Construction industry calls for assistance amid rising costs due to Mideast war

2026-03-26 - 06:51

Master Builders Association Malaysia said geopolitical tensions in the Middle East have driven up material and energy costs in the construction industry. PETALING JAYA: Master Builders Association Malaysia (MBAM) has called on the government to provide immediate financial relief to the construction industry in light of rising costs due to the war in the Middle East. In a statement, MBAM president Oliver Wee said the construction industry was facing mounting pressure due to escalating geopolitical tensions in the Middle East which had driven up material and energy prices. He said the regional conflict has resulted in rising input costs, uncertain delivery timelines, and increasingly constrained cash flow across the industry. Wee called for soft loans and financial guarantee schemes, a reduction or deferment of taxes on construction services, the maintenance of diesel subsidies, and support for logistics costs. He also called for a fair and balanced contractual framework, including the introduction of mandatory variation of price mechanisms for key materials such as steel, cement, and fuel. He said there should be assurances that new fiscal policies or taxes will not be imposed on existing contracts, and called for stronger payment mechanisms to ensure timely certification and disbursement. Wee said supply chain stabilisation measures were also needed, including facilitating alternative sourcing through relaxed import requirements and expedited approvals. “The government should consider establishing strategic reserves for critical construction materials,” he said. Wee also called for project continuity measures, including recognition of extension of time entitlements arising from supply chain disruptions. “There should be temporary relief or moderation of liquidated ascertained damages for affected projects, as well as revisions and adjustments to ongoing government contracts where necessary,” he added. Wee also urged greater collaboration within the private sector, calling on all parties to adopt fair risk-sharing practices, facilitate open dialogue and negotiations, and ensure timely payments.