Redefining the construction sector to stimulate growth. 0 58

  • How has the construction sector performed post-COVID?

To start off, most countries in the world have permitted the construction industry to operate despite the pandemic, given that the industry has been identified as one that could function amidst the prevailing situation. However, operations in Sri Lanka were directly impacted due to the various curfews and restrictions that were imposed during the first two quarters of
the year.

However, after the government identified the importance of
continuing construction sector operations, whilst abiding to the relevant precautions that have been set, there has been a substantial improvement and increase in construction activities during the 3rd and 4th quarters. Despite this, we do notice a slowdown in the overall industry when taking the whole year into consideration.

According to the July Monthly bulletin published by the Central Bank of Sri Lanka this year, the value of construction activities carried out in the 1st quarter of 2020, at current market prices, was Rs.245.7 Bn. This is a reduction of 14.6% in comparison to the 4th quarter of 2019. At 2010 constant prices, the value of construction activities in the 1st quarter of 2020 was Rs.149 Bn, a reduction of 14% compared to the 4th quarter of 2019.

From a company perspective, Access Engineering’s turnover during the April-September How has the construction sector performed post-COVID? 2020 period was Rs.7.9 Bn. This was a Y-o-Y reduction of 7.3%. Hence our company has outperformed the industry norms during the post-COVID period. The primary reason for this comparatively better performance is due to us carrying out work in some of the strategically important and economically vital projects in the country. Our Q-o-Q growth during the 2nd quarter of this year was over 50%, as a result of us being able to carry out more work during this period. We are currently continuing work on most of our projects, and are hopeful of a satisfactory performance during the 3rd quarter too.

  • Where is Sri Lanka placed in the global construction spectrum?

In 2018, the global construction market stood at $10 trillion, while in 2019 the local construction industry stood at $6 billion. Hence, the local construction industry is approximately 0.06% of the global market.

Sri Lanka is geographically located along the OBOR (One Belt One Road) initiative. The initiative is expected to be worth well between $4-8 trillion and will offer important economic opportunities to Sri Lanka.

The construction industry in Sri Lanka experienced growth well above the country’s GDP growth levels during the last 2 decades, due to the large-scale infrastructure development projects carried out in the country.

The Government’s initiatives to award some of the large infrastructure development projects have provided the opportunity for the industry to gain the necessary experience, exposure and pre-qualification in implementing such projects. The project management skills of some of the leading contractors are considered to be on par with international contractors. This provides the opportunity for local contractors to further expand their businesses by looking for opportunities in their respective overseas markets. However, the global opportunities for the local construction industry are quite limited, due to the funding mechanisms in place to promote such activity. Sri Lanka’s economy is not in a position to support the industry to venture into global markets with attractive development financing.

Our industry has its own specialist skills and competencies, including good project management, where some of the leading contractors have carried out work overseas. We have been invited by one of our European construction partners to join them to carry out construction work involving the building of bridges and flyovers, which we are currently carrying out in Kenya.

Similarly, we were invited by one of our Chinese construction partners to carry out specialized construction-related work on a port project in Papua New Guinea. The construction
activities anticipated to take place within the port city development project would also contribute to Sri Lanka being a focal point for the industry. 

  • Is Sri Lanka ready for a modern construction environment?

Most Sri Lankan engineering professionals including structural, civil, and design engineers and consultants are reluctant to use innovative and unconventional construction methodologies. Hence, they tend to design and build structures that give very little attention to efficient space utilization, material consumption, innovative construction methods and etc. In addition to this, most of the curriculum at local universities and technical colleges are conventional and traditional. As a result, students are given very little exposure in their academics to explore new construction methods. Local universities also have very limited capacity for research and development efforts including laboratory facilities. Due to these reasons and more, the engineering fraternity produced by the local higher education system has a lack in new thinking and innovation. 

Despite all these hindrances, there are industry players that have adopted modern construction methods and applications to create value for the services they offer where the staff provide the required aptitude, attitude and capacity to absorb and apply the same. The provision of opportunities and an environment for local contractors to be involved in the major infrastructure development projects in the country will provide the required exposure and experience needed in the modern construction environment. 

Looking at it from a company perspective, Access Engineering has been in the forefront of embracing new technology, exploring and introducing many new and innovative construction methods in the industry. As a result, we have been recognized as the “Best Tech Savvy” business in the industry, receiving various accolades and awards. From an R&D perspective we tie up with the R&D divisions of implementing agencies in order to continuously make necessary product and process improvements.  Our most recent initiative is the creation of an “Innovation Hub” in order to facilitate the development of innovative ideas in students and academics attached to the industry. 

