As the world battles to contain the outbreak of the Covid-19 coronavirus disease that has so far taken the lives of more than 3,000 people, the Kenyan construction industry is taking a major hit from indefinite delayed shipments of important construction products.
Most factories in China — the world’s second-largest economy — have been on lockdown since January as Beijing scrambles to contain the epidemic, disrupting global supply chains.
In Kenya, for example, four Chinese cargo ships that supply goods from China have failed to dock at the port of Mombasa for the second month in a row following the outbreak of the virus, according to the Kenya Ports Authority managing director Daniel Manduku.
This implies that eight shipments have failed to arrive in the first two months of this year.
“The port of Mombasa receives three big discharges from China under Evergreen Line and one COSCO (China Ocean Shipping Company) ship on a monthly basis. The four ships have not called since the coronavirus effect in China,” Mr Manduku told The EastAfrican.
China is Kenya’s chief supplier of machinery, furniture, kitchenware, prefabricated buildings, iron and steel products among other products.
Machinery valued at Sh54.54 billion was shipped into Kenya in 2018, with iron and steel products worth Sh48.01 billion and Sh12.43 billion worth of furniture arriving in Mombasa.
Homeowners and developers have been turning to China for house fittings such as high-end picture frames, locks, drawers, wardrobes, ceiling boards, ceramic tiles, and many others, thanks to their classy designs and their ability to lower building costs by up to 40 per cent.
“We are receiving delayed shipment notices that indicate withdrawal of shipments. It is quite hectic now as we try to deal with customers who are running out patience,” says Jamleck Ngari who imports construction products from China.
The Yiwu Construction Market from which Ngari orders for most of his products remains closed indefinitely with the anticipated opening date of February 21 again adjourned.
In addition to the delayed arrival of products, the coronavirus epidemic has also impacted on construction workforce especially on mega constructions contracted to Chinese construction professionals, who were on annual vacation in China when the outbreak occurred.
As a safety measure, Beijing disallowed non-essential outbound travel, meaning those workers are unable to return to Kenya for work. This has badly impacted progress on construction sites, exposing contractors to substantial cost implications.
Most construction contracts usually place the risk of material delivery and delays on prescribed completion times on the shoulders of contractors, meaning a builder will bear the monthly costs of being on site for longer than expected.
However, some contracts have tolerable provisions to allow for time extensions. For example, the impact of the coronavirus may be viewed as an unforeseen epidemic that prevents either of the parties from fulfilling their duties under the contract.
What we can expect
While some industry analysts are hoping this will be only a temporary disruption that will slow down in the coming weeks, the coronavirus is now proving to be difficult to contain.
About 90,000 people across 58 nations have now tested positive for the coronavirus, while the death toll globally has exceeded 3,000, according to the World Health Organization.
And with little sign of an immediate cure to the Covid-19 coronavirus disease, there remains an earth-shattering risk of additional delays and humongous cost overruns.