo Lin School of Medicine. He was elected chairman of the National Arthritis Foundation in 1997 and has been organising medical conferences in Singapore for the last 30 years.

‘As a Mice hub, Singapore still has some way to go but if we work together, we are confident of reaching our goal,’ said Prof Feng yesterday.

Despite short-term challenges, significant opportunities lie ahead, added Mr Iswaran. He said: ‘We are committed to a productive public-private engagement

…to maintain Singapore’s pre-eminent global position in this industry.’

Source : Straits Times - 03 Sept 2008

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Tourism will pick up by 2010 - Singapore

Tourism will pick up by 2010 - Singapore

Opening of integrated resorts and Gardens by the Bay will give boost

By Lim Wei Chean

STB chief Lim Neo Chian, who said last week that he was stepping down, feels that the goal to draw 17 million visitors to spend $30 billion by 2015 is still attainable. — ST PHOTO: LIM WUI LIANG

FEWER tourists may be coming but Singapore’s outgoing tourism chief is confident that things can turn around by 2010.
From Mr Lim Neo Chian’s point of view, the opening then of the two integrated resorts (IRs) in Marina Bay and Sentosa, as well as the Gardens by the Bay in Marina South, will be a fillip for the industry.

Tourist arrivals for the first six months of this year were lower than the figure for the same period last year, putting into doubt whether this year’s target of 10.8 million visitors can be met.

There was also a 0.2 per cent drop in spending by visitors in the first half of this year compared to the same period last year.

‘I think what is important is to ask if the slowdown is the result of us losing our competitiveness or our destination appeal,’ said Mr Lim, 56, of the industry which employs some 150,000 people.

His own assessment is that the drop in numbers is a result of the current global slowdown.

He added: ‘All our key markets are facing economic problems, high inflation, slowdown in growth and financial uncertainties in the outlook going forward.’

He is ‘not too worried’ as it is a ’short-term’ problem.

While the impact will be felt this year and may spill over to next year, he said the goal to draw 17 million visitors to spend $30 billion by 2015 - first announced in 2005 - is still attainable.

Mr Lim, who said last week that he was stepping down, also spoke about his six-year tenure at the Singapore Tourism Board (STB).

Three occasions stood out as most memorable for him:

May 31, 2003, when the World Health Organisation declared Singapore free of severe acute respiratory syndrome (Sars);

May 26, 2006, when the Marina Bay integrated resort was awarded to Las Vegas Sands after a ‘robust and transparent’ process; and

May 11 last year, when Singapore won the rights to host a Formula One race.

There were challenges, of course, such as Sars, which saw tourism grinding to a halt. Still, he viewed that as a blessing in disguise as it allowed him, as the new STB chief then, to rally industry players to focus on longer-term plans.

He noted that it also made the Government realise how important tourism is. ‘It was very clear during the Sars period when tourists stopped coming and people stopped spending. The city, in many areas, came to a standstill.’

That, to some extent, helped him secure the support to work out a road map to take the industry to the next level.

Successes along the way included the International Monetary Fund and World Bank meetings here in 2006.

But he said that it is time to make way for new blood after spending six years at the helm.

‘This is the longest appointment I have ever held,’ he noted, adding that his previous stints as Chief of Army, chief of JTC and head of Suzhou Industrial Park were three years each.

Ms Aw Kah Peng, assistant managing director of industry at the Economic Development Board, will succeed him.

He is looking for another job that will give him time to spend with his family, play golf and travel for leisure.

He and his homemaker wife have three children.

‘If something interesting comes along, I will be prepared to take on new challenges. I am a little too young to retire,’ he said.

Source : Straits Times - 03 Sept 2008

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Platform doors for elevated Singapore MRT stations

Platform doors for elevated Singapore MRT stations

THE Land Transport Authority (LTA) will spend more than $126 million to install platform screen doors at elevated MRT stations to prevent track intrusions.
The 1.5m-high doors will go up first at Yishun, Jurong East and Pasir Ris MRT stations by the fourth quarter of next year.

