The Chilean Chamber of Construction (CChC) said the country’s construction sector is facing a significant downturn this year because of the COVID-19 outbreak. The industry was already struggling following the social unrest in October last year.
CChC said; ”The situation, although it originated in the social crisis of 18 October, has worsened with the spread of COVID-19 and its impact on current projects, on business confidence, and in access to credit for financing.”
One of the direct impacts will be the total investment in construction this year. In December CChC was already projecting a fall of 7.7%, and on Monday 6 April the forecast was lowered to -10.5%.
Within this, CChC is forecasting a 9% fall in infrastructure and a 13.2% decrease in housing. Similarly, the unemployment rate in the sector could exceed 12% by the end of 2020, equivalent to about 75,000 fewer jobs.
The Chamber called on companies in the sector to intensify prevention measures on sites, in order to protect workers, employment and to avoid new stoppages. Currently, in areas that are under mandated, total quarantine, more than 350 projects have been suspended.
“We are facing a recession scenario that could be more severe than the 2009 subprime crisis and the 1999 Asian crisis”, said Patricio Donoso, president of the Chilean Chamber of Construction.
”That is why it is essential that, in addition to taking all measures to protect the health of workers and prevent Covid infections- 19, work in progress should be continued. Without new projects and with stopped work, there is no income and, without income, the loss of jobs and the bancruptcy of companies become a real risk.”
The concerns of the Chamber are shared by companies in the field. According to the latest business expectations survey of its members conducted by CChC, 79% estimate that the Covid-19 pandemic will have a “high” or “very high” impact on their activity.