Embed Size (px)
Citation preview
THE CONSTRUCTION INDUSTRY IN YEMEN:
TOWARDS ECONOMIC SUSTAINABILITY
Basel M.K. Sultan
A thesis submitted in partial fulfillment of the
requirement for the degree of Doctor of Philosophy
Principal Supervisor:
Assoc. Prof. Stephen Kajewski
Associate Supervisors:
Prof. Tony Sidwell
Dr. Matthew Humphreys
School of Urban Development
Faculty of Built Environment and Engineering
Queensland University of Technology
2005
II
III
DECLARATION
The work contained in this thesis has not been previously submitted
for a degree or diploma at any other higher education institution. To
the best of my knowledge and belief, the thesis contains no material
previously published or written by another person except where due
reference is made.
Signed: ________________________
Date: ________________________
IV
بسم اهللا
This research is dedicated to my deceased mother. Also to
my loving wife who helped patiently create this document
and to my daughters Seham, Farah, Zenah and son Omer all
of whom are a constant source of pride.
V
ACKNOWLEDGMENT
I would like to express my sincere gratitude to the following people
without whose help this dissertation would not have been possible; my
principal adviser Associate Professor Stephen Kajewski for his
continued support, his incredible understanding and capability to initiate
guidelines without being overbearing. Also, I would like to thank my
associate advisers Professor Tony Sidwell and Dr. Matthew Humphreys
for their comments and discussions. I would like to show my
appreciation to all the staff in the School of Construction Management
and Property, in particular Professor Martin Skitmore and Denise
Redfern for their support and friendship; all my friends in Australia
especially Garry Creedy and his family.
I would like also to express gratitude to all my friends and colleagues in
Yemen for their enormous help in collecting the surveys and their
participation in the questionnaires. Their reviews, email discussions and
comments were very helpful. I would also like to thank all participants in
the local survey, and a special thanks to the panel of experts for their
contribution and valuable opinion. My deepest gratitude to my family,
Omar, Ahlam, my father, brothers and friends back home that always
stayed in touch.
Most of all I would like to thank my wife for her inexhaustible support,
and encouragement to finish my dissertations during the most difficult
times. She not only helped throughout discussions but also helped me
with her candid and sincere feedback over this dissertation.
VI
ABSTRACT
The construction industry is one of the most important components in the
economic development of a developing country, being a major contributor to the
national economy of many such countries. This industry is largely responsible for
the physical provision of housing and infrastructure and, as such, can be the
backbone of prosperous economies, providing social development and
employment.
The construction industry in the developing economy of Yemen is plagued by
difficult economic and technical problems, which permeate most aspects of the
industry. In addition, construction procedures in Yemen consume excessive
capital, time and resources that have a direct flow-on effect for the national
economy and the nation’s socio-economic development. Macroeconomic
problems in unemployment, inflation and an inequitable balance-of-payments all
add to the existing difficult economic situation in the construction industry.
Further, the lack of appropriate infrastructure, weak and inefficient legal,
administrative and financial institutions are also major contributors.
The recent global shift to sustainable development also requires that the
construction industry in Yemen initiate important strategic developmental
policies in order to meet future demand for economical and sustainable
development.
This research uses a comprehensive literature review to design and conduct a
survey into the existing local development barriers and then obtains a census of
expert opinions using the Delphi methodology to rank a set of sustainable
developmental policies and strategies. The research then establishes a
VII
comprehensive list of recommendations for achieving economicly sustainable
industry. Proposed policies and strategies are formulated from various
international studies, including Agenda 21 for Sustainable Development. The
proposed policies and strategies are specifically chosen as they are considered to
be compatible with the Yemen case and are also seen to more readily integratable
with cultural aspects of Yemen, particularly in focusing on the hardships of its
local needs and capabilities.
The construction industry in the developing nation of Yemen appears aligned in
many ways to the needs of other developing economies and, as such, it is
expected that the findings of this research will be of great interest to
professionals involved in the construction economies of other such developing
nations.
VIII
CONTENTS
ABSTRACT VI
CONTENTS VIII
LIST OF TABLES XVI
LIST OF FIGURES XVII
CHAPTER 1 INTRODUCTION 1
1.1 Project objectives 2
1.2 Research Hypothesis 3
1.3 Main contribution and limits of the research 3
1.4 Research methodology 4
1.5 Thesis organization 5
CHAPTER 2 SUSTAINABLE DEVELOPMENT AND CONSTRUCTION 8
2.1 Sustainable development 9
2.1. 1. World commission on environment and development (WCED) 12
2.1. 2. The Earth Summit in 1992 13
2.1. 3. Agenda 21 14
2.1.3.1 National strategies 15
2.1.3.2 Local agenda 16
IX
2.1.3.3 The global partnership 17
2.1.3.4 Agenda 21 for Sustainable Construction 18
2.1.3.5 Agenda 21 for Sustainable Construction in Developing Countries 20
2.2 Sustainable construction 21
2.2. 1. Unsustainable practices within the construction industry 23
2.2. 2. Energy, construction and design 24
2.3 Economic sustainability 25
2.3. 1. Economic challenges 28
2.3. 2. Expected Barriers to achieving sustainability 29
2.4 Summary 30
CHAPTER 3 DEVELOPING COUNTRIES AND THE CONSTRUCTION INDUSTRY 31
3. 1 Developing countries definition 32
3. 2 Role of construction industry in developing economies 34
3. 3 The relationship between the share of construction in gross domestic product (GDP) and the level of per capita national income
35
3. 4 The value-added in construction 36
3. 5 The contribution of capital formation 37
3. 6 Construction industry in developing countries 38
3. 7 Characteristics of the construction industry in developing countries 41
3.7.1 Instability 41
3.7.2 Relatively unskilled labour forces, 42
3.7.3 Low levels of productivity and overruns 42
X
3.7.4 Poor infrastructure 43
3.7.5 Fraudulent practices and inability to adopt best practices 44
3.7.6 Financing characteristics 46
3.7.7 Government influence 47
3.7.8 Informal sector activities 48
3. 8 Resources required by construction 49
3.8.1 The construction sector and employment 50
3.8.2 The construction materials in developing countries 51
3. 9 Summary 54
CHAPTER 4 YEMEN: ECONOMY AND CONSTRUCTION INDUSTRY 55
4. 1 Introduction to Yemen 56
4. 2 The economy of Yemen 58
4.2. 1. Manufacturing 59
4.2. 2. Oil and gas revenue 60
4.2. 3. Construction industry and the economy 61
4.2. 4. Labour and Employment in Yemen 64
4. 3 A brief history of the construction industry of Yemen 66
4.3. 1 Traditional construction in Yemen 68
4.3. 2 Modern construction in Yemen 69
4. 4 Building materials 70
4. 5 Infrastructure 71
4. 6 Local Contractors 72
4. 7 Law and construction contracts 73
XI
4. 8 Construction costs 74
4.8. 1 Construction cost, exchange rate and inflation 76
4.8. 2 Affordability and purchasing power 78
4. 9 Summary 79
CHAPTER 5 RESEARCH METHODOLOGY 81
5.1 Justification of the methodology 82
5.2 The scientific method and the research process 82
5.3 Definition of research methodology 87
5.4 Selection of research strategy for scientific engineering and construction management research 87
5.5 Surveys 92
5.6 Strategic Management 95
5.6.1 Poter’s model 96
5.6.2 SWOT 99
5.7 Consensus-forming techniques 101
5.7. 1. Interacting group process 101
5.7. 2. The nominal group process 102
5.7. 3. The Delphi process 102
5.7. 4. Comparisons of the different processes 103
5.7. 5. Advantage of the Delphi technique 104
5.7. 6. Evaluating criteria for methodology 105
5.8 Research methodology 106
5.8.1. Phase (i): Problem definition, research design and literature review 108
5.8.2. Phase (ii): Data collection, survey on the local 109
XII
construction industry of Yemen and analysis
5.8.3. Phase (iii): Ranking and validating the importance of the policies and strategies for economic sustainability and final documentation
111
CHAPTER 6 SURVEY ON THE LOCAL CONSTRUCTION INDUSTRY OF YEMEN 115
6. 1 Methodology 116
6. 2 The survey structure 117
6. 3 Analysis of responses from section (A) 118
6.3. A (1) Barriers to construction development 119
6.3. A (2) Lack of construction materials industry 124
6.3. A (3) Causes of high construction costs 126
6.3. A (4) Causes of construction wastes 130
6. 4 Analysis of responses from section (B) 134
6.4.B (1) Labour technologies and Employment in Yemen 134
6.4.B (2) Breakdown of cost by elements of building 135
6.4.B (3) Construction technology in Yemen 136
6.4.B (4) Formal and informal sector 138
6. 5 General findings on the survey 1138
CHAPTER 7 STRATEGIES AND POLICIES TO SUSTAIN THE ECOMOMY OF THE CONSTRUCTION INDUSTRY IN YEMEN GIES
140
7.1 Selection of appropriate policies/strategies 141
7. 1. 1 Labour-intensive policies 143
XIII
7. 1. 2 Energy-efficient Policies in design and construction 145
7. 1. 3 Credit and funding Policies on selected projects. 146
7. 1. 4 Local material protection policy 148
7. 1. 5 Strategies for sustaining affordable infrastructure projects 150
7. 1. 6 Law and regulations enforcement strategy 151
7. 1. 7 Pricing policies 153
7. 1. 8 Improve administration and institutional effectiveness and reduce all forms of bureaucratic procedures 154
7.2 Summary 156
CHAPTER 8 THE DELPHI METHOD FOR POLICY AND STRATEGY RANKINGS 158
8.1 Ranking of policies using consensus techniques 159
8.2 Delphi methodology 159
8 .2. 1 Background to Delphi 159
8 .2. 2 Suggestions for improvement 163
8.3 The selection of experts 164
8.4 The Delphi procedure 165
8.5 Tabulation of the first round responses 168
8.6 Tabulation of the second round responses 169
8.7 Assumptions for the policy ranking 170
CHAPTER 9 EVALUATION OF POLICIES RANKING 172
9. 1 Methodology and relative ranking 173
9. 2 Discussion of the ranking 175
XIV
9.2. 1. Labour-intensive construction policies 175
9.2. 2. Energy-efficient policies in design and construction. 177
9.2. 3. Credit and funding policies on selected projects 178
9.2. 4. Local materials protection policy 179
9.2. 5. Strategies for sustaining the continuity of affordable infrastructure projects 180
9.2. 6. Strengthening the law and regulations in construction and land affairs 181
9.2. 7. Pricing policies 182
9.2. 8. Improve Institutional and administration effectiveness and reduce all forms of bureaucratic procedures 183
9. 3 Summary 183
CHAPTER 10 CONCLUSION AND RECOMMENDATIONS 184
10. 1 Conclusion 184
10. 2 Recommendations 186
10.2.1 Proposed guidelines and suggestions to facilitate economically sustainable construction industry in Yemen 189
10. 3 Implications for further research 190
REFERENCES 192
APPENDICES 222
Appendix A-1 Socio-economic indicators for selected countries 222
Appendix A-2 Urban population (as % of total population) 223
Appendix A-3 Construction economy indicators cross comparisons 224
XV
