They are asking for understanding regarding the health situation that has caused delays in the arrival of imported materials, which will mean that many projects cannot be delivered on schedule. Meanwhile, the president of the Shipping Association, Teddy Heinsen, said yesterday that due to delays in goods coming from one of the main ports, such as China, 35% of the cargo is delayed.
SANTO DOMINGO.- Many of the projects under construction will not be able to be delivered on time by the companies responsible for the works, given the ongoing delays in the arrival of imported materials and the burden of difficulties brought on by the pandemic.
The latest wave of COVID-19 has further worsened the freight situation, which was still struggling to recover from the crisis triggered by the pandemic. Now, Omicron has emerged, complicating a situation that has been affecting global trade for over a year.
“Certainly, COVID-19 and the variants of the pandemic, such as those occurring in the world and from which the Dominican Republic is not exempt, have delayed the construction of housing projects and this has deepened the difficulties of both national and imported materials, weighing heavily on the construction processes,” states Fermín Acosta, of Constructora Crisfer.
He explains that this situation affects everyone from construction companies and suppliers to contractors, who are also suffering the impacts of the pandemic. Therefore, "we hope that everyone involved in this activity—developers, buyers, and contractors—will be understanding and view positively the effort being made to meet commitments.".
Acosta understands that no company can offer a delivery date for the units because the sector has had to adapt to the situation, given the lack of imported materials in many projects, due to shipping line issues. "Many times the unit is ready but the materials aren't available, and we're at the mercy of the difficulties our suppliers face.".
Omicron invasion in construction companies
Although he currently has no staff affected by COVID-19, engineer Simón Durán of Inversiones SBDS and Esa Logistick, says that in his company 50% of the staff have tested positive for the virus and that the general foreman who coordinates the supply of materials was absent until last Thursday.
He believes the biggest problem is that wearing a mask in the construction sector is complicated, since workers become agitated if they wear one while working. “Imagine a bricklayer laying a block; it’s impossible with a mask on.”.
Regarding the Haitian nationals, he maintains that they did not travel to their country last December due to the difficulties in the neighboring nation, and many feared they would not be able to return.
SBDS Investments and Esa Logistics have the Quintas de San Isidro project in the pipeline, through which they will build 106 single-family home units, projected to be completed in 30 months.
COVID-19 and its direct impact
For Jochimin Pérez Iglesias of Constructora Jprez SRL, COVID-19 has had a direct negative impact on Dominican construction. Absenteeism has disrupted processes due to the fluctuating productivity caused by the lack of scheduled workers on site because of infections. The fear of the disease itself creates a climate of social distancing due to fear of contagion, he says.
It cites the economic crisis generated by the increase in maritime freight costs, resulting from the massive relocation of import orders to restock markets after the 2020 quarantine period.
“We are a country where the productive sectors depend heavily on the import of raw materials and finished products; construction is no exception. Imported products are involved in all the materials used in the finishing of a project, which is why the substantial increase in maritime freight has significantly affected their prices.”.
Pérez Iglesias explains that the finishing materials for projects are generally quite heavy, so the cost of shipping them can increase their price to up to four times their value. He says that in November 2020, a square meter of ceramic tile from China cost RD$280/m², but today it costs RD$1,000/m².
Many months late
“The pandemic has affected the execution and delivery time of projects for me by several months. First, there was the three-month shutdown, and when the construction sector was reactivated, it took 30 to 45 days for everything to flow normally again. So we're talking about four and a half or five months, and to this day we are still seeing the effects of freight and maritime cargo,” says Amel Rosario, from the Palmetto construction company.
He understands that the time a project might take to complete is unpredictable, given that it depends on the project's scale, the suppliers… “There are many things that could affect a project's performance. For example, Metaldom used to deliver cutting and bending orders in 14 days, now it takes between 28 and 31 days.”.
He said his company is experiencing a 20 to 25% staff absence due to flu, influenza, and COVID-19. He added that some Haitian nationals traveled to their country and have not yet returned.
Omicron causes supply chain bottleneck
The newspaper El Día reported yesterday that disruptions in the supply chain, failures in maritime logistics and production of international companies, will be occurring in the first months of this year 2022 as a consequence of the Omicron variant.
The president of the Shipping Association, Teddy Heinsen, told that media outlet that due to delays in goods coming from one of the main ports, such as China, 35% of the cargo is delayed.
He also indicated that the congested points will cause delays of at least three to six weeks for shipments to be sent from that port.
"We expected that in January, due to the reduced demand in the town, things would normalize a bit, but even so, the traffic jams and the imports coming from China will have to live with that delay; freight costs will be high for a few more months," Heinsen added.