For example, some of the modern construction environments our business has been exposed to include Sri Lanka’s first largest wind power project in Mannar and Sri Lanka’s largest single roof warehousing facility in Kimbulapitiya.   

  • What needs to be done in order to become a globally Competitive player?

As mentioned above, structural changes in our education system is necessary in order to focus on globally required skills. Having said this, we do have excellent human resources with the obligatory intelligence and aptitude needed to absorb such skills. A vital part of construction would be getting the necessary pre-qualification. In order to acquire this pre-qualification and experience, our industry must be given every opportunity to be involved in large scale infrastructure development projects that are carried out in the country.  

In order to become a globally competitive player, value creation, value addition and exposure to large scale local projects will help enable the industry to be more competitive locally which could be thereafter taken on to a global scale. 

  • Has the 2021 Budget addressed these matters in order to incentivize the sector, to be globally competitive?

The 2021 budget has recognized the construction industry as a major contributor to the national economy, including a provision of necessary incentives for investment and growth of the industry. The government has been consistent with the commitment of maintaining the tax rates and concessions given over a period of 5 years. The budget has not only directed its focus on providing opportunities to the construction industry to be involved in construction development projects carried out in the country but also to deliver the relevant income tax incentives for the local construction companies who carry out work overseas. 

However, it is important to note that there are many other factors to be considered, for the industry to be a globally competitive player. 

  • How will the construction industry compliment the economic growth vision set up for Sri Lanka?

For the past two decades, the construction industry has been a major contributor to the development agenda of the country. It has been a catalyst for economic growth in Sri Lanka. This is evident through the contribution made by the construction sector to the country’s overall GDP which has been very significant. In addition, the employment generated through the industry has been consistently in the range of 6%-8%. The industry would need to play a vital role in the economic growth vision set up for the country where usage of local resources, material and finance needs to be maximized in order to retain the much needed foreign exchange in the country. Furthermore, the construction industry has the required capacities, capabilities and competencies to carry out large scale infrastructure development projects in the country in a very cost effective manner and is well positioned to complement the economic growth and vision set up for Sri Lanka. 

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Jetwing Hotels – What Makes Them So Different? 0 2885

A warm and friendly nature reflected in tireless smiling faces, and willingness to help those unaware with phases of local life. From the beautiful beaches of the South-Western coast to the toe tapping and exuberant Kandyan dances, along with the majestic and ancient architecturally and archeologically distinguished cities. Bright, sunny warm days are in abundance and are common even during the height of the monsoon. The humble desire to share this experience of heartfelt warmth and the true hospitality of the people living in the small miracle in the Indian Ocean called Sri Lanka, a homely villa was built named Blue Oceanic, which is now the Jetwing Blue, with just six rooms in the early 1970s facing the sandy beaches in the Negombo City.

Hiran-CoorayA simple dream of sharing the uniqueness of this beautiful island, one of the largest, most respected, and recognized tourism organizations were born. Herbert Cooray – a visionary, a pioneer of tourism in Sri Lanka and the founding father of Jetwing, the largest family of hotels and villas across Sri Lanka, opened its doors to the world welcoming them to a family of hotels like no other.

Inspired by Herbert Cooray, his son Hiran joined Jetwing as soon as he completed his education graduating from the University of North Carolina, USA, prior to which he studied at St. Joseph’s in Colombo. Following family tradition seems to be established. Just like Hiran his sister Shiromal took up their father’s legacy. At 29 years of age, Herbert Cooray left his job to join the family business N. J. Cooray Builders – a building construction company which was founded by Herbert’s father, Jeremias.

The founding principles his father inculcated in Hiran and the family have today become the very pillars that Jetwing group operates on: “…Passion, Honesty, Integrity and Tenacity – these were the values my father instilled in us throughout our lives and they continue to be the Jetwing family philosophy. It is the secret of our success. I have the incredible honor and the responsibility now to do justice to his legacy.

The essence of simplicity and modest allure, Hiran is a son who continues to do his father proud.

BiZnomics had the pleasure of speaking to the veteran hotelier HIRAN COORAY of his journey and experience gained throughout.

Q: What was the foundation for Jetwing?