Appendix B-1 Yemen socio-economic indicators 225
Appendix B-2 Relative Importance of Economic Sectors to Gross Domestic Product in Yemen for the Years 1994-1999 226
Appendix B-3 Status of the cement industry in Yemen 227
Appendix C-1 Letter for Survey on the local construction industry of Yemen stakeholders 228
Appendix C-2 Instructions for completing this survey 229
Appendix C-3 Results of survey 233
Appendix D-1 Letter for round one Delphi 236
Appendix D-2 Delphi round one questionnaire 2237
Appendix D-3 Delphi Round two letter 240
Appendix D-4 Delphi Round two questionnaire 441
Appendix E Pictures of Yemeni buildings 243
Appendix F Researcher’s background 248
XVI
LIST OF TABLES
Table 3.1 GFCF by Construction as % of Total GFCF 38
Table 3.2 Infrastructure Availability and Needs 44
Table 4.1 Construction in the Economy of Yemen 62
Table 4.2 Construction’s GDP as Percentage of Total GDP in some Developing Countries 62
Table 4.3 Average Contribution of Main Economic Activities 1990-2001 63
Table 4.4 Breakdown of Labour Force by Labour Category 65
Table 4.5 Employment in Construction 65
Table 4.6 The Construction Labour Costs 75
Table 4.7 The Construction Materials Costs (Yemeni Rial) 76
Table 5.1 Relevant Situations for Different Research Strategies 91
Table 6.1 Responses to the Development Barriers 120
Table 6.2 Responses to the Lacking of Building Materials Industry Development 125
Table 6.3 Responses to the Construction Cost Factors 127
Table 6.4 Responses to the Causes of waste 131
Table 6.5 Breakdown of Cost by Elements of Building for Housing (%) 136
Table 6.6 Breakdown of Cost of House Building by Elements of Cost (%) 137
Table 8.1 Delphi First Round 169
Table 8.2 Delphi Second Round 170
Table 9.1 Delphi Final Round results 174
XVII
LIST OF FIGURES
Figure 2.1 Sustainable Development Theme 12
Figure 4.1 Variation of Construction Cost in Local Currency (YR) with Time 77
Figure 4.2 The Variation of Exchange Rate (YR) with Time 78
Figure 5.1 Model of Scientific Method 83
Figure 5.2 The Empirical Scientific Research Cycle 85
Figure 5.3 Example of Empirical Strategies 89
Figure 5.4 Porter’s Model 97
Figure 5.5 Research Main Activities 107
Figure 6.1 Importance Index for Barriers of the Construction Development 121
Figure 6.2 Barriers to Local Building Materials Industry 125
Figure 6.3 Importance Index for Construction Cost Factors 1128
Figure 6.4 Importance Index for Construction Waste 132
1
CHAPTER ONE
INTRODUCTION
According to Agenda 21 for Sustainable Construction in Developing Countries
(CIB/UNEP-IETC, 2002) there is a sense of urgency about introducing
sustainable construction development into the developing world as:
• Firstly, the developing world is still under construction and every minute
means the construction of building, road, dam that will in all likelihood
not support the principles of sustainable development;
• Secondly, the pressures on resources in these countries mean that they
cannot afford to make mistakes and have to make sure that what is being
constructed now will be economically sustainable.
The Yemen construction industry is already having difficulties in coping with the
rapid growth in modern forms of construction. It is a country where construction
projects are often beset with severe problems. The construction industry in
Yemen may show some growth. but it does not appear to be developing in either
economic maturity or sustainability. The complexity of the problems in the
industry arises due to many reasons. Data such as economic performance,
management maturity, and industry methodologies is sorely lacking for the
industry. Research is desperately needed to establish such data before policy
2
recommendations can be made as to how the industry might develop and become
more economically sustainable.
The search for solutions to the current economic problems should focus on new
sustainable development policies, that can be alternatively selected or considered
in the construction industry activities, to attain some efficiency and economic
sustainability in compliance with the local capability. Within the construction
industry the public and private sectors are both responsible for developing and
implementing new strategies and policies for the attainment of sustainable
development.
In particular this research is planned in response to growing concerns regarding
the lack of an economically sustainable construction industry within Yemen and
other developing countries.
1. 1 PROJECT OBJECTIVES
The current situation of inefficiency necessitates the need for the use of technical
and economical policies and strategies, designed to initiate an improved
construction industry framework, efficient designs and construction materials
production, appropriate law and legal control, investment funding and pricing
systems.
The primary undertaking of this research is to examine the Yemen construction
industry and thus define the nature and performance of the industry, and the
industry’s contribution to the nation’s overall economy. The initial objective of
the study is to identify some of the development barriers that currently exist in
the construction industry of Yemen, by exposing the most common and
fundamental problems affecting the efficiency of the construction process and
economy of construction. Explaining why there are severe problems, paves the
way for speculating about how they might be overcome.
3
The second objective is to identify and rank a set of selected policies necessary
for stimulating and sustaining the economy of the construction industry.
1. 2 RESEARCH HYPOTHESIS
The process towards progressive and economically sustainable construction
industry in Yemen requires the introduction, initiation and implementation of
appropriate local polices and strategies.
1. 3 MAIN CONTRIBUTION AND LIMITS OF THE RESEARCH
This research has put together and analyzed for the first time, data on the
construction industry of Yemen, exposing the existing local constraints and
development barriers. The research raises awareness of the new era of
sustainable development and economic sustainability to the construction
industry, for the required process to implement policies and strategies into the
national economic planning and construction activities. A set of selected policies
was ranked as part of the proposed process.
In this study, the characterisation of Yemen’s construction industry was limited
to current and past activity levels, experience, prices and size of the industry to
other sectors and is based on data collection, surveys and experts’ opinions.
Although some observations and strategies were made with respect to economic
activities, they were assumed appropriate for the construction industry. This
research was not totally intended to create a precise or theoretical measure or
path as might be derived from a fully specified economic or physical model, it is
intended to close the existing gap between current construction practices and
economically sustainable development.
4
The research was also limited to low and medium technology infrastructure and
human settlement projects and materials production that are carried out locally.
Although the sustainable development agenda is a long-term strategy, this
research is narrowed to short and medium forecast requirements for the
transformation process.
1. 4 RESEARCH METHODOLOGY
The research approach adopted for this study comprises a combination of two
techniques. The initial methodology is in the form of a survey on the local
construction industry of Yemen, which is used for the identification of existing
issues in the construction industry and to answer the first principal research
question:
What are the real constraints hindering the development of the
construction industry in Yemen?
Findings from literature review, work experience and the survey of the local
construction industry guided efforts to the selection of appropriate policies to
improve the performance of the construction industry in Yemen.
The second approach used is the Delphi technique, which answers the second
principal research question:
How could the construction industry in Yemen achieve economic
sustainability?
5
The Delphi method; as a popular qualitative approach, is used to obtain the
consensus of opinion among a selected group of Yemeni experts, to rank the
policies selected for possible development requirements for the construction
industry to ensure economic sustainability.
1. 5 THESIS ORGANIZATION
The thesis follows the logical steps of setting up the hypothesis, developing the
method, gathering and analysing data and drawing conclusion. The thesis is
organised as follows:
In view of the fact that the purpose of the research is to investigate sustainable
criteria that will help the local industry to achieve economic sustainability,
Chapter 2 defines sustainable development, sustainable construction and
economic sustainability and briefly reviews the barriers for achieving local
sustainable development.
Chapter 3 gives a general background of developing countries and some of their
common characteristics. It briefly presents the characteristics of the construction
sector in developing countries. Problems and constraints in the development of
the construction industry in the developing countries are discussed. Literature
and data cover some developing countries, particularly those with low Gross
Domestic Product (GDP) per capita or as identified by international organisations
as Least Developed Countries (LDC). This chapter also outlines the role of the
construction industry in the economies of developing countries. Moreover, it
reviews the capacity of the construction materials industry and human resources
in the developing countries.
Chapter 4 gives an introductory background, to the economy and the construction
industry in Yemen. This chapter also records some development indicators and
other socio-economic indicators such as GDP and Purchasing Power Parity (PPP)
per capita and inflation. It provides an overview of economic issues of the
6
construction industry in Yemen such as the contribution of construction industry
spending to the GDP (%), Gross Fixed Capital Formation (GFCF), value-added
and gives cross comparisons with selected developing countries. This chapter
also briefly draws attention to the distinct traditional Yemeni buildings.
Furthermore, Chapter 4 points to the behaviour of exchange rates, construction
costs and affordability.
The methodology used in the dissertation is described in Chapter 5; this
methodology seeks to identify the barriers to the development and then ranks
selected policies required for attaining economic sustainability. This chapter
reviews strategic management techniques and the consensus-forming methods.
In Chapter 6 a survey into the local construction industry was conducted to
obtain data and provide insight into the current local obstacles. The survey
investigated the barriers to the local development and capabilities, taking Yemen
as study subject. The survey was structured to investigate various issues
experienced by the stakeholders, in order to gain a vision of the potential and
weaknesses of the local industry; this however should be fortified by the
observations found through the literature and local work experience. The
quantitative/qualitative survey targeted stakeholders who were involved in local
formal or informal construction activities, thus developing a consensus of
knowledge based on local participant. The outcome of the survey is also analysed
and discussed in this chapter.
