Financial Secretary Simon Wilson said yesterday he is not convinced there is any dramatic increase in the cost of construction material as a result of inflation and explained that government attempted to tackle rising costs in the construction sector by making certain items duty-free.
While there are those in the construction sector who have contended that costs in the sector are surging due to Russia’s war in Ukraine and ongoing supply chain issues, Wilson said he has not directly seen the evidence of it.
“I don’t think the numbers demonstrate that is true,” he said.
“We haven’t seen a dramatic increase in inflation of construction material. So, I don’t know if that’s true.
“That’s a statement made without the facts to support it. Plus, if you remember, in the budget, we reduced a whole range of building materials to duty-free, so immediately there was a decrease in the price level.
“What I’m saying is that I don’t think there is any evidence to show an increase in the price of the building material index.”
Wilson, who spoke on the sidelines of yesterday’s eProcurement portal launch, said while there are other factors that could lead to an increase in prices, such as the increase in fuel and shipping costs, the overall sector should not be affected to the degree being stated given the countermeasures put in place by the government.
Bahamian Contractors Association President Leonard Sands said recently that construction costs have increased by up to 30 percent.
However, Wilson insists the cost of building materials should begin to go down because of the interventions made by government.
The government reduced the duty on roofing materials, plumbing materials and electrical supplies in the budget.
Prime Minister Philip Davis said the changes “will make it more affordable for everyone in The Bahamas to undertake any construction project”.
Sands has argued that contractors have already had to absorb cost overruns on projects they have already quoted due to the rising costs of material.
He said the inflation in the sector is a worry for contractors and has affected business operations for several firms already.
