ECONOMICS FORECAST

Construction Year
in Review & Forecast
Malaysia 2019

The construction sector’s gross domestic product (GDP) declined marginally by 0.26 per cent for the nine months ending September 2019, compared with the corresponding period in 2018.

For the first three quarters, the construction sector recorded RM109.4 billion worth of construction works, driven by growth in the civil engineering and special trades activities sub-sectors, with civil engineering being the biggest contributor to the value of construction work done.

Construction activity continues to be propelled by the private sector, with a 55.12 per cent share (RM60.3 billion), as compared to the public sector, with a 44.88 per cent share (RM49.1 billion), as of the first nine months of 2019.

According to the Economic Outlook Report 2020 released by the Finance Ministry, the construction sector is expected to end the year with a 1.7 per cent growth. However, the sector is set to expand further in 2020 to 3.7 per cent, with the building of affordable homes, as well as the acceleration and revival of mega projects. These include the East Coast Rail Link (ECRL), Mass Rapid Transit Line 2 (MRT2) and Light Rail Transit Line 3 (LRT3), electrified double track Gemas-Johor Bahru, Klang Valley Double Track (KVDT2) rehabilitation project, Central Spine Road, Pan Borneo Highway and the Coastal Highway in Sarawak.

New petrochemical and power plant projects, such as the Pengerang Deepwater Terminals (phase 3), Baleh Hydroelectric Dam and Sarawak Water Supply Grid Programme (phase 1), could also spur the construction sector.

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