Chapter 7 reviews a set of selected monetary, fiscal, technological, institutional
and administrative policies and strategies that can be used in developing
countries to stimulate and sustain economic construction development and
activities. These policies were generally intended to be inline with Agenda 21.
The policies and strategies selected for this dissertation are as follows:
• Labour-intensive construction policies;
• Energy-efficient policies in design and construction;
• Credit and funding policies on selected projects;
7
• Local material protection policy;
• Strategies for sustaining affordable infrastructure projects;
• Strengthening the law and regulations in construction and land affairs;
• Pricing policies and market control; and
• Improving institutional administration effectiveness and reducing all forms of bureaucratic procedures.
In chapter 8 the set of selected policies is examined and ranked. This chapter
further reviews the consensus-forming Delphi method. The Delphi methodology
employed in the ranking of the policies is discussed and the relative ranking of
policies is tabulated. The technique used a well structured and focused
questionnaire approach in order to establish a consensus opinion from local
experts. The Delphi method was selected for this research study for the purpose
of validating the importance of the list of construction industry development
strategies and policies, using a two round approach to answer the questionnaire.
The specific process followed is presented in detail in this chapter.
In Chapter 9 the ranking and evaluation of each policy is discussed in terms of its
validation and appropriateness for the Yemen case, according to their ranking
and affirmation by the experts in sequence of importance.
Chapter 10 is the concluding chapter which summarizes the issues raised by
application of the methodologies to the construction industry of Yemen and
suggesting changes that need to be made in future to help the construction
industry develop some economic sustainability. A set of recommendations that
will instigate development is formulated so that economic sustainability of
construction industry based on the available local techniques, materials and
human resources.
8
CHAPTER 2
SUSTAINABLE DEVELOPMENT AND
CONSTRUCTION
The construction industry, together with the material production industries which
support it, is one of the major global exploiters of natural resources. The industry
thus contributes very significantly to the current unsustainable development path
of the global economy (Spence & Mulligan, 1995). In spite of differing
perceptions and awareness about the precise meaning of the term sustainable
development, it is now generally agreed that development in the poorer nations
must proceed in parallel with a general global application of new technologies
that are both less resource-intensive and less environmentally damaging. The
development of the industry has become an international issue as indicated by the
UN Agenda 21 (1992) and CIB Agenda 21 (1999).
This research takes into consideration the means available to reduce the
economic impacts, through improved technology, design or changed practices
and it will suggest ways to promote these changes. This chapter defines
sustainable development and sustainable construction focusing on the
implications this approach has for the construction industry.
It is necessary to identify the key issues and challenges for the implementation of
sustainable development and construction in the developing world, as well as the
major barriers to practicing sustainable construction. This is necessary to create
9
the clear understanding that is required for the formulation of national strategies
and policies.
2. 1. SUSTAINABLE DEVELOPMENT
The built environment includes planning, designing, construction, operation,
maintenance and demolition; each of these has an impact on the environment and
the economy. These impacts manifest themselves both in the use of resources
and in what is released into the environment in the form of emissions, effluent
and debris. It is important to note however, the building process and construction
in general also contribute significantly to the development of national economies.
Initially, the concept of sustainable development attempted only to address the
conflict between protecting the environment and natural resources, and
answering the developmental needs of the human race; however, it was soon
realized that sustainable development would not be possible without certain
social and economic changes, such as a reduction in poverty levels and greater
social equity, both between people and between nations. It was also claimed by
Pearce (1996) that sustainable development could be seen as ‘a process instead of
a fixed destination’.
The most universally quoted definition for sustainable development is that
produced in 1987 by the World Commission on Environment and Development
(WCED), otherwise known as the Brundtland Commission (after its Chairperson,
Gro Harlem Brundtland, Prime Minister of Norway):
Economic and social development that meets the needs of the
current generation without undermining the ability of future
generations to meet their own needs.
Following the publication of the Brundtland Report there was a rapid escalation
of alternative definitions of sustainable development and lists were given by
10
several authors. In general, definitions involve two components: the meaning of
development (i.e. what are the main goals of development: economic growth,
basic needs, rights, etc.); and the conditions necessary for sustainability. Despite
the wealth of references to the Brundtland definition, it is not supported by
professional consensus. As Banuri (1999) observes there is professional
disagreement about this definition, not on how to put the idea of sustainable
development into operation, but to do with the question of definition. Sustainable
development has been variously defined as:
A pattern of social and structural economic transformations, which
optimises the economic and societal benefits available in the
present without jeopardizing the likely potential of similar benefits
in the future (Goodland and Ledec, 1987);
Fulfillment of human needs through simultaneous socio-economic
and technological progress and conservation of the earth’s natural
systems (Sage, 1998);
A development strategy that manages all assets, natural resources
and human resources, as well as financial and physical assets, for
increasing long-term wealth and well being (Repetto, 1986);
Improving the quality of human life while living within the
carrying capacity of supporting ecosystems (Caring for the Earth,
IUCN/UNEP, 1991);
Development that delivers basic environmental, social and
economic services to all residences of a community without
threatening the viability of natural, built and social systems upon
which the delivery of those systems depends (International Council
for Local Environmental Initiatives, ICLEI/IDRC/UNEP 1996)
11
Development efforts, which seek to address social needs, such as
housing while taking care to minimize potential negative
environmental impacts have been called sustainable development
(Hill and Bowen, 1997).
The statement from the World Conservation Strategy (IUCN/UNEP/WWF1,
1980), although frequently criticized for being concerned mainly with ecological
sustainability rather than sustainable development per se, appears to be the first
actual attempt to define sustainable development:
For development to be sustainable, it must take account of social
and ecological factors, as well as economic ones; of the living and
non-living resource base; and of the long-term as well as the
short-term advantages and disadvantages of alternative action.
According to Adebayo (2001), the Amsterdam Treaty’s (1997) definition of
sustainable development may meet favour within the African region because it
embraces the concept of integrated development within a contextual realm. This
definition sees sustainable development as:
Determined to promote economic and social progress for their
peoples, taking into account the principle of sustainable
development and within the context of the accomplishment of the
internal market and of reinforced cohesion and environment
protection, and to implement policies ensuring that advances in
economic integration are accompanied by parallel progress in
other fields.
1 International Union for Conservation of Nature and Natural Resources IUCN / United Nations Environment Programme UNEP /World Wide Fund For Nature WWF
12
Sustainability, as shown in Figure 2.1, consists of three broad themes, social,
environmental and economic. These themes are also known as the ‘pillars’ of
sustainable development.
Figure 2.1 Sustainable Development Themes
It proposes a model of human activity that explicitly includes environmental
considerations and the idea of allocating and conserving resources over time and
in a sustainable manner. Daly (1991) argued that sustainable growth, as stated by
Bruntland (1987), is not an appropriate term as it implies a quantitative growth of
the economic system that is a subsystem of a finite global ecosystem, which does
not grow; therefore, it is clear that growth of the economy cannot be sustainable
over a long period of time. Daly suggested that sustainable growth should be
rejected and instead sustainable development must be universally adopted since it
implies a qualitative improvement or better state of non-growing systems like the
economy.
2.1.1 WORLD COMMISSION ON ENVIROMENT AND
DEVELOPMENT (WCED)
The WCED was created in 1983 by the United Nations General Assembly as a
special independent organization with a total of 23 members from 22 countries, a
13
majority of them from developing countries (Silver & DeFries, 1990). The
commission mandate gave it three objectives (Brundtland, 1987):
• to re-examine the critical environment and development issues;
• to formulate realistic proposals for dealing with them; and
• to propose new forms of international co-operation on these issues that
will influence policies and events in the direction of needed changes; and
to raise the levels of understanding and commitment to action of
individuals, voluntary organizations, business, institutes and
governments.
After three years of studying the complexities and compatibility of economic
growth and environmental protection, the commission published in 1987 their
conclusions in a report ‘Our Common Future’. In this report the Commission
stated that the essential needs of vast numbers of people were not being met, and
warned that a world where poverty, inequity, and environmental degradation
were endemic would be inclined to ecological and social crises. The issues
discussed in the report were:
• global environmental decay;
• economic justice;
• the development of gentler, balanced, and stable relation with the natural
world;
• the limits to material and population growth;
• moral obligation to future generations; and
• equitable sharing of the world’s resources.
2.1.2 THE EARTH SUMMIT IN 1992
In June 1992, the United Nations Conference on Environment and Development
(UNCED) was held in Rio de Janeiro, Brazil. The conference, also known as the
Earth Summit, represented a follow-up to 1972 United Nations Conference on
14
the Environment (the Stockholm Conference), as well as the work done by the
WCED.
A period of intense planning, discussion, negotiation and compromise preceded
the UNCED, producing the following outcomes (Thom, 1994):
• Rio Declaration on Environment and Development;
• Agenda 21;
• Statement on Forest Management Principles; and
• United Nations Framework Convention on Climate Change, signed by
153 countries at UNCED.
The declaration contained a set of 27 principles governing the rights,
responsibilities and relationships of nations in the pursuit of sustainable
development through what was called “a new global partnership” (Malone,
1994). Some of the principles presented in the declaration included:
• All states and people shall cooperate to reduce poverty;
• States shall cooperate and operate in global partnership;
• The situation and needs of developing countries shall be given special
priority;
• States should enact effective environmental legislation;
• The precautionary approach shall be widely applied;
• National authorities should promote the internalization of environmental
costs. The polluter should bear the cost of pollution; and
• Indigenous people have a vital role in environmental management and
development.
2.1.3 AGENDA 21
Agenda 21 was the action plan for sustainable development for the 21st century
adopted by world leaders at the UNCED, and may well serve as a blueprint for
15
action. It is a strategic plan divided into 40 chapters, embracing 115 program
areas to be pursued by the global partnership during the 21st century in the
interest of sustainable development (Sitarz, 1993). Topics addressed in this
document included demographic pressure, agriculture, forests, fresh water
resources, the atmosphere, the oceans, toxic chemicals, hazardous and
radioactive waste, poverty, trade, human settlement and technology cooperation.
