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Construction jobs at stake

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Two of Sri Lanka’s largest construction companies MAGA Engineering (Pvt) Ltd and Access Engineering PLC have decided to retrench at least 20 percent of its current labor workforce on the back of the new government stalling many construction projects, informed sources said.

According to officials, infrastructure development had slowed down drastically under the present government, which had focused on constitutional reforms and good governance.

“MAGA has decided to retrench 3,000 of its employees out of its total workforce of about 14,500 in the coming months. Likewise, Access Engineering will also relieve approximately 850 employees owing to projects being halted and the uncertainties surrounding their recommencement,” a construction industry source said on the condition of anonymity.

A high ranking official attached to MAGA told The Nation Gain, that the company had decided not to extend the contracts of the said workers when they expire during the coming months.

The official added that those who would be relieved were contractual workers and therefore there wouldn’t be any legal implications.

Accordingly, MAGA’s project volume had dropped by at least 30 percent which had resulted in the company taking measures to cope with the situation.

The official said that MAGA was contracted to construct a building for Rakna Arakshaka Lanka Limited (RALL) in Colombo and added the project had been halted after piling works had been carried out. “We don’t know whether it would resume,” the official said.

In addition, MAGA was also contracted to for the construction one segment of the Northern Expressway and had spent approximately Rs.100 million. “We were to construct the longest segment of 20 kilometers. Even that project is uncertain,” the official added.

A spokesperson for Access, also speaking on condition of anonymity stated that it had decided not to extend the contracts of at least 850 of its employees, when they expire during the next five to six months.

The current government halted several key projects that were commenced during the previous regime in order to review them. The Port City project, which was carried out by China Communication Construction Company (CCCC) Ltd, was one of the projects that were halted for reviewing purposes.

In addition, the government had also scrapped the Northern Expressway project and had amalgamated with the Central Expressway project. However, the commencement of the Northern segment is still doubtful due to focus given on the Colombo-Kandy expressway.

According to President, Chamber of Construction Industry (CCI) Sri Lanka, Deshabandu Dr. Surath Wickramasinghe, the construction industry has been the most affected since the new regime had taken over in January this year.

Speaking to The Nation Gain, Dr. Wickramasinghe stated that even though the government had halted several projects, including the Port City, it was unclear whether they would resume or completely stop.

“This has had a serious impact on labor, material and other costs related to the said projects. The material which had been brought to be used has been lying idle for several days now,” he added.

Secretary to the Ministry of Highways and Investment Promotion, U.R. Seneviratne speaking to The Nation Gain requested the construction agencies to be patient as several projects were in the pipeline. “We cannot divulge in detail the projects that are coming up. But we can assure that Sri Lanka will get construction projects, three times more than what we earlier had,” he stated.

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