By 2012, the remaining 33 above-ground stations of the North-South and East-West lines will be progressively fitted with the doors, said the LTA in a statement this week.

It said installation works will be carried out at night when trains are not running so that commuters will not be inconvenienced.

The decision to install the doors comes after a rise in the number of cases of people falling onto the tracks, whether intentionally or otherwise.

Track intrusions have gone up from an average of 16 cases a year in 2004 and 2005 to 30 in 2006 and 31 last year.

In January, the Government announced that it will install doors at elevated MRT stations to cut down on such track intrusions.

It is also spending $29 million to install more closed-circuit television cameras at train stations.

Singapore Technologies Electronics has been awarded the $112.3 million job to design and make the doors.

The company, which is also involved in the upcoming Circle Line, has worked on similar projects in places such as Taiwan, China and Thailand.

A second contract, worth $13.9 million, was awarded to Westinghouse Brake and Signal Holdings to provide the signalling interface for the platform screen doors to ensure that they are synchronised with train doors.

Source : Straits Times - 03 Sept 2008

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Singapore Labour law to cover more workers

Singapore Labour law to cover more workers

Proposed changes to benefit confidential staff and lower-paid workers

By Goh Chin Lian

A LABOUR law which has not been changed in 13 years will soon be amended to keep it up to date with today’s labour market conditions.
The Manpower Ministry is tabling for public consultation a slew of proposed changes to the Employment Act, which offers basic benefits such as salary protection, minimum employment terms and dispute resolution.

Among the beneficiaries of the proposed changes will be some 153,000 ‘confidential staff’, such as accounts assistants, human resource clerks and secretaries.

These have been excluded from the Employment Act so far because it was deemed that their access to company information could lead to potential conflicts of interest and allow unions an unfair bargaining advantage.

In today’s corporate world, however, sensitive information is largely handled by senior management, said the Manpower Ministry when explaining the proposed change.

Also to benefit from the proposed changes: About 44,000 executives and junior managers who earn up to $2,500 a month. They will be able to go to the Labour Court for salary disputes, where previously they could not.

This change recognises the increased share of professionals, managers, executives and technicians in the workplace, said the ministry.

Their proportion has gone up from 40 per cent of the resident workforce in 1997 to 49 per cent last year.

They used to be excluded from the Act as it was assumed that they could protect their own interests by going to the civil courts.

But this process can be long-drawn and costly, so the ministry is offering those paid below $2,500 access to the Labour Court.

The Employment Act currently covers some 1.4 million workers. Senior managers, seamen, domestic workers and government employees are excluded, and will continue to be excluded even after the changes.

The proposed changes also factor in the outsourcing boom that has swelled the ranks of contract workers, from 59,400 in 2001 to 183,000 in June last year, and shortened employment tenures. One-year contracts are now not uncommon.

As a result, the ministry proposes that those who have worked at least three months can now qualify for paid sick leave, instead of six months.

Also, part-time employment will be redefined as working 35 hours or less a week, instead of 30 hours or less.

Many companies told the Singapore National Employers Federation (SNEF) that the 30-hours cap limited their ability to offer part-time work, said its executive director Koh Juan Kiat.

The change will give them fresh impetus to offer such work and attract more women back into the workforce, he said.

In proposing the changes, the ministry said it struck a balance between protecting workers’ interests and ensuring Singapore’s labour market stays flexible and competitive.

The SNEF and the National Trades Union Congress (NTUC) have already been consulted on the proposed changes, it said.

NTUC deputy secretary-general Halimah Yacob told The Straits Times yesterday that the labour movement has been championing the cause of confidential staff for years, as some of them do not earn high pay.

It has also been asking for the salary ceilings to qualify for benefits to be raised, in line with median salaries here.

She said: ‘If the salary ceiling is not revised, more and more employees will be excluded from the ambit of the Act.’

The Manpower Ministry is indeed revising the salary ceiling, raising it from $1,500 to $2,000 for workers who come within the Act’s ambit.