It also contained proposals for an institutional arrangement to ensure
implementation of the activities recommended for each program area, and
financial arrangements to underwrite their costs.
Unfortunately, many of the goals expressed at the Earth Summit, including those
of Agenda 21, still remain elusive (Beardsley, 1995). For instance, when the
climate convention took place in April 1995 in Berlin, only two or three
developed countries had any real chance of keeping their pollutant emissions
during 2000 to the levels of a decade earlier, the target vaguely endorsed at the
Earth Summit. Data available showed that the United States and Europe would
probably go 6% over that goal. In fact, in December 1997, in Kyoto, Japan, the
United States announced a rise in their emission of greenhouse effect gases of
3.4% over the level of 1996, which represents a total of 7.4% above the 1990
level (Lynch, 1997).
2. 1.3. 1 NATIONAL STRATEGIES
Agenda 21 called for the preparation of National Strategies for Sustainable
Development (NSSD). The Organization for Economic Co-operation and
Development (OECD) in its Shaping the 21st Century document (1996), set a
target of 2005 for “NSSDs” to be in the process of implementation in all
countries.
This document was adopted by the Development Assistance Committee (DAC)
Member Development Ministers and Heads of Aid Agencies at their meeting of
6-7 May 1996. It sets forth strategic orientations for development co-operation
into the 21st century. The report recalls the importance of development for people
16
everywhere and the impressive record of human progress during the past 50
years. It suggests a set of basic goals as a vision for the future, and proposes
strategies for attaining that vision through partnerships in support of self-help
efforts, improved co-ordination and consistent policies.
In 1997, the UN General Assembly Special Session set a target date of 2002 for
all countries to have introduced such strategies. Shaping the 21st Century
commits DAC members to support developing countries in the formulation and
implementation of “NSSDs” through a partnership approach.
2. 1.3. 2 LOCAL AGENDA
While it is agreed that we share a common goal for achieving a state of
sustainability, the developing world, with its great diversity of cultures, realises
there are different ways of defining and meeting this goal, and these can best be
determined at a local level. Similarly, the suggested actions have to grow from
local initiatives, making use of local strengths and addressing local barriers.
Chapter 28 of Agenda 21 specifically addresses the way in which local
authorities will implement this plan of action. Ensuring implementation at the
local level was deemed critical because ’so many of the problems and solutions
being addressed by Agenda 21 have their roots in local activities‘ (UNCHS,
Habitat, 2000). Chapter 28.1 calls upon local authorities to work with their local
communities to prepare Local Agenda 21 plans and local strategies for
sustainability by the end of 1996. Because so many of the problems and solutions
being addressed by Agenda 21 have their roots in local activities, the
participation and cooperation of local authorities will be a determining factor in
fulfilling its objectives, as local authorities construct, operate and maintain
economic, social and environmental infrastructure; oversee planning processes;
establish local environmental policies and regulations; and assist in
implementing national and sub-national environmental policies. As the level of
governance closest to the people, they play a vital role in educating, mobilising
and responding to the public to promote sustainable development.
17
International Council for Local Environmental Initiatives (ICLEI, 1997a, and
1997b) defined Local Agenda 21 (LA21) as:
A participatory, multisectoral process to achieve the goals of
Agenda 21 at the local level through the preparation and
implementation of a long-term, strategic action plan that addresses
priority local sustainable development concerns.
The implementation of LA21 action plans has resulted in improved municipal
service delivery, mobilization of community resources to address priority needs,
increased participation of civil society in urban planning, greater transparency in
municipal planning, and higher awareness within the community of the link
between environment, consumption patterns and quality of life.
This same process, which has been expanding worldwide for almost a decade,
also incorporates the use of indicators to measure and redirect action plans and
policies relating to sustainable development. Following UNCED 1992, local
governments, national and international local government organizations (LGOs),
and national bodies and UN agencies entered a period of experimentation with
the implementation of the LA21 concept. The lead actors in these efforts were
the local governments themselves, who worked, often with the support of their
national municipal associations, to develop the LA21 planning approaches
appropriate to their circumstances.
2. 1.3. 3 THE GLOBAL PARTNERSHIP
The environment has been perceived as an international issue, and ways of
attaining sustainability are becoming important for countries seeking sustainable
development. The international community has been active in developing policy
frameworks towards achieving the sustainability. Developing countries deserve
special attention in the effort to make sustainability an operative criterion in their
development activities. Given the difficulties that developing countries are
18
facing, their perceptions of the concept and principles of sustainability differ in
various contexts from those of developed countries, and the attainment of
sustainability is much more difficult (Chen & Chambers, 1999).
The environmental impacts of the construction industry are extensive,
particularly in developing countries. Therefore, the establishment of a global
partnership is important for the vision of sustainability to be realized and
operationalized around the world.
2. 1.3. 4 AGENDA 21 FOR SUSTAINABLE CONSTRUCTION
As there is a growing interest in sustainable construction, many researchers have
dedicated themselves to it. Many international organizations are now concerned
with the topic. As observed by Bourdeau et al. (1998) and Bourdeau (1999), the
International Council for Research and Innovation in Building and Construction
(CIB), the largest international organization concerned with construction, has
been very active in the field of sustainable construction.
CIB as the leading international organization for research collaboration in
building and construction recognized early the importance of environmental
concerns and commitment in all its multifaceted activities. In 1995 the decision
was made to take a definite step and make Sustainable Construction the focal
point of the three year period up to the 1998 World Building Congress in Gävle,
Sweden. The need for an internationally agreed Agenda on Sustainable
Construction to help guide the work of implementing the principles of
sustainability in the construction sector had matured and the 1998 CIB World
Building Congress was assigned a key role in this process. The Congress Theme
was initially defined as Construction and the Environment. CIB in partnership,
with other renowned international organisations produced in 1999 an Agenda 21
on Sustainable Construction with the purpose to give direction and point to
actions to be taken to reach the goal of sustainable development and an
environmentally sound construction industry.
19
The Agenda 21 on Sustainable Construction is intended to be a global
intermediary between those general Agendas in existence, i.e. the Brundtland
Report and the Habitat Agenda, and the required national and regional Agendas
for the built environment and the construction sector currently or in the course of
development. The three principal objectives for this Agenda 21 for Sustainable
Construction are:
• to create a global framework and terminology that will add value to all
national or regional, and subsectorial agendas;
• to create an agenda for CIB activities in the field, and for co-ordinating
CIB with its specialized partner organizations, and
• to provide a source document for definition of R&D activities.
Although CIB has recently commenced engaging with the developing world,
much more needs to be done. The 1998 CIB World Congress in Gävle provided a
good example of the gap in the sustainable development/sustainable construction
discourse. CIB Agenda 21 suffers from an understandable bias towards the
issues, challenges and solutions of the developed world. As indicated by Du
Plessis (1999):
• Little attention was devoted to people, social issues, and how the
construction industry and other actors in the built environment can
address the social requirements of sustainable development.
• The almost complete absence on the agenda of the developing world and
its problems
• The elitist nature of the problems addressed
• How little understanding there is of what sustainable development really
means
20
Du Plessis (1999) concluded that:
There is no way that we will be able to reach a full understanding
of the meaning of sustainable development without including the
world outside the privileged sphere of the industrialized nations.
Moreover, without understanding sustainable development we will
be unable to implement it successfully. The membership profile of
the CIB shows that the required open dialogue between the
developed and the developing world is still far from a reality.
2. 1.3. 5 AGENDA 21 FOR SUSTAINABLE CONSTRUCTION IN
DEVELOPING COUNTRIES
While there are many similarities between developed and developing countries,
the differences are even larger, the scope of the problems more extreme, and the
resources to deal with them considerably fewer. Furthermore, the level of
underdevelopment in developing countries may be cause for despair, but it also
provides an opportunity for development to avoid the problems experienced in
developed countries, by following a more sustainable development path.
Currently the construction industry operates in an unsustainable system. This
system disregards constraints to material and energy consumption.
As mentioned before in chapter 1, according to Agenda 21, sustainable
construction for developing countries (CIB/UNEP-IETC, 2002), there is a sense
of urgency about introducing sustainable construction practices into the
developing world; firstly, the developing world is still largely under construction
and every minute means the construction of a building, road or dam that will in
all likelihood not support the principles of sustainable development. Secondly,
the pressures on resources in these countries mean that they cannot afford to
make mistakes and have to make sure that what is being constructed now will be
sustainable in the future.
21
From the challenges identified in the Agenda 21 for Sustainable Construction in
Developing Countries, it is clear that to improve the quality of life for people in
developing countries, a number of critical issues have to be addressed such as:
• access to adequate housing and infrastructure;
• rapid urbanization; and
• informal settlement.
2. 2. SUSTAINABLE CONSTRUCTION
One-tenth of the global economy is dedicated to construction, operating and
equipping homes and offices. This activity accounts for roughly 40% of the
materials flow entering the world economy, with much of the rest destined for
roads, bridges and vehicles to connect the buildings (Roodman & Lenssen,
1994).
The First International Conference on Sustainable Construction in Tampa,
Florida, in 1994 addressed progress in the new discipline of ‘sustainable
construction’ or, as it has inevitably been called, ‘green construction’. By
extension, sustainable construction adopted the concept of sustainability and
related it to building and construction activities. Originally the term ‘sustainable
construction’ was proposed to describe the responsibility of the construction
industry in attaining ‘sustainability’.
Generally, the term sustainable construction has been used to describe a process
which starts well before construction in the planning and design stages and
continues after the construction team has left the site. It also includes managing
the serviceability of a building during its lifetime and extends to its eventual
deconstruction and the recycling of resources to reduce the waste stream usually
associated with demolition (Wyatt, 1994).
22
Sustainable construction was hesitantly defined (Kibert, 1994) as
Creating a healthy built environment using resource-efficient,
ecologically based principle’.
Sustainable construction is also seen as a way for the building industry to achieve
sustainable development. Sustainable construction as described by Du Plessis
(2002):
Means that the principles of sustainable development are applied
to the comprehensive construction cycle from the extraction and
beneficiation of raw materials, through the planning, design and
construction of buildings and infrastructure, until their final
deconstruction and management of the resultant waste.
