PRODUCTIVITY. Construction generates more than 500,000 jobs, but has been stagnant for four years.
Construction has had eight consecutive semesters of decline in its percentage of GDP. Concrete actions are needed so that this reality begins to change in 18 months.
The construction sector has decreased, as a percentage of the Gross Domestic Product (GDP), for eight consecutive semesters.
With the rebound of the pandemic, there was a slight reactivation, but it was insufficient.
The low budget for public works directly hits 70% of the sector’s movement, which depends on state spending.
In its best times, thanks to the second oil boom, construction reached 10% of GDP, however, now it is at 6%.
Given this scenario, builders and real estate developers, under the umbrella of Positive Builders, they have established a Roadmap so that the next president does not make the same mistakes as Guillermo Lasso and can give a real boost to the sector.
“The construction reactivation It is vital to achieve the desired public security. We all want to combat insecurity and there is talk of a strong hand; but nothing will give results if you do not generate adequate employment conditions. A town that does not have jobs is going to necessarily dedicate itself to crime and we are going to fall again into that vicious circle of greater insecurity, less economic activity and less employment,” said Joan Proaño, representative of Constructores Positivos.
Real estate hub
The real estate sector represents 30% of construction activity throughout the country. The growing interest of Ecuadorians in having their own home must be promoted.
1 The first step must be, hand in hand with the endorsement of multilateral organizations, to obtain additional funding for the housing credit program with subsidized interest rates.
Public interest and social interest housing can currently be be financed with credit at less than 5% interest.
In 2018, during the Government of Lenín Moreno, a social bond with multilateral endorsement to be able to give that type of credit; but only 16% of mortgage operations have used financing with subsidized rates.
This is because most Ecuadorians do not know that it exists. The next president must get more resources for the initiative because the existing ones are exhausted in February 2026; But above all, it must promote the massive information campaign so that more people know that they can buy their house for up to $97,000 very cheaply.
2 Strategic alliances for the development of real estate projects, especially social housing and public housingwithin urban land.
As he National Government like BIESS have a lot of underutilized or unused land. Many of these lands are already provided with basic services and located in urban areas, but they have degenerated into wastelands.
The proposal is that the Government and the municipalities and prefectures make it easier for these lands to pass to the builders for development of real estate projects under full private sector risk.
3 Credit focused on providing liquidity to builders. The financial product is almost ready, but the next president will have to execute and promote it.
The objective is for the funds from the banks to go directly to the builder while the works are being carried out and not when the projects are finished.
This would energize the sector and would allow, among other things, people to buy flat-plan homes at a lower price.
Public works axis
A The first action, on which the execution and efficiencyis to put at the head of the Ministry of Public Works a person who knows the dynamics of the state and who also has technical knowledge of the work that must be carried out.
One of Lasso’s big problems is that he placed officials, from tourism businessmen to politicians, in positions that needed experienced engineers and builders.
In a few months, what is essential is a head that does not have to go through a long learning period and that can execute practically from minute 1.
B push one new public procurement law. A project in this sense was left at the door of the second debate in the Assembly, which was stopped due to the death of the cross. The new president must push for the new Assembly to address the issue as soon as possible.
The current legislation, in the opinion of Carlos Morán, builder and real estate developer, being cumbersome encourages corruption and poor execution.
Reforms should aim to create a clear and efficient system of prior reporting, which may even help prevent corruption.
As LA HORA has already published, steps can be refined that do not contribute to the hiring processes that currently can last several months and even prevent competition.
C Urgent creation of a technical table between builders and the National Public Contracting Service (Sercop) to change resolutions that hinder processes and make contracts more expensive.
D Prioritize spending on high impact and low cost works. The objective is to energize small and medium-sized builders with works such as local roads, health and educational infrastructure in the rural sector.
This prioritized spending must be combined with the promotion of all types of strategic partnership mechanisms and Public-Private Alliance (PPP) so that the private sector can supply what the State cannot finance.
E Create an independent team, inside or outside the Ministry of Public Works, to be exclusively responsible for managing the works that will be needed to face the impact of the El Niño phenomenon.
“We must move to true contingency plans, with financing and clear goals, and not replicate the outdated model of emergency plans where works are carried out in reaction to the disaster and where as builders we know that a lot of room is opened for corruption. ”, concluded Proaño. (J.S.)
Until August 2023, budget execution in public works did not exceed 50%