Rise of the new construction ‘mafia’
Wednesday, 17 April 2019
Posted by: SAFCEC Communications
Source: Mail & Guardian | 12 April 2019 | Journalist: Lynley Donnelly
They have been dubbed criminal, and labelled the construction mafia. Their proponents believe they are legitimate agents of “radical economic transformation”. It is often unclear where the line between armed violence and genuine demands for access to economic opportunities falls.
What is certain is that about 183 infrastructure and construction projects nationwide, valued at more than R63-billion according to one industry body, have been hindered — often by violent disruptions led by entities claiming to be local community or business forums, demanding a stake, typically 30%, in projects.
The phenomenon emerged in the Durban area of KwaZulu-Natal and began hitting the headlines in 2016.
It has since spread across the country at a time when the construction sector is in dire straits — a series of major players have filed for business rescue or have reported depressing financials.
State infrastructure projects have been the worst hit with the likes of the South African National Roads Agency (Sanral) seeing more than 60 projects affected to a varying extent, including its R1.6-billion Mtentu bridge project, expected to be the highest bridge in Africa, and a road contract near Stutterheim.
Both are in the Eastern Cape.
But private sector projects are not immune from destructive actions by people demanding work. A R2.4-billion German oil storage investment, being built by Wilson Bayly Holmes-Ovcon (WBHO) in Saldanha Bay in the Western Cape was halted in early March after “armed gangs” demanded a stake.
Rise of the ‘business forum’
Roy Mnisi,executive director of Master Builders South Africa (MBSA), said that although the phenomenon started in KwaZulu-Natal, it has spread into other provinces, including the Eastern Cape, Gauteng and Mpumalanga. He spoke to Mail & Guardian en route from Mbombela (Nelspruit), where the construction of a fresh-produce market has ground to a halt because the contractor “cannot work”.
“It’s happening everywhere,” he said.
An industry under siege
A common industry complaint has been the failure of law enforcement and government agencies to adequately deal with these events when they happen. And although public infrastructure is damaged or projects delayed for months, ramping up their costs, small black businesses are suffering too.
Webster Mfebe, the chief executive of the South African Forum of Civil Engineering Contractors (SAFCEC), wrote a letter to President Cyril Ramaphosa last month pleading for government intervention. He cited the example of the 2016 killing of a Durban construction company owner who was shot when he refused “disrupters” a stake in a tender he was awarded. Mfebe told the M&G this week that there has been no progress in the case, despite the police force’s knowledge of the incident.