Sustainable construction (EU, 2001; Watuka & Aligula, 2002) is the set of
processes by which a profitable and competitive industry delivers built assets
(building structures, supporting infrastructure and their immediate
surroundings), which:
• Enhance the quality of life and offer customer satisfaction;
• Offer flexibility and the potential to cater for user changes in the future;
• Provide and support desirable natural and social environments; and
• Maximize the efficient use of resources while minimizing wastage.
Sustainable construction can yield a number of social and economic benefits
including lower construction costs through material use and reduction and
savings on disposal costs because of recycling. Sustainability in construction
embraces not only procurement (new construction, refurbishment work and
maintenance) but also operation and demolition of constructed work. Watuka &
Aligula (2002) added that sustainable construction encompasses such matters as
23
tendering, site planning and organization, material selection, recycling and waste
minimization and extends to education for the new homeowner.
2. 2. 1 UNSUSTAINABLE PRACTICES WITHIN THE
CONSTRUCTION INDUSTRY
The construction industry affects the environment in different ways. First, it
consumes natural resources (both renewable and non-renewable) to produce the
physical built environment. Second, it generates wastes in the process of
transforming the capital and natural resources. Today’s approach to creating
cities, neighbourhoods, building and infrastructure is a source of perceived
negative effects on the natural environment and consequently on the economy,
the community, and the quality of life. Facilities and infrastructure systems are
designed, built and maintained creating the more evident problems in the
following areas:
• materials extraction and production (the expense of destruction of fragile
ecosystems);
• materials selection (toxic materials);
• material handling (inappropriate material storage waste, and inefficient
use);
• land use pattern (inappropriate; which contributes to the use of fossil
fuels, because building placement dictates much of our need for
transportation and other infrastructure systems like distribution network
for clean water and the water facilities, using fertile and appropriate
agricultural land to locate buildings and infrastructure;
• use of energy (inefficient, in terms of energy of materials construction
and energy of heating, lighting and equipment etc. );
• site work and design; and
• selection of construction technologies (equipment that pollutes and
deteriorate the air quality, and development without significant changes
in the built environment.
24
2. 2. 2 ENERGY, CONSTRUCTION AND DESIGN
The world’s commercial energy production has increased globally by 14% in the
last decade (WRI, 1992). In 1989, over 95% of the world’s commercial energy
was produced by the burning of fossil fuels; thus to the extent that the
construction industry uses commercial energy whether in the form of direct
fossil-fuel burning or the use of electricity, it is contributing to the depletion of
fossil fuels.
The construction industry is responsible for commercial energy consumption in
two principal ways (Spence & Mulligan 1995):
• Through the consumption of energy in the production of buildings and
other constructed facilities; and
• Through the consumption of energy in the subsequent use of these
buildings and facilities.
The energy in the production of buildings consumed subsequently is controlled
to a large extent by the eventual user. But the design of the building can also
have a major impact on the degree of their subsequent energy use; for example, a
building designed for air-conditioning is usually required to be air-conditioned
throughout its lifetime.
In general it has been found that energy consumption in the production of
buildings is a relatively small part of the total lifetime energy use, perhaps
10-15%. Even those aspects of the lifetime energy consumption which designers
can influence, such as heating and lighting, are controlled by the way the
building is used.
The energy used in the production, the so called embodied energy, is however
totally within the control of the construction industry, the designers, builders and
building materials producers. On site construction activity accounts for a small
25
but important proportion of the embodied energy in buildings, ranging from
about 15-25% of the total embodied energy. A major part of the energy use in
construction is related to the use of mechanical plant for site operations;
improvements in efficiency of this plant are often possible.
To some extent, construction efficiency also affects the total amount of embodied
energy in building, since inefficient site management can result in considerable
material wastage. The decisions of the builder may also dictate the sources of
supply of the materials used in building, and hence determine the transportation
energy component of the embodied energy.
2. 3. ECONOMIC SUSTAINABILITY
Economics is the study of allocation of resources among competing and
challenging users. In the past, the use and availability of labour and raw materials
was considered endless, but now it has to be sustained and the entire construction
industry must move towards sustainability. Economics, as it pertains to
sustainability, does not simply refer to Gross National Product, exchange rates,
inflation, profit, etc. Economics is important to sustainability because of its
broader meaning as a social science that explains the production, distribution,
and consumption of goods and services. Sustainable economy consists of sub-
themes, such as (Khalfan, 2000):
• Investment in people and equipment for a competitive economy;
• Job opportunities;
• Vibrant local economy;
• Services are accessible which reduces use of car, and vehicles;
• Creation of new markets and opportunities for sales growth;
• Cost reduction through efficiency improvements;
• reduced energy and raw material inputs; and
• Creation of additional added value, etc.
26
According to Khalfan (2000) sustainable development should not be at the cost
of spending more in order to achieve all the above-mentioned and much more.
Economic gain has been the driver for much unsustainable development in the
past. A shift to sustainability will only occur if it is shown not to be excessively
costly and disadvantageous. Part of sustainability is changing the way things are
valued to take into consideration the economic losses due to lost or degraded
natural resources, and expand the scope of concern from short term to long term
impacts. Once this is done sustainable development will be revealed to be a more
economically beneficial option than current development patterns.
The activities of the construction sector are vital to the achievement of the
national socio-economic development goals of providing shelter, infrastructure
and employment. The construction industry has the potential to enhance
economic sustainability through its structure, conduct and performance. An
economically efficient construction industry enhances economic sustainability by
ensuring lowest cost methods of construction, optimal allocation of resources and
discouraging wastes.
According to the first discussion paper for Agenda 21 for Sustainable
Construction in Developing Countries (CIB/UNEP-IETC, 2001), there is the
need to distinguish between technical2 and allocative3 efficiencies, given that a
market may be technically efficient, yet may not necessarily satisfy the allocative
efficiency criteria, especially where an equilibrium price remains unaffordable to
many outside the market. However, a technically efficient production process,
especially in a perfectly competitive market environment, should guarantee
competitive prices that can be passed to consumers in the form of lower product
prices. Furthermore, economic sustainability can be achieved within construction
2 Technical efficiency Those aspects of efficiency concerned with getting the largest possible outputs for given inputs, or the smallest possible inputs for given outputs. This is efficiency in production. 3 Allocative efficiency is the market condition whereby resources are allocated in a way that maximises the net benefit attained through their use.
27
when associated social and environmental costs are internalised and reflected in
the final product prices (CIB/UNEP-IETC, 2001).
The construction industry of developing countries is often very dependent on the
importation of construction components and materials; therefore, there is a direct
relationship between natural resource depletion and foreign exchange earnings
which are used to facilitate imports, including construction materials. Achieving
reductions in construction related imports through a sustainable construction
process would assist in reducing the environmental impact, especially
considering the resource intensity of conventional building materials. This is
particularly the case given the negative terms of trade between primary
commodities and manufactured products (Ebohon, 1996). This means that as
import prices increase and primary commodity prices fall, as is often the case,
real resources are constantly transferred from the developing countries to the
developed countries by having to export more primary commodities for less
manufactured products.
The key contribution of the construction industry to economic sustainability is
manifested through:
• sustained and efficient use of resources and materials;
• sustained employment opportunities through formal construction;
• sustained employment opportunities through material production and
distribution;
• sustained employment through related services like transport, financial,
marketing and rental/sale of property;
• sustained employment through operation and maintenance during the
economic life span of the buildings; and
• sustained investment and capital formation opportunities for the
economy.
Hill and Bowen (1997) indicated the obligation for economic sustainability to
28
• ensure financial affordability for intended beneficiaries;
• promote employment creation and, in some situations, labour intensive
construction;
• enhance competitiveness in the marketplace by adopting policies and
practices that advance sustainability;
• use full-cost accounting and real-cost pricing to set prices and tariffs;
• choose environmentally responsible suppliers and contractors; and
• invest some of the proceeds from the use of non-renewable resources in
social and human-made capital, to maintain the capacity to meet the
needs of future generations.
2.3. 1 ECONOMIC CHALLENGES
Sustainable construction faces economic challenges at different levels (Bon &
Hutchinson 2000). On the macroeconomic4 level, the goals of sustainable
construction are being implemented most actively in industrial countries in which
the share of construction output is decreasing. However in both less developed
and newly industrialized countries, the share of construction output is increasing,
but the goals of sustainable construction are more difficult to implement.
There are two broad approaches for meeting the economic challenges of
sustainable construction considered (Bon & Hutchinson, 2000):
• Governance through standards, legal and regulatory practices; and
• Market-oriented policies that influence the costs of particular forms of
construction.
According to Bon & Hutchinson (2000) both approaches have a role, but it is
argued that the market-oriented measures will be more effective at the strategic
level.
4 Macroeconomics The study of economic factors and their relationships to, for example, money, employment, interest rates, government spending, investment, and consumption
29
2.3. 2 EXPECTED BARRIERS TO ACHIEVING SUSTAINABILITY
The development of the construction industry has become an international issue
as indicated by Agenda 21(1992) and CIB Agenda 21for sustainable construction
(1999); therefore, it is necessary to identify the key issues and challenges for the
implementation of sustainable construction in the developing world, as well as
the major barriers to practising sustainable construction. This needs to be done
through national strategies, research, implementation of recommendations, and
the monitoring of suitable indicators for construction development.
A study conducted in 1998 by the Division for Sustainable Development (DSD)
and International Council of Local Environmental Initiatives (ICLEI) focused on
this link and aimed to identify the main types of national barriers that affect the
success of LA21 processes around the world. There are six expected barriers to
Local Implementation of Agenda 21 (DSD and ICLEI, 1998):
• Private Market Barriers, where problems are caused by market failures
and externalities;
• Public Market and Finance Barriers, where problems are caused by
government influence over price signals and by the way public agencies
spend money;
• Legal and Regulatory Barriers, where problems are caused by rules and
regulations set by government;
• Jurisdictional Barriers, where problems are caused by the nature of
delegation of government responsibilities;
• Professional and Trade Group Barriers, where problems are caused by
standards, practices and agreements in labour markets; and
• Foreign Assistance Barriers, where problems are caused by impacts of
international development agency practices.
