The World Bank (1984) summarizes a number of challenges in developing countries’ construction industry and they include inadequate procurement and contracting procedures leading to delayed payments without adequate compensation of contractors, inexperienced and excessively rigid contract supervision, inadequate training of staff, construction business proprietors who tend to outgrow their capacity to manage construction risk, lack of a sound framework for institutional and legal arrangement; compromised construction standards and delayed completion of projects, price fluctuations of materials and other resources.
Uganda is also a developing country and obviously as you may have already noticed is facing all the above issues. We cannot talk about all the pains and problems facing the construction industry in Uganda, you have to write a whole book! So let me briefly take you through a few challenges that people in the industry face.
When a person or a company has a big construction project, they may not be able to do it on their own, so they will get a contractor. Smaller companies or entities may have to worry about brief case contractors or scams posing as contractors only to rip them of their money. Larger entities however have the capability to advertise or call on contractors to bid for the project and this reduces the risk of interfacing with scams.
When a contractor successfully gets a tender, yes, he will be happy, but there is a lot that he has to worry about even before he starts working on the project. One of them is the percentage of the project money that he has to give to whoever got him the tender. He is already compromising the quality of work to be delivered and this is why we are getting defective results from multibillion dollar projects.
The next thing he has to worry about are the costs of everything that he is going to need to complete the project successfully. Due to the weakening of the Uganda Shilling against the dollar, there is a constant rise of project costs and this includes the construction materials as well as the services to be offered.
Let’s say he has got every material that he needs for the project; now he needs labour. Obviously there are many Ugandans seeking jobs so finding people to work with is not a very difficult task. The challenge though is that most of these people can only provide unskilled labour. If it is a big project say a road or a very big building, the contractor will be forced to hire skilled labour from outside countries which costs them heavily as these people demand high salary wages, and this obviously has a negative impact on the cost of the project.
Okay, we have everything we need for the project, the next thing the contractor is concerned about is the safety of the site. The construction industry is a risky industry and this is why there is high demand for insurance and compensation claims from serious injuries caused on sites. Many contractors pay high premiums for various types of insurance and this impacts operations around the project because it is costly.
It is evident that the problems that the nation faces as a whole directly or indirectly affect the construction industry as well. From the above we can see issues of corruption, inflation, unemployment among others. Like I said earlier, we cannot talk about all of them and finish. This is simply a sneaky peak into a few of them.