More details of the proposed changes can be found on the Government feedback portal, www.reach.gov.sg. The public can submit feedback by e-mail to MOM_WPSD_EA@mom.gov.sg .

Public consultation ends on Sept 22.

The proposed amendments are due to be tabled in Parliament next month.

Source : Straits Times - 03 Sept 2008

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A medieval battle in Bangkok - Thailand

A medieval battle in Bangkok - Thailand

Thailand Correspondent Nirmal Ghosh was one of only two foreign newsmen present when clashes broke out at Government House early yesterday morning. He blogged about it on www.straitstimes.com. For readers who missed the blog, these are excerpts of his eyewitness account, posted on The Straits Times website at 8.01am yesterday.

Pro-government protesters wielding a slingshot and a sword in their violent confrontation with anti-government demosntrators near Government House in Bangkok early yesterday morning. The bloody overnight clashes left at least one person dead and dozens injured. — PHOTO: ASSOCIATED PRESS

AT ABOUT midnight, I got a call from a photographer friend who was at Sanam Luang keeping an eye on the pro-government crowd. ‘Come now, right now,’ he said. ‘They are marching up Rajdamnoen.’

The moment he said that, I knew something bad was going to happen. Going up Rajdamnoen could only mean one thing - they were going to challenge the People’s Alliance for Democracy (PAD).

I got there a half-hour later, and walked first through the PAD camp and lines. The mood was serious and businesslike. All the men at the barrier wore helmets and carried baseball bats. Some had slingshots. Many had improvised new riot shields. They were waiting.

From a distance, the sound of the pro-government crowd could be heard as they approached. I hurried to leave the PAD lines before I was caught in the middle.

I soon came across the vanguard, approaching on the other side of a thin double line of police with only riot shields and no weapons. There were around 5,000 of them; they had been arriving since the previous day, trickling into Bangkok from across the north and north-east.

The pro-government crowd marched quickly towards the Makkawan bridge and was met by a double row of police in full riot protection gear but without batons. In less than five minutes the police allowed the crowd through.

Minutes later the police simply walked away and watched from a distance as the almost medieval battle erupted.

Some in the crowd, armed with rods and slingshots, began to run towards the PAD’s sparsely guarded outer perimeter.

The PAD guards manning the perimeter fled and the crowd chased them, throwing aside metal barriers.

But as the few dozen young men in the vanguard of the pro-government crowd neared the PAD just after 1am, the ranks of the PAD suddenly roared and came running out in a full charge, ploughing into the pro-government crowd who were totally outnumbered and ill-equipped to defend themselves.

Simultaneously a volley of gunfire erupted from the PAD, and at least one pro-government protester fell immediately, eyewitnesses from the pro-government group said. But Thai media reported that a PAD member had been killed.

Many at the rear of the pro-government crowd were running helter-skelter as they realised the PAD had the upper hand and heard the gunshots.

Bullets zinged into the trees above me and another journalist from Bloomberg; we were the only foreign journalists there. There were several moments of panic, as I searched for a way to get out of what most of us thought was a rampaging PAD descending on us.

But the situation calmed momentarily then. Ambulances appeared with sirens howling and raced to the site of the riot, taking some of the injured to hospitals.

The street was strewn with rubble from the battle. Broken glass and flower pots crunched under my boots.

The pro-government crowd appeared stunned at being shot at by the PAD. ‘We brought sticks and knives to a gunfight,’ one man said. Several women sat on the sidewalk with their heads in their hands.

The PAD has advanced several metres and now massed in the street in a show of strength.

At 1.30am, a second wave of a few dozen pro-government supporters armed with swords and other assorted weapons appeared. This time, the police intervened, forming a line across the road between the two warring sides.

‘Tomorrow we will bring many more people,’ one pro-government protester said.

At around 2.45am, over 100 soldiers arrived with riot control gear and no weapons. The men in camouflage fatigues and holding riot shields fell in to support the police.

By 3.30am, the chance of another clash appeared to have diminished, but the mood remained dangerously volatile.