30
2. 4. SUMMARY:
The literature review in this chapter tries narrowing the knowledge gaps this
study addressing. Definitions of sustainable development are found primarily in
international development literature. Therefore, those definitions are intended to
define sustainable development, sustainable construction and economic
sustainability, to establish adequate vision and to know how appropriate are those
definitions are on what to consider and what are the expected constraints and
how the local potentials or to achieve sustainable economic development within
local industry.
Sustainable development refers to the fulfillment of human needs through
simultaneous socio-economic and technological progress and conservation of the
earth's natural systems. Sustainable world progress is dependent upon continued
economic, social, cultural, and technological progress.
For the purpose of this thesis, sustainable economic development is taken as an
investment in people and equipment for a competitive economy, job
opportunities, vibrant local economy, services are accessible which reduces use
of transport, creation of new markets and opportunities for sales growth, cost
reduction through efficiency improvements and reduced energy and raw material
inputs, creation of additional added value, etc.
To investigate the readiness, ability and process requirements to achieve
sustainable economic development within the construction industry, background
or state-of-the-art knowledge of the construction industries of developing
countries is required. The following two chapters of this research provide the
necessary knowledge and insight required in the later stages of this research.
31
CHAPTER 3
DEVELOPING COUNTRIES AND THE
CONSTRUCTION INDUSTRY
The construction industry in developing countries may be viewed as a sector of
the economy which is responsible for the planning, design, construction,
maintenance and eventual demolition of buildings and works. It is essentially a
service industry, obtaining its inputs from various sectors of the economy with
which it is interrelated and interlinked in complex ways. The importance of
construction to developing countries derives from its role in the generation of
constructed physical facilities and employment, which, in turn, plays a critical
and highly visible role in the process of development. In developing countries,
the difficulties and challenges in the construction industries are present alongside
a general situation of socio-economic stress, constant resources shortages and a
general inability to deal with the main issues.
Despite the construction industry facing many risks and challenges in developing
countries, governments have not provided incentives to develop their
construction industries or promote their growth. A report by the UNIDO (1993)
revealed how disproportionately little consideration is given to the construction
industry by development planners. In fact during times of crisis governments’
response is to cut public spending, as there is a general lack of understanding of
the sector’s contribution to national development and goals. Developing
countries are replete with examples of incomplete infrastructural work, housing
and factories, as planners underestimate the construction demand and fail to
maintain targets.
32
This chapter summarises the common characteristics of developing countries and
their construction industries and presents the role of the construction and
building materials industries in the economies of developing countries.
3.1 DEFINITION OF DEVELOPING COUNTRIES
In this thesis, the World Bank (1999) classification of developing countries will
be used. The World Bank (WB) classifies countries in one of four groupings on
the basis of (GNP) per capita; indexed to other measures such as poverty
incidence and infant mortality. These classifications are:
• Low-income country – per capita GDP5 of US$755 or less (64 countries);
• Lower-middle income country – per capita GDP income of US$756 to
$2995 (55 countries);
• Upper-middle income country – per capita GDP income of US$2996 to
$9265 (38 countries); and
• High income country – per capita GDP income of US$9266 or more (49
countries).
According to the World Bank, each year the boundary between the categories
rises with inflation, but few countries have actually shifted from one category to
another between the 1970’s and end of the 1990’s. Appendix A-1 and appendix
A-2 give some socio-economic indicators for selected countries from low and
low-middle income countries.
Some of the similarities between developing countries are described as follows:
• Literacy is low compared with that in developed countries. Much of the
education provided is ill suited and often irrelevant to the needs of a
developing country. This is closely related to the skill level, not only of 5 GDP per capita real A country's real GDP per member of the population
33
the labour force, but also of the management personnel in developing
countries (Wells 1986).
• High population growth and high rates of unemployment. High rural to
urban population migration and failure in many developing countries to
provide the necessary infrastructure and building needs associated with
this rapid urbanization (Appendices A-1 and A-2). The United Nations
Centre for Human Settlement (UNCHS, 1996), for example, estimates
that more than 600 million people in the world’s urban areas are homeless
or living in life and health threatening environments.
• The general living standard for the vast majority of the people in
developing countries tends to be poor compared with that of more
developed nations. These living conditions and the overall economic
strength of the countries are shown by their total income and purchasing
power, which accounts for less than 27% of the world’s income, even
though these countries contain 76% of the world’s total population
(Todaro, 1997). Almost 40% of the population in developing countries
lives in absolute poverty. Most of the time their income is insufficient for
the provision of adequate nutrition (Todaro, 1985).
• Political instability: as opposed to political systems in developed
counties, the governments in developing countries face problems that
pose threats to their continuity and stability. They face political conflicts
that, in many cases, defy peaceful resolution. There are conflicts between
the state and private business and also between civilian and military
authorities.
There are also many other common characteristics in developing countries, such
as low health standards, reliance on foreign imports, unemployment,
underemployment and low levels of productivity.
34
3.2 THE ROLE OF CONSTRUCTION IN DEVELOPING
ECONOMIES
The construction industry is one of the key barometers of a country’s economic
performance. An important aspect of construction industry development is to
ensure that the industry contributes to the economy and stimulates activities in
other relevant sectors. Possible measures of the role of the industry in the
economy include:
• The size of the industry is substantial in terms of percentage contribution
of construction to GDP. It provides an appreciable share as its output
constitutes 7-10 % of GDP;
• Percentage proportion of construction to Gross Domestic Fixed Capital
Formation6. The industry is critical to infrastructure development and
provides a sizable contribution to fixed capital formation relative to other
industries;
• Value-added7;
• The share of investment devoted to entirely new construction is likely to
be higher in developing countries than in developed; and
• Construction is relatively labour-intensive in that it uses a larger number
of workers per unit output than most other industries, and as such is also
important as an employer. The industry employs 5-15 % of the labour
force in most developing countries (UNIDO, 1993).
6 Gross domestic fixed capital formation The part of domestic gross investment that consists of durable goods rather than stocks and work in progress. 7 Value-added The total sales minus purchases of inputs from other firms. What is left is available for the wages of its employees and the profits of its owners.
35
3.3 THE RELATIONSHIP BETWEEN THE SHARE OF
CONSTRUCTION IN GDP AND THE LEVEL OF PER CAPITA
NATIONAL INCOME
A number of authors who have investigated the relationship between the
construction sector and economic development have found a positive relationship
between the share of construction in GDP and the level of per capita national
income. Turin (1973), Drewer (1980), Edmonds & Miles (1984) and Wells
(1986) have established a relationship between construction activity and
economic development. Most of these studies found a positive correlation
between GDP per capita and various measures of construction output, and indeed
many studies found a linear relationship existed between construction as a share
of GDP (measured as value-added in construction) and GDP per capita. Turin
(1973) found there to be a strong positive correlation between value-added in
construction as a percentage of GDP and per capita GDP.
Evidence presented by Lopes (1998) indicates that a long-term decreasing
growth in GDP per capita corresponds directly with a relative decrease in
construction volume but that the converse does not appear to be true. In countries
where GDP per capita increased, the construction volume increased. On the other
hand, in countries that had a decreasing growth in GDP per capita in the same
period, the construction volume decreased (Lopes, 1998). The exception in this is
Mozambique, where there was an absolute increase in construction volume (due
to financial funds channelled by international bodies since 1987) but not an
increase in the share of construction value-added in gross domestic product8
(Lopes, 1998).
Others (Turin, 1973; Wells, 1985 and 1986) found a direct relationship between
different measures of construction industry activity and GDP per capita. Wells
(1986) went further and found that if this relationship occurs in a country at a
given point in time, the share of construction in the GDP will increase with the
8 Gross Domestic Product The value of all goods and services produced in one country during the calendar year.
36
increase in national income per capita. The picture that emerges suggests that the
direct relationship between the construction sector and economic development is
more consistent with a downturn development pattern. That is, when countries
reverse the pace of economic stagnation or decline, the share of construction in
national output will grow faster than the GDP in the first stages of recovery.
When a certain level is achieved and countries enter a period of sustained
economic growth and development, the construction volume will grow, in
general, at the same rate of growth as GDP. Tse & Ganesan (1997) suggest that
the GDP tends to lead the construction flow not vice versa. It is possible that
expansion of construction activity is preceded by an increase in economic output,
with the initial effect felt largely within the construction sector and only
subsequently on the aggregate economy.
Turin (1973) stated that in countries where construction contributed 3–5% to
GDP, there is an implication that unless the construction industry grows faster
than the economy as a whole it might constrain national socio-economic
development. Han & Ofori (2001) confirmed this. Hillebrandt (1985) has also
stated that any reduction in purchasing power will similarly affect the
construction industry; moreover, if the output of the industry is down, total
investment is down.
3.4 THE VALUE-ADDED BY CONSTRUCTION
The direct contribution of the construction sector to a country’s national
economy can generally be measured in terms of the value-added by the sector as
a percentage of total GDP. The value-added is defined as the gross value of the
output of the construction sector minus the value of its intermediate
consumption. Intermediate consumption, in turn, is defined as the value of
purchases from other economic sectors for products and services, such as
building materials and transportation services, which are incorporated in the final
constructed facility (UNCHS, 1984a). The value-added by the construction
37
sector in developing countries is typically 3% to 8% of the GDP (Turin, 1973
and Wells, 1986).
The value-added in construction expressed as a percentage of the GDP varies
from one group of countries to another. Turin (1972, cited by Edmonds, 1979)
found that the percentage increases as per capita GNP rises. In countries with a
per capita GNP of $300 or less, the average value-added is 3% to 4 %. In
countries with a per capita GNP of $2,000 or more, the average value-added is
over 6%. In middle income countries, however, the average value seems to be
between 5% and 5½% of GDP, which suggest that the construction sector tends
to take off when per capita GNP rises above $300. Whilst the proportion of GDP
formed by the value-added in construction varies on average, over a small range,
the actual value-added per capita has a very wide variation.
