The development prospects of Malaysia's construction industry are greatly affected by policies, and demand for water reducers will also decline in the short term.

The development prospects of Malaysia's construction industry are greatly affected by policies, and demand for water reducers will also decline in the short term

In the rapid development of the Malaysian economy, various infrastructures have been continuously put on the list with the needs of Malaysia's economic growth. The construction industry in Malaysia has been developing well in recent years. However, as the new Malaysian government came to power, several large-scale construction projects were stopped or cancelled, bringing uncertainty to the development of the Malaysian construction industry.
As more large-scale infrastructure contracts are about to be issued during the year, the outlook for Malaysia's construction sector is useful in early 2018. According to the "In-depth Survey Report on the Malaysian Construction Industry 2018-2023" released by the Xinsijie Industry Research Center, it is estimated that the total value of Malaysian local contract awards will be between RM25 and 30 billion, including RM55 billion East Coast Railway (30% or the equivalent of RM16.5 billion worth of contracts will be issued to local operators) and the Pan Borneo Contract worth RM12.6 billion.
The RM40 billion MRT3 project and RM60 billion Malaysia-Singapore high-speed rail are expected to be tendered in 2018 and contracts will be awarded in 2019. Several large-scale engineering contracts will be issued in the next one to two years. The local construction industry can still rely on these contracts to develop in the future, so the construction industry has a bright future.
However, as the new Malaysian government came to power in May 2018, anti-corruption and economic restructuring became the focus of development. The government reviewed large-scale development projects. It is estimated that RM105.9 billion will be cancelled within two years. It was around RM15 billion, well below RM29 billion in 2017 and RM56 billion in 2016.
Domestic new construction contracts awarded by listed construction companies in the second quarter of 2018 totalled RM4.1 billion. Although they increased by 2% year-on-year, they were 10% less than the first quarter. New contracts in the first half of the year were only RM8.7 billion, which was also lower than the previous period—18 %. Only one of the new contracts exceeds RM400 million, namely the Kuantan sewage treatment station and water pipe contract.
There were fewer construction projects in Malaysia from April to June 2018 than in January to March, mainly due to the new government's cancellation of the Long-Singapore High-Speed Rail and MRT Line 3 (MRT3) and review of the East Coast Link Railway (ECRL) and MRT Line 2 ( MRT2) and LRT three lines (LRT3).
In terms of foreign business, although construction companies did not obtain any new international contracts in the second quarter, as the growth of the domestic construction industry slowed down, I believe construction companies will be more active in securing overseas projects. In the first half of the year, the total value of new foreign contracts was only RM149 million, a sharp drop of 87% year-on-year.
According to various statistics, Malaysia's construction and infrastructure will show a downward trend in the short term, the demand for concrete will also decrease accordingly, and the amount of water reducer indispensable in concrete will also decrease. However, with the continuous promulgation of new policies, the demand for construction and infrastructure in Malaysia will increase in the future, and the need for water reducers will also increase significantly. Luoyang Tongrun, as a stable water reducer supplier, we will always provide our customers with quality products. Welcome to consult the manager of our company's foreign trade department. Email:

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