Question 1 (a) Figure Q1.1 shows the Singapore construction demand curve for building works from 2011 – 2020 in relation to BCA’s Tender Price Index. See also Table Q1.1. According to classical economics, as prices increase demand decreases.
However, the Singapore construction demand curve in Figure Q1.1 shows a reverse. Generally, as prices increases, the contract awarded is higher. Explain THREE (3) possible reasons which resulted in Figure Q1.1.
(b) Figure Q1.2 shows the comparison of Singapore GDP against URA’s Private Property Index and Private Sector Building Works awarded after normalizing. See also Table Q1.2. Discuss FOUR (4) observations you could derive from Figure Q1.2.
Figure Q1.1 99.8 99.7 104.6 106.8 104.0 98.0 96.7 98.6 99.9 102.8 96.0 98.0 100.0 102.0 104.0 106.0 108.0 0 5,000 10,000 15,000 20,000 25,000 30,000 35,000 Tender Price Index vs Both Sector Buildings Works
Year 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020
Both Sector (Building Works) 28,747 25,951 28,863 28,854 21,560 17,429 15,453 21,071 24,507 15,374
Tender Price Index 99.7 99.8 104.6 106.8 104.0 98.0 96.7 98.6 99.9 102.8
Table Q1.1 Figure Q1.2 Table Q1.2 0.50 0.60 0.70 0.80 0.90 1.00 1.10 1.20 1.30 1.40 1.50 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 GDP vs Pte Pty Price vs Pte Sector Building Works GDP At Current Market Prices URA Private Pty Index Private Sector (Building Works)
Question 2 (a) According to BCA’s media release in January 2021, ‘‘Public sector construction demand dropped from S$19.0 billion in 2019 to S$13.2 billion in 2020, as some major infrastructure projects that required more time to assess the pandemic’s impact on resource management and project schedules, were postponed. Meanwhile, private sector construction demand decreased from S$14.5 billion in 2019 to S$8.1 billion in 2020, due to market uncertainties amid the COVID-induced economic recession…’’.
Discuss what is ‘pump priming’ in respect of the construction industry and the possible causes why it did not elevate the construction industry for the year 2020.
(b) Outline and discuss the impact of COVID-19 on a contractor’s cost structure for the period 2019-2021.
Question 3 Refer to Obayashi (Japan) and Lum Chang (Singapore) 2020 annual report. Using these reports and other relevant information sources, carry out the following:
(a) Outline in a table the difference between the two construction companies the following:
(i) Financial performance
(ii) Geographical coverage of their business
(iii) Technological capabilities
(iv) Types of projects undertaken or business lines
(b) Evaluate the competitiveness of Lum Chang as compared to Obayashi and propose how can Lum Chang be more competitive.
Question 4 The Building Construction Authority (BCA) has identified in the Construction Industry Transformation Map (ITM), Integrated Digital Delivery (IDD), as one of its transformation pillars.
(a) Identify and discuss FOUR (4) benefits of IDD.
(b) Identify and discuss FOUR (4) challenges or issues in implementing IDD.