3.5 THE CONTRIBUTION OF CAPITAL FORMATION
All products of the construction industry are regarded as ‘investment goods’ or a
part of fixed capital formation9. Construction involving building and civil
engineering projects usually accounts for about 50% of a developing country’s
gross fixed capital formation (World Bank, 1993). The output of the construction
sector constitutes a substantial proportion of 40% to 60% of the gross fixed
capital formation (GFCF) in every country (Turin, 1973; Edmond, 1979). This is
found in the construction of houses, hospital, schools, power stations, roads,
dams, ports and so on. For this reason alone (Turin, 1973), it is logical that the
development of construction industry should be high on the list of priorities for
economic planning.
As a high rate of investment (commonly more than 30% of GDP) is essential for
rapid economic growth, and as construction constitutes around 50% of this
investment, there is a close correlation between the level of a nation’s capital
9 Capital formation is defined as the transfer of savings from households and governments to the business sector, resulting in increased output and economic expansion.
38
formation, that is, new investment in fixed assets10, and its construction output.
The ratio of total GFCF to GNP tends to rise with the increase in per capita GNP,
so the share of investment in construction also rises.
The contribution to GFCF by construction11 as a percentage of the total GFCF of
the country, has ranged from 42% - 81%, as indicated in Table 3.1, for some
selected developing countries during the seventies (UNCHS, 1984a).
Table 3.1 GFCF by Construction as % of Total GFCF
1973 1977
Ivory coast 59 61
Kenya 54 42
Pakistan 81 71
Syria 57 48
Yemen 78 59 (1976)
Sources: (UNCHS, 1984a & Wells, 1986)
3.6 THE CONSTRUCTION INDUSTRY IN DEVELOPING
COUNTRIES
Construction encompasses all civil engineering works and all types of new
building projects (including housing), as well as the maintenance and repair of
existing facilities. In developing countries, as much as one half of total
construction output may be in civil engineering projects – transport facilities,
power projects, irrigation, drainage, water supplies, etc. Housing is generally
10 Fixed asset: A long-term, tangible asset held for business use and not expected to be converted to cash in the current or upcoming fiscal year, such as manufacturing equipment, real estate, and furniture. 11 GFCF by construction is defined to include residential building, non-residential building and other construction.
39
less than one third of the total output; the remainder is in other buildings –
hospitals, schools, offices, factories, hotels, and agricultural buildings (Wells,
1986).
In developed and developing countries, the construction industry plays a major
role in the economy by contributing significantly to the gross domestic product,
employing a sizable portion of the working population, accounts for about half of
the capital formation, and interacts strongly with other sectors of the economy
(Hillebrandt, 1985).
Thus, a healthy construction industry is considered as both a result of, and
prerequisite for, economic development. Adding to the importance of the
construction industry is its pivotal role in infrastructure development.
Infrastructure which is the base of both economic and social development can
become instead a bottleneck to economic expansion in developing countries
(World Bank, 1993).
The construction industry is cyclical in nature and one of the first industries to
feel the effect of an economic recession (UNIDO, 1993). These phenomenas,
along with financial and other business risks hinder the development of this
sector.
The construction industry is an important factor when economic policies are
formulated (editorial, 2002). Despite this, little attention is generally paid to the
construction industry by development economists and planners. Even where
reference is made to the role of construction in economic development it is
discussed either on the social level, that is, its contribution to improving the
standard of living, health, education, etc., or on the economic level, that is, its
implications for capital investment, rates of growth and the creation of
infrastructure. The significance of the construction industry as a mainspring of
economic growth is largely ignored (UNIDO, 1993).
40
The construction industries of all countries face many difficulties and challenges
(Gale & Fellows, 1990; Ofori, 1990); however, the problems facing the
construction industry in developing countries are infinitely more fundamental,
more serious and more complex. In developing countries, these difficulties and
challenges are present alongside a general situation of socio-economic stress,
chronic resources shortages and a general inability to deal with the key issues
(Ofori, 2000).
The problems and difficulties faced by construction industries in developing
countries and the expected measures to manage them, have been extensively
investigated and many studies and recommendations have been made for action
to address these difficulties (Ofori 2001, 1994; Turin 1973; Wells, 1986; World
Bank, 1984; ILO, 1987; UNCHS, 1981, 1984a). The governments of a number of
developing countries have implemented some of these recommendations,
however, results have been disappointing and the problems continue (Ofori, 1993
& Kirmani, 1988). Ofori (1994) commented on the lack of progress in
implementing these recommendations, claiming that it is due to the
inappropriateness of some of the recommendations and the initiatives adopted;
poor executive capacity of the implementing agencies; lack of resources for
implementation of initiatives; and neglect of the construction industry by
governments and their lack of commitment to solving its problems. Another
important possible reason for the lack of progress in construction industry
development is the absence of measurable targets in programmes for improving
the industry’s performance.
3.7 CHARACTERISTICS OF THE CONSTRUCTION INDUSTRY IN
DEVELOPING COUNTRIES
The construction industry, whether in developed or developing countries, faces
conditions of uncertainty and risk, sources of such risk are severe in developing
countries and include:
41
• Instability;
• Relatively unskilled labour forces;
• Low levels of productivity, overruns and excessive wastages;
• Poor infrastructure;
• Fraudulent practices, and the inability to adopt best practices;
• Certain financing characteristics typical in developing countries;
• Government influence; and
• Informal sector activities.
3 .7. 1 INSTABILITY
Construction is one of the first industries to feel the effects of an economic
recession (UNIDO 1993). This phenomenon, coupled with financial and other
business risks, makes the development of this sector difficult.
The construction industry of both developed and developing countries are
volatile; however, instability and volatility is more severe in developing
countries and resources are scarcer (Wells, 1986). Discontinuities and
fluctuations which characterize construction demand are also volatile in
developing countries (Moavenzadeh, 1984; UNCHS, 1984a). For this reason,
local contractors are not able to maintain and develop permanent supervisory
staff and skilled labour, nor can they establish an appropriate fleet of basic
equipment. Although clients (usually the government) may require the use of
local contractors to do the work, there may be very few qualified local
contractors available (Ruvkun, 1981).
3 .7. 2 UNSKILLED LABOUR FORCE
Construction activity in developing countries draws mostly on unskilled labour.
A reliable supply of labour will be affected largely by the seasonal demand for
agricultural labour (Coukis & Grimes, 1980). Some developing countries
promote labour-intensive construction to provide social and economic
42
advantages for the population, even though this procedure might hinder the
quality and completion of the construction project (Coukis & Grimes, 1980).
Although labour is abundant in developing countries there tends to be a shortage
of skilled labour (Moavenzadeh, 1984).
3 .7. 3 LOW LEVEL OF PRODUCTIVITY AND OVERRUNS
In addition to the lack of available skilled workers in developing country labour
markets, the quality of labourers is also an issue. Simpson (1987) found that
levels of labour productivity are extremely low in developing counties.
Research into construction projects in some developing countries indicates that
by the time a project is complete, the actual cost exceeds the original contract
price by 30% while change orders result in an 8.3% cost overrun (Al-Momani,
1996). Both housing and public buildings experience delays in completion and
face constant modifications as work progresses. This has proven to be a serious
and very expensive problem in Jordan’s construction industry (Al-Momani,
1995).
The successful execution of construction projects, keeping them within estimated
cost and the prearranged schedules, primarily depends on the existence of an
efficient construction sector capable of sustained growth and development in
order to cope with the requirements of social and economic development and to
utilize the latest technology in planning and execution. Adequate planning at the
early stages of a project is crucial for minimizing delays and cost overruns
(Chalabi & Camp, 1984).
3 .7. 4 POOR INFRASTRUCTURE
Even if workers were highly skilled, getting them to construction sites would
often be problematic. In every country, continuous traffic delays and road
deterioration affect the delivery of materials and personnel to construction sites
(World Bank, 1981). In general poor infrastructure reduces productivity.
43
According to the World Bank (1997), up to 15% of production is lost between
the farm gate and the consumer because of poor roads and storage facilities. This
has the effect of reducing incomes to farmers and raising costs to urban
consumers, thus militating against prospects for industrialization.
Where the infrastructure system is undeveloped and weak, as is the case in many
Sub-Saharan African countries, the bulk of the population is isolated in rural
areas. Economies in the region have consequently remained characteristically
poor with low productivity performance and low income. According to a survey
of foreign investors in five East African countries (Ethiopia, Eritrea, Kenya,
Tanzania, Uganda), about 65% of the respondents reported to have ranked the
current state of infrastructure in the countries as a serious constraint in their
future operations in the region (Economisti Associati, 1994, cited by Zawdie &
Langford, 2002). Table 3.2 gives an indication of the severe shortages of
infrastructure in low income countries.
Table 3.2 Infrastructure availability and needs
Source: UNEP 2003
44
3 .7. 5 FRAUDULENT PRACTICES AND THE INABILITY TO
ADOPT BEST PRACTICES.
Elinwa & Buba (1993) stated that the cost of materials, fraudulent practices and
kickbacks, and fluctuations of material prices are three of the most important
factors leading to high construction costs in Nigeria. Contractors, therefore, may
need to increase their budget to allow for ‘hidden taxes/costs’ in developing
countries. Further, the system of competitive bidding does little to alleviate the
constraints. In theory, the system of accepting the least cost bid should encourage
efficiency; however, contractors, particularly small ones, have very little room
for manoeuvre in pricing a tender. The design is fixed, the cost of the material to
be used is fixed and hired rates of equipment are fairly standard. A contractor
therefore makes profit by limiting overhead costs, raising labour productivity,
and/or rationalising site organisation.
For the small contractor in developing countries there is not much choice.
Overheads are probably already pared down to the minimum and will generally
draw on the same pool of labour as all other small contractors. This leaves only
the possibility of more effectively managing site operations; moreover, the price
of the contract will already have been calculated by the client, and its amount is
often known to the contractors.
More fundamentally, small contractors often have difficulty in obtaining credit.
As a contractor is generally paid when the job is completed, and sometimes not
for a while after, there is a permanent cash flow problem and unless adequate
credit can be obtained, the contractor will be unable to finance construction
work. The contractor is often obliged to post various bonds which guarantee
execution of the work if given the contract, pay labourers and materials suppliers,
and rectify and repair any shortcomings in the finished work. In addition a
contractor will often have to take out insurance in order to cover various
liabilities.