Source : Straits Times - 03 Sept 2008

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Developers starting to preview Singapore projects

Developers starting to preview Singapore projects 

With Hungry Ghost month over, condo projects being launched to test market 

By Fiona Chan, Property Reporter 
  
An artist’s impression of Reflections at Keppel Bay. Units in a new tower block there were released for sale over the weekend.

NOW that Hungry Ghost month is over, property developers are starting to line up project previews and launches to test the market.
Keppel Land released a new high-rise tower block at its Reflections at Keppel Bay on the weekend, putting up a third of the block’s 83 units for sale in Singapore and Hong Kong.

About 10 apartments have been sold since Saturday, at an average of just over $2,000 per sq ft (psf). Prices range from $1,500 to $2,300 psf, depending on the floor and the view.

A two-bedroom apartment on a low floor would cost about $1.5 million, according to property agents. Reflections has a total of 1,129 units in six high-rise tower blocks and 11 low-rise villa blocks.

Also on the weekend, Far East Organization invited interested buyers to its showflat for Miro in Lincoln Road, which sources say will be launched in about two weeks.

The freehold 85-unit development is priced at around $1,700 per sq ft (psf) on average, they said. Prices start at about $1.6 million for a one-bedroom studio loft of 990 sq ft.

Also available in the 32-storey tower are two-bedroom units of 1,302 sq ft and three-bedroom lofts at more than 1,600 sq ft.

A boutique project at nearby Moulmein Road starts previews this weekend with plans for a launch next Monday.

Mulberry Tree has 32 freehold units and a ‘retro-style’ facade, said an agent marketing the development. Indicative prices have been set at $1,300 to $1,500 psf. They start at less than $700,000 for the smallest apartment.

Agents said the two-bedroom flats, of about 710 sq ft each, would cost around $900,000. The project is forecast to be completed at the end of 2011.

Developer Hong Fok is expected to preview its Concourse Skyline in Beach Road later this month. Prices are likely to range from $1,600 to $2,000 psf, with two-bedroom units priced upwards of $1.8 million, The Straits Times understands.

The 360-unit development is slated to be completed in 2013.

Tat Aik Group has also started to preview its Nathan Residences, which will be developed on the former Nathan Court in Nathan Road.

Sales are expected to start this week, with prices in the region of $2,000 psf, said marketing agents. One-bedroom units will start at $1.2 million and two-bedroom apartments are likely to go for $1.6 million.

 
Source : Straits Times - 03 Sept 2008

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Waiver aimed at lessees of state land - Singapore

Waiver aimed at lessees of state land - Singapore

What is a building premium?
It is a charge payable by an owner when he extends the lease on state land.

The amount is determined by the chief valuer but not disclosed as it is computed into the land premium.

The premium is calculated based on the building’s condition. Lessees tended to let properties run down until the leases expire in the hope of paying less when they extend their lease.
Why waive it?
It is to encourage lessees to continue to invest in the upkeep and improvement of a property when a lease extension is granted so they will not let the site run down.

If a building premium is payable, lessees will not be motivated to upkeep, improve or redevelop a property.

It is not meant as an incentive but rather removes a factor that may have discouraged improvement work.
What’s the impact?
The waiver is expected to have minimal impact as few people will be affected, although lessees of long-term industrial land are among those likely to benefit.

In general, the Government will allow leases to expire without extension. It will consider lease extensions on a case-by-case basis. For instance, it may allow extensions for conservation properties to give as incentive for lessees to carry out major conservation works.

 
Source : Straits Times - 03 Sept 2008

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Part of lease extension levy waived - Singapore

Part of lease extension levy waived - Singapore
 
Building premium waiver will boost upkeep of ageing property
 
By Joyce Teo, Property Correspondent 
  
The ruling is likely to benefit certain groups of building owners, such as those owning conservation shophouses. — PHOTO: URA

A LEVY that property owners had to pay the Government when they extended a lease on state land has been axed.
The so-called ‘building premium’ is being waived with immediate effect, said the Law Ministry yesterday.

