The construction sector might well be one of the drivers of the Maltese economy post-COVID-19 but Malta should use this time to shift its focus to sustainability, two economists agree.
They were reacting to a statement by Prime Minister Robert Abela that the construction industry could help the country out of the depths of economic slowdown caused by the pandemic.
Economist JP Fabri, a partner of Seed Consultancy, said that while the construction sector could play an important role in supporting the general economic ecosystem, the country needed to look at a sustainable, long-term model.
“The economy is an interlinked chain of different sectors, which together sustain activity and generate jobs and wealth. All sectors have an important role to play in the economic recovery, including the construction sector.
“We need to see construction as a supporting role in the general economic ecosystem whereby it responds and sustains the general economic performance,” he said.
“Going forward, the country needs to look at a long-run sustainable model and vision of growth, including the need for the sector to continue transforming itself by focusing on regeneration, rehabilitation and on green, smart buildings.”
According to a research study conducted by his consultancy firm, it was evident that business leaders were looking at postponing investments and not cancelling them.
“This means that the projected investments, including those related to construction, will continue. But it is also important to focus on strategic spatial planning to ensure that the supply we are putting on the market mirrors the expected demand.
We should take this opportunity to invest in the infrastructure that we really need
Sustainable and quality growth should be a priority, with a well-diversified economic base. This should be our national focus,” he said.
In a similar vein, economist and lecturer Marie Briguglio told Times of Malta it was important that the sectors that can still work do so prudently.
This would help prevent total meltdown and avoid larger bailout costs.
But she argued that this was the time to invest in much-needed social infrastructure.
“We should take this opportunity to invest in the infrastructure that we really need. We need safe pavements everywhere. We need public open spaces. We need a modal shift and the kind of infrastructure that allows it.
“While we are in hibernation, it is a great time to do this. We could wake up to find a better, more socially inclusive Malta with 2020 infrastructure,” she said.
On whether the construction industry will play an important role to revive Malta’s economy post-COVID-19, Briguglio said the key to economic revival will be adaptation by the private sector and the kind of assistance the government rolls out.
“A lot of what is keeping the economy ticking right now, for instance, is the ability to work from home, the flexibility of certain businesses. Let us not underestimate how this adaptation has been key and will continue to be key post-COVID.
“Moreover, whichever sector the government assists, be it directly by aid or indirectly by easing constraints, will be important to the recovery.
“I hope that if it is the construction sector, then at least the focus will be on much needed social infrastructure for a better quality of life,” she said.