Construction sector slows down due to resorts completion

Tang Hon Cheong

The president of the Macau Construction Association, Tang Hon Cheong, noted that the gradual completion of Macau’s hotel and casino projects is leading to a slow season for the construction industry.

“In the past two years, big hotel projects were gradually completed. […]  The competition in the market is fierce; operations [of the construction companies] struggled with small difficulties, [because] the market [for construction] has shrunk, and some jobs were reduced,” said Tang last week on the sidelines of a seminar organized by the Macau Construction Association. Tang also noted that the government launched a few public projects during this period in order to fill the extra time left by the hotel projects.

However, the gap between the completion of hotel projects and the launching of government projects still gave a hard time to the construction sector.

“There are too many companies, including management and big scale Chinese companies. When the market’s total [demand] is decreasing, naturally, the shares [each small company can get] get smaller, and the competition becomes fiercer,” explained Tang.

Regarding the exact decrease in the number of construction projects, Tang said that he has not estimated the number.

“In the past, hotel projects alone [involved] 30 to 40 billion patacas [in terms of project prices] per year. In turn, the governmental projects represent approximately 10 billion patacas per year,” said Tang. Tang added, “if we add together all projects [including other projects], then the previous casino projects alone occupy one third of [Macau’s total construction projects per year].”

Furthermore, Tang pointed out that the market’s whole projects decreased by more or less one third due to the completion of the casino projects.

In Tang’s opinion, the Greater Bay Area development plan and the One Belt One Road strategy will bring some opportunities to the Macau’s construction section.

“The One Belt One Road strategy might not bring Macau too many opportunities, but the Greater Bay Area should offer more,” declared Tang.

When talking about the construction sector during the period with more hotel projects, Tang said that “there are huge differences between having or not having [hotel projects].”

However, Tang believes that Macau’s construction business “has not stopped”, only that it has entered “a slowed-down period.”

Also during the seminar, the Secretary General of the Macau Construction Association, Lo Chi Hou, suggested that Macau reduce the amount of construction waste, and improve the awareness of the need for environmental protection within Macau’s construction sector.