Waiver aimed at lessees of state land
What is a building premium?

It is a charge payable by an owner when he extends the lease on state land.
… more
The move gets rid of a potential hindrance to owners keen to upkeep, improve or redevelop an ageing property nearing the end of its lease.

It will help owners of industrial land, which tends to have shorter leases, and conservation properties but will have little effect on residential sites.

The Government has been charging both a land premium and a building premium when extending a lease.

‘The charging of these premiums was based on the common law principle that both land and buildings would revert to the landlord at the end of the lease,’ said a statement from the Law Ministry.

In the past, the Chief Valuer, who decides the premiums, had computed the building premium, if applicable, into the land premium. This made it unclear how much of the building premium makes up the land premium.

It is understood that only owners of a handful of sites, including industrial properties and conservation shophouses, have had to pay the building premium upon lease extension.

In general, the Government’s policy is still to allow leases to expire without extension because it needs to reallocate land to meet fast-changing socio-economic needs. It will consider lease extensions only on a case-by-case basis.

Industrial properties are likely to benefit more from the levy waiver. Residential en bloc sites are not affected. Under redevelopment, the estate sold en bloc is torn down so no building charge is payable even if the site’s 99-year lease is extended.

There is no building premium payable when leases are renewed on vacant land.

Yesterday’s move is not entirely new. In 1997, the Government waived the building premium for short-term or 30-year-old industrial and institutional leases on the recommendation of the Committee on Singapore’s Competitiveness, said the Law Ministry.

The latest waiver applies to all types of land, including longer industrial leases and residential properties.

It said the decision was made to encourage ‘lessees to continue to invest in the upkeep and improvement of the property’ when a lease extension is granted.

Previously, if an owner was granted a lease extension, he could opt not to redevelop the property if there was only a few years left on the lease.

He would be able to avoid paying a building premium if he let the lease run out and redeveloped the property only when the new lease started.

The waiver will give the owner no reason to hold back on redevelopment plans.

The waiver will please some owners of conservation shophouses, said Knight Frank’s director of research and consultancy, Mr Nicholas Mak.

Rising construction costs could make it worthwhile for some owners to upkeep their buildings instead of tearing them down for redevelopment, he said.

Overall, waiving the building premium is expected to affect only a small group of owners, market watchers say.

‘It’s about urban renewal but in Singapore, the strategy is to demolish and rebuild,’ said Mr Mak. Also, market watchers say most buildings are not built to last forever, particularly those on leasehold sites.

‘Properties generally become obsolete after 30 years,’ he said. ‘Factories, for instance, may become obsolete within a shorter period because of changing technology and changing manufacturers’ needs.’

The question of lease renewal will be a big issue nearer to 2070, when most of the leases on Singapore’s 99-year leasehold land will expire, Mr Mak added.

 
Source : Straits Times - 03 Sept 2008

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Thai army pledges restraint - Thailand

Thai army pledges restraint  - Thailand

Samak’s emergency decree puts Bangkok’s security under general 

By Nirmal Ghosh, Thailand Correspondent 
  
‘Our methods will be to improve understanding among Thais and make everyone aware that there can still be a peaceful solution through negotiations,’ Gen Anupong said yesterday. — PHOTO: AP

BANGKOK: Thailand’s powerful army chief yesterday assumed charge for security in Bangkok under emergency powers invoked by Prime Minister Samak Sundaravej, after a bloody overnight clash between pro- and anti-government groups left at least one person dead and dozens injured.
But it was clear that in Thailand’s charged political environment, the army would have to walk a thin line to manage both apprehensions and expectations.

Under the state of emergency, public gatherings of more than five people are banned, government buildings are off limits, and restrictions are imposed on media reports that ‘undermine public security’.

At a press conference yesterday afternoon, General Anupong Paochinda said the army would exercise restraint, deploy unarmed soldiers, and focus on preventing a repeat of the violence.