A: It all started with my dad in 1973. He started off with the Blue Oceanic Hotel in Negombo with just six rooms and later moved on to further rooms. It was just a simple beginning eventually created the Jetwing family. It was a time that no one really thought of tourism, and for some reasons it progressed quite well for the next 10 years. Then he moved onto building Royal Oceanic. Blue Oceanic now goes as Jetwing Blue and the Royal Oceanic is Jetwing Beach. During those 10 years my dad probably would have owned about five hotels. Although towards the ‘80s the troubles broke out, it didn’t really stop him from expanding. In fact, that was the time he started Jet Travels, which eventually became Jetwing Travels at the end of the 1980s.

Q: How did young Hiran get involved in the whole thing?

A: Being a Josephian, my only interest was in cricket at that time. I was the Vice-Captain of the school team and represented the Sri Lanka Schools as well. However, I realized there would be no future in cricket so that I concentrated on my studies. I went to North Carolina, Greensboro University and came back in 1987. It was also my father’s decision that made me come back. 1987- 1989 probably would have been the worst two years of history, having riots breaking out all over the country on top of the ongoing civil war but my father wanted me to come back and that’s just what I did. A degree doesn’t really tell you anything when it comes to practical knowledge. Within a year he made me the Managing Director, my father’s words were “if Castro could control a country at the age of 25, why is it difficult for you to run a company at the same age?”

Q: What are the set of goals for Jetwing?

A: What we want is to be the ‘Best service provider in the country’. In whichever way we expand we want to be the best at it. As my father used to say, provide a legendary service. In order to provide it, we have to look after our staff as much as we look after our guests. That is one of the main goals and we work on that continuously. We have been pioneering in to different new areas of tourism. We were the first to build hotels in Galle in 1995. Other than New Oriental (now Amangalla) there was nothing else. My father built there when everyone said it was going to be a failure. We started Lighthouse which is an iconic hotel in Galle. Then we went to Wellawaya when people questioned why? Again we educated people in Sri Lanka why one should visit Wellawaya. We then built in Potuvil. It is a Muslim village in the deep South East corner of Sri Lanka. People always have that question as to why? We built in Jaffna. We were the first company from the South to go to Jaffna. There were hotels there of course, but we were the first to go from this end. We have the pioneering spirit, creating opportunities and taking the lead.

Almost all our hotels were in the high-end category, but now we are working on the budget brand. We were the first to introduce that as well in 2013 called Hotel J in Negombo. Now there are three budget hotels, Hotel J Ambalangoda, Negombo and Unawatuna.

 

 

 

 

 

 

 

 

 

 

It is quite similar to a low cost carrier. You will have to buy everything apart from the seat provided in the aircraft. Similarly our brand provided at hotel J is a clean room, clean bathroom, air conditioning, WiFi, and safety. If you are a single female traveler, you must feel safe in a room. That is the five brand promises we give at hotel J. Everything else including carrying your own bag is your responsibility. And you will have to purchase everything including the bottle of water in to the room.

Hiran-CoorayQ: How do you maintain the standards of the company and its employees?

A: Continuous training. We have to be at it every day.

Q: Do you have a gender balance in your organization?

A: We are the only organization that has five female General Managers. We are very proud of that they do an amazing job. The fact that we have females in this position motivated others to improve themselves to achieve their goals. We started these 20 years ago and it is not a new concept for us. All our staff has the opportunity to grow in the company. A good example is the Manager at Jetwing Sea, who started as a security guard. We allow people to develop and it also should be in them to develop themselves by taking the opportunities.

Q: If a female employee is sexually harassed, how would it be handled?

A: We have very strict rules on those. We educate our staff on what can be said and what cannot be said, how important it is to behave in certain ways in the company. Even a simple touch is not allowed. It is a serious offence in the company and we take disciplinary action against such behavior.

Q: How does the political uncertainty affect foreign investments in our country?

A: Government policies are essential to attract foreign investors. Whenever a government changes policies change and can discourage that investors in tourism and other fields. We are sons of the soil so we have left with no choice. When foreign investors know that our policies change every time a government changes, they will not think of a long term or a safe investment environment in this country.

Q: How likely is it that a customer recommends your hotel to another?

A: We make sure the service we provide is of no comparison. The relationship we maintain with the local community, what we do to preserve the environment, all those factors are important to place your high up in the industry. People are very much aware of the environmental impact and community involvement. If you genuinely do that, look after the local community, employ and create opportunities for the local community and also look after the environment, and you showcase it, the customer who studies and buys a product will always choose the right one over others. That’s one of the very obvious difference between Jetwing and others.

We have a programme called JYDP ‘Jetwing Youth Development Programme’ which we started in the year 2006 and up to now we proudly say we have trained nearly one thousand youngsters in the hospitality industry and the English language.

