Government Urged To Intervene In Cement Price Hike Issue
With the cement price hike expected to raise construction costs, the government has been called to intervene to ensure housing affordability.
“I really hope the government could look at this issue seriously as the cement price increase will spark a chain reaction in the industry, thus discouraging developers to build,” said LBS Bina Group Bhd Managing Director and MGB Bhd Group Managing Director Tan Sri Lim Hock San.
As reported in The Edge, he noted that an increase in cement prices will raise construction costs – squeezing further the margin for affordable housing developments – which could discourage developers into rolling out such projects.
Construction Industry Development Board (CIDB) CEO Datuk Ahmad ‘Asri Abdul Hamid revealed that the proposed 40 percent hike in cement prices could push up building costs by seven to eight percent, based on simulations conducted by them.
Works Minister Baru Brian, on the other hand, believes that an increase in cement prices would affect the domestic construction industry.
“As the Minister for Works, I am very concerned that this development comes at a time such as this, because it would have an impact upon the growth of the construction industry,” said Bian at the signing of a memorandum of understanding (MoU) between CIDB, UEM Edgenta Bhd and the Malaysian Highway Authority (MHA).
When asked on the measures that the industry would take to mitigate a potential price hike, he said the ministry will discuss the potential impact of the price increase with the board as well as other industry players to find a solution once the hike occurs.