But he said it was not the army’s responsibility to end the occupation of Government House by the anti-government People’s Alliance for Democracy (PAD), a group formed in 2005 to campaign against former prime minister Thaksin Shinawatra, who was eventually ousted in a military coup the following year.

The PAD stormed onto the scene again this year after a general election swept Mr Samak and his People’s Power Party (PPP) and other allies into office. The PAD derided Mr Samak as a Thaksin puppet, a charge the Prime Minister has denied vehemently.

‘Our methods will be to improve understanding among Thais and make everyone aware that there can still be a peaceful solution through negotiations,’ Gen Anupong said yesterday.

He also discounted all possibility of a military coup, saying that this ‘will create a lot more problems’.

Mr Samak, in announcing the state of emergency during a nationally televised news conference at Supreme Command headquarters, gave no timeframe for how long it would stay in effect but said it would be over ‘moderately quickly’.

‘I did it to solve the problems of the country,’ the Prime Minister said.

‘I had no other choice. The softest means available was an emergency decree to end the situation using the law.’

As the prospect of a repeat of the violence receded during the course of the day, the army’s presence was hardly visible in the troubled area around Government House.

Pro-government protesters, loosely identified as the United Front for Democracy Against Dictatorship (UDD), withdrew from the previous night’s confrontational position and were dispersing from their rallying point at Sanam Luang, some 2km from Government House.

The opposition group remained defiant. At Government House, PAD co-leader Sondhi Limthongkul denied responsibility for the violence of the previous night, saying the government had hired thugs to attack his ‘non-violent’ group.

Another PAD leader, Mr Piphop Thongchai, told reporters that he was ready to negotiate with the army, but the demands that Mr Samak and his government resign would not change.

Separately yesterday, the Election Commission said it would recommend to the Constitutional Court that the PPP be dissolved for electoral fraud committed in the December 2007 election by executive committee member Yongyuth Tiyapairat.

The case may take weeks to be heard and decided upon, but it piled more pressure on Mr Samak in the midst of the deadlock in the stand-off with the PAD.

Adding to the government’s woes, 43 state unions with about 200,000 members have threatened to go on strike starting today to support the protesters. A top union official spoke of disruptions to train, bus and air services as well as cuts in electricity and water supply to some government buildings.

Source : Straits Times - 03 Sept 2008

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Singapore Construction sector growth expected to slow over next 3 to 4 quarters

Singapore Construction sector growth expected to slow over next 3 to 4 quarters

By Ng Baoying,

SINGAPORE : The construction sector has been a pillar of Singapore’s economy over the past two years, supporting it with on-year growth of close to 20 per cent every quarter.

But the sector’s pace of growth has slowed from the 24 per cent rate seen in the fourth quarter of last year to below the 20 per cent mark for the first three months of 2008.

Analysts said they expect the sector to continue slowing over the next three to four quarters, once the full impact of the global economic slowdown is felt.

The sector has been doing well despite general softening in the economy. But analysts said that is because the sector lags behind the overall economy.

Vishnu Varathan, regional economist, Forecast, said: “We have seen the construction sector holding up very well, even though growth in the other sectors slowed perceptibly in the second quarter. But this is actually not based on underlying demand in construction not tapering off.”

He noted that property prices are starting to cool, putting pressure on revenues. Furthermore, construction costs have gone up by about 50 per cent or more in the past two years, keeping developers on the sidelines.

Chia Ngiang Hong, group general manager, City Developments, said: “For new projects that we are planning to launch in future, we will continue to monitor the construction industry closely and make sure that we award them at the right opportune time.”

But City Developments also thinks that a cooling is in order. Mr Chia said: “I’m quite hopeful that by the second half of next year, when some of the very major projects are completed, the pace of increase should moderate. And that is when we see construction costs coming to (a) more realistic level.”

The construction sector continues to slow this year, with on-year growth at 17.4 per cent in the second quarter, down from 22.4 per cent a year ago. - CNA/ms

 
Source : Channel NewsAsia - 03 Sept 2008

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