Q: A little bit more on the political side. What do you think is the future status of this country?

A: My wish is that the private sector will not be dependent on politicians. The private sector has a very important role to play, irrespective of who is in leadership. The private sector must continue to play the role. The private sector should not get involved in lobbying and directing politicians. A politician should look at the country in the long term aspect, viability, sustainability of the country, and I will support anyone who thinks long term, not only till they serve the number of years. Sadly they think short term.

Q: What are your thoughts on taxation?

A: We live out of this land; hence we have to pay something for that. As long as it is bearable it is fine. I mean the Government provides certain facilities free like medical and education. That is a huge cost to the government. Somebody has to pay for it. We can’t really be borrowing to pay for those essential requirements.

I am very much against giving free higher education. Maybe the government should provide a loan facility at a very low interest rate to pay off in a certain number of years, as students have no value over what they get free. When you are given free education, they expect the government to find them a job as well. What can they actually do for themselves in that case? As a youth you should not be a burden to the country. Appreciate what you get and learn to stand on your own feet. The Government educates them free, give degrees free, and then as it is, a job should follow. How unreasonable can they be?

Value what you get free; at the same time be a responsible citizen, not a burden to the country. That’s something I very strongly believe. Appreciate what the country is doing for you. It is all our taxed money that the Government is utilizing on their education. They should at least appreciate that fact.

Q: What is the biggest people problem you are facing right now?

A: Leaving the country. After training them so hard when they leave, it hurts the company.

In a nutshell

Q: One word that describes you best?
A: Down-to-earth

Q: What are your three biggest accomplishments?
A: Number one: I am blessed with three great sons.Number two: Carrying on what my father started and adding value to the tourism industry in this country.
Number three: Being chosen as the Chairman of the Pacific Asia Travel Association the only Sri Lankan to be chosen from a small island to chair that organization for two years.

Q: What animal do you like most?
A: I am a bird watcher. It is fascinating to see their colors. I get much inspiration through that.

Q: What do you do outside work?
A: Watching cricket matches and I like walking.

Q: On a scale of 1-10 how lucky are you?
A: 10 definitely.

Q: What kind of books do you read?
A: I love reading management books, religious books, biographies and sports.

Q: If I am to take over your position, what advice would you give me?
A: Be humble, willing to learn and an honest leader.

Q: When it is all over, how do you want to be remembered?
A: A simple man who tried to make a difference (laughingly).

By: Chantal D.
Photography by: Nuwan Ranaweera

Circular Economies: Is Sri Lanka’s Waste Crisis a Wasted Opportunity 0 570

Circular-Economies-Is-Sri-Lanka’s-Waste-Crisis-a-Wasted-Opportunity-1

 

Sri Lanka is currently in the midst of a waste crisis with landfills running out of space and the costs of disposal spiralling rapidly. A recent report by the WWF named Sri Lanka as the fifth largest contributor to marine plastic pollution and the level of recycling in Sri Lanka in particular for plastics falls well below global averages.

Circular-Economies-Is-Sri-Lanka’s-Waste-Crisis-a-Wasted-Opportunity-2

 

The Sri Lankan economy on the other hand, continues to suffer from a significant balance of trade deficit and a weakening rupee in part due to imports for raw materials such as plastics, aluminium, paper/cardboard and electronics. Finding a way to increase the domestic ability to sort and recycle these materials for re-use in a circular way may in fact provide a solution for both the environment and the economy.

Circular-Economies-Is-Sri-Lanka’s-Waste-Crisis-a-Wasted-Opportunity

 

A linear economy, which typifies most products and materials here in Sri Lanka, is one whereby products are manufactured, used and then disposed of as waste. A circular economy by contrast, is one that aims to eliminate waste through the continual use of resources by reusing, repairing, refurbishing, remanufacturing and recycling raw materials and products at the end of their usable lives. This therefore closes the loop on the manufacturing process thereby reducing the need for new materials.

 

Circular-Economies-Is-Sri-Lanka’s-Waste-Crisis-a-Wasted-Opportunity-2

The waste problem is not just limited to the Sri Lankan economy as materials such as plastics do not biodegrade and therefore will continue to exist until a solution is found. Plastic breaks down into what is known as microplastics after some time which significantly harms the environment as animals ingest this and toxins from the material itself seep into the water table. Recent studies suggest that we are ingesting the equivalent of one credit card every week. The health impacts of the plastic epidemic are likely to grow significantly.

Cont..

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