After a tumultuous few years in the wake of a worldwide pandemic, the Singaporean construction market is finally starting to see some improvement. Despite a decline of 38.4% in 2020, Singapore’s construction industry experienced annual growth of 20.1% in real terms in 2021.
In 2021, the construction industry contributed almost 3 per cent of Singapore’s nominal GDP. While it was seriously affected by the pandemic in 2020, the construction market expanded by 20% due to Singapore’s robust post-virus economic rebound in 2021. Even though the industry hasn’t yet recovered to its pre-COVID-19 levels, a number of significant public sector initiatives are anticipated to accelerate development and recovery over the following years.
The low base in 2020, together with an improvement in the state of the global economy, and investments in infrastructure and housing construction projects, all contributed to the industry’s growth in 2021. The Housing Development Board (HDB) of Singapore said in January 2022 that, despite the inconvenience brought on by the Coronavirus (COVID-19) pandemic, it had produced roughly 14,500 HDB units in 2021.
More than 91% of Singapore’s population has received the full COVID-19 vaccination after more than two years, as the nation continues to become prepared to live with COVID-19. Malaysia has just established the Vaccinated Travel Lane with Singapore after combating a high number of COVID-19 cases over the past few months. They have also now relaxed the majority of restrictions. Pre-cast and pre-fabricated modules, in particular, have been made easier to ship from there, which has been a step that the Singaporean construction industry has largely appreciated.
Increase in construction demand
The overall demand for construction rose by more than 40 per cent in 2021 following a record recession in 2020 that witnessed the weakest building demand in years. This increase was anticipated as a result of the majority of job sites not reopening until August 2020 after the country had a two-month circuit disruption in the second quarter of 2020. Unsurprisingly, infrastructure projects experienced the most growth, driven by efforts like the Land Transport Authority’s Jurong Region Line and Cross Island Line Phase 1 stations, viaducts, tunnels, and depot (LTA). The Urban Redevelopment Authority (URA) and LTA recently awarded the pilot tender for the deployment of 40,000 electric vehicle charging outlets in public parking lots by 2030.
The North-South Corridor, Singapore’s most significant road project, is already under construction and is expected to be finished by 2026. Its impressive civil engineering projects, like the 62km-long Coast-to-Coast (C2C) Southern Trail, a walking and cycling path that spans the entire island, and the building of the Integrated Transport Hub located in Jurong East, will further increase the demand for construction. The Cross Island Line Phase 1 is an expansion of the Mass Rapid Transit (MRT) system with 29 kilometres and 12 stations. With all of these projects on the backburner, the BCA forecasts that Singapore’s construction demand in 2022 will range from 27 to 32 billion Singapore dollars.
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