45
A survey of small contractors in Kenya (ILO, 1987) provides a fairly typical
picture of the problems facing small contractors in most developing countries.
Essentially, the contractors find themselves caught up in a succession of
interlocking vicious circles:
• To obtain a contract they need fixed assets, but to obtain these they need
credit, which is not forthcoming unless they are on a government tender
list or already have a contract.
• To carry out contracts efficiently they need a reliable permanent labour
force, which they cannot afford unless they have some continuity of
work. On the contrary they will only be awarded contracts if they can
prove that they are efficient in the completion of jobs they have already
done.
• To become viable and stable they must increase their fixed assets, and
this can only be done if they have sufficient profits to reinvest in the
business. As they have no continuity of work and no assurance that jobs
will become available, the retained profits are diverted to fixed overheads
and not invested in plant and equipment.
• The smaller the firm, the greater its reliance on casual (generally
unskilled) labour; hence the higher the probability that its standard of
work will be inadequate, and thus damaging its prospects for further
work.
• The contractor has to pay material suppliers, employees and plant hire
companies promptly, whereas there can be long delays in receiving
payments due to the contractor. The cash flow deficit has to be covered
from the firm’s resources, again limiting the amount that can be reserved
for fixed assets.
46
• Small contractors cannot afford or obtain credit for the purchase of plant
and equipment. As a result they are often trapped in a sequence of
inefficient technology, leading to low productivity, leading to low
income, leading back full circle to inefficient technology.
• In contrast the large contracting firms which are often foreign owned are
well versed in the procedures governing the industry and also have little
difficulty in providing the necessary bonds and guarantees. It is not
surprising therefore that they obtain the major share of construction work.
3 .7. 6 FINANCING CHARACTERISTICS
In developing countries, large projects are usually funded through loans from
international agencies or developed countries’ governments and investments
from private firms based in other countries (Zuvekas, 1979).
The most important sources of multilateral finance for construction projects are
the World Bank and the International Monetary Fund (IMF). These institutions
lend funds at interest rates below those charged by other private lenders and
some times at no interest (Zuvekas, 1979). Other international lending agencies
include the United Nations represented by organisations such as the World
Health Organization (WHO), International Labour Organization (ILO), United
Nations Industrial Development Organisation (UNIDO) and United Nation
Centre for Human Settlement (UNCHS). These agencies fund heath centres,
education infrastructures, and affordable housing settlements.
3 .7. 7 GOVERNMENT INFLUENCE
The governments of developing countries generally set the rules for the
development of contractual relationships, thereby influencing the public
construction sector. The private sector also feels this influence through policies
and legislation, regarding licences and permits, sanitary and building codes,
minimum wage rates, corporate taxes, rules on importation of materials, and
47
terms and availability of financing for construction (World Bank, 1984).
According to the World Bank (1984) while the construction industry in
developed countries is affected by political institutions, it is not as strongly
affected as in developing countries. Contractors may, therefore, need to exercise
caution, accept greater levels of risk, and purchase additional insurance to cover
possible losses.
Government responsibility to ensure that improvements are made to the
construction industry is best done by:
• encouraging local contractors to increase their capabilities; and
• by enlarging the capacity of local material industries.
To achieve some of this, Andrews et al (1972), and Hillebrandt (1997)
recommended that labour-intensive types of construction should be chosen so
that the abundant unskilled labour could be used, thus economizing on imported
equipment and materials. Moreover, Hillebrandt (1997) recommended that large
projects should be broken down into smaller jobs to enable medium-size
contractors to gain experience on projects that they could handle.
3 .7. 8 INFORMAL SECTOR ACTIVITIES
The informal sector is defined as the unorganized and unregulated sector of the
economy. The difficulty in having access to housing development elements such
as land, building materials and credit facilities have resulted in a proliferation of
informal settlement (Erguden, 2001). In developing countries, the problem is
compounded by the fact that a large percentage of construction activity is not
executed within the formal sector of the construction industry (Wells, 1985), but
takes place on the fringes of the monetary economy, either by self-help or paid
labour in the informal sector.
48
The informal sector is defined by CIB TG 2912 (1998) as:
‘unregulated and unprotected individuals and enterprises engaged
in economic activities in construction including the supply of labour
and production of building materials and components for both the
formal construction sector and directly in response to client needs’.
The World Bank (1984) also defined the informal sector of construction as self-
help activity assisted by individual jobbers and builders, often itinerant. The
informal construction system is a method of organizing the production of
buildings without the involvement of contractors. It is characterized by a close
relationship between owner and building workers. The building owner supplies
the materials and the building process is often incremental.
According to Tassios (1992) the characteristics of the informal sector are:
• Low quality of construction output;
• Instability;
• Resistance to progress and change; and
• A considerable inertia in using modern materials and/or techniques.
Kenya in 1976 showed that the construction activities of the traditional informal
economy contributed almost 60% of the capital formation by all construction for
that year. In Kenya and the Ivory Coast in 1970s, the informal sector covered
almost one third of the total value of the construction sector (Tassios, 1992). In
the Ivory Coast it was estimated that in 1971 the informal sector counted for 30%
of the value-added by the total construction sector, 39% of the intermediate
consumption of materials and services, and 35% of the total value of the output
of the construction sector (UNCHS, 1984a). Also in Kenya, the informal
construction sector provided 30% of the total GDP of construction from 1969-
1978. While the informal sector’s share of GDP declined from a high of 46% in
12 Task Group 29 (TG29) on Developing Countries of the International Council for Research and Innovation in Building and Construction (CIB) was formed in 1997.
49
1964 to a low of 25% in 1972-74, it has remained around 30% since then
(UNCHS, 1984a).
3.8 RESOURCES REQUIRED BY CONSTRUCTION
Construction industries in developing countries need resource inputs such as
building materials and supplies; labour of various types and levels of skill;
equipment; and finance. It was found, for example, that the intermediate
consumption of materials and supplies ranged from 37% to 55% of the total
value of construction output, and that wages and salaries paid to construction
labour accounted for another 19% to 27% in most developing countries
(UNCHS, 1984a).
The major constraint to full capacity utilization appears to be (UNCHS, 1984a):
• A lack of efficient demand to support the existing capacity;
• Difficulty in sourcing materials;
• A lack of operating capital as the main financial problem;
• Labour problems, particularly in the supervisory and higher skilled labour
categories, were the fourth area of major constraints; and
• Uncontrolled activities by the informal sector.
3.1 THE CONSTRUCTION SECTOR AND EMPLOYMENT
The construction industry in developing countries employs 2% to 9% of total
national employment (UNCHS, 1984a). This excludes the employment
opportunities created in other industry sectors with which the construction sector
has strong backward linkages. Some developing countries have benefited from
the exportation and migration of labour, to the extent that overseas earnings
remitted contributed to the balance of payments. On the other hand, if the drain
on the domestic labour force is excessive, it can hinder domestic capital
formation and growth.
50
Hillebrandt (1999) indicated that there is always an appeal for countries with
high unemployment to use labour-intensive technologies; this is represented by
the economic concept known as the expenditure multiplier. The expenditure
multiplier is known as the number by which a change in expenditure must be
multiplied in order to determine the resulting change in total output or GDP
(Samuelson & Nordhaus, 1995). When a person is employed, that person
purchases goods and services from other sectors of the economy which, in turn,
generate employment and spending elsewhere, thus starting an upward spiral of
increasing employment.
Hillebrandt (1999) also added that there is an employment multiplier. This can
be defined as the number by which an initial change in employment must be
multiplied in order to determine the resulting change in total employment in the
economy as a whole. As construction in all countries is relatively labour-
intensive, even with fairly sophisticated technologies, expenditure on
construction generates a high level of employment, first in construction and then
in the economy as a whole. If the technologies used in construction are labour-
intensive, the employment multiplier will be even greater.
Major studies of employment generation from construction activity in Sri Lanka
have been undertaken by Ganesan (1994) who concludes that a significant gain
in total employment, of the order of 10% to 15%, can be realised through
industrial restructuring alone through the use of more appropriate technology. A
strategy to increase output through activities consuming more labour and less
scarce resource is the only feasible way forward in most developing countries.
Similar conclusions have been reached by others (Edmonds & Miles, 1984;
World Bank, 1984; Edmonds & De Veen, 1992; Gaude & Watzlawick, 1992).
3.2 CONSTRUCTION MATERIALS IN DEVELOPING
COUNTRIES
51
The definition of construction activity in most national income accounts is
expressed as the value-added by construction and generally includes only labour
costs, overheads and profit. This definition is rather narrow, as others have
indicated (Drewer, 1980; Wells, 1986). Value-added by construction is only a
small part of the total construction process; a large percentage of total
construction output consists of intermediate inputs from other sectors of the
economy, mainly the building materials.
The backward linkages of the construction industry to other industries are quite
strong and in fact represent a value, which in most cases exceeds the value-added
by the construction sector itself. In developing countries the average value-added
by construction accounts for 45% of total output value, and that intermediate
consumption accounts for the remaining 55% (UNCHS, 1984a). The importance
of the subject is that 50% to 60% of the total costs of dwellings are for building
materials.
The widening gap between construction needs and the domestic materials
production has inevitably led to increased import dependence by developing
countries. For developing countries as a whole, the total value of imports of
building materials increased, in real terms, by 85% between 1975 and 1985
(UNCHS, 1993).
The UNCHS (1985) observed that the construction industry in most developing
countries had inadequate capacity, high costs and were import dependent while
failing to utilize local resources. The construction industries of developing
countries are also heavily dependent on imports of materials, which account for
50% to 60 % of the cost of the construction output. It has been estimated that to
reduce this reliance by half would require the total investment in construction to
be doubled (UN, 1967 cited by Edmonds 1979).
Turin (1967) estimated that building materials constituted some 6% of total
imports in Africa, and observed that the suitable exploitation of the abundant raw
materials by the building materials industry on the continent, would considerably
52
reduce construction costs and have a multiplying effect on national economies.
Turin (1973) emphasised the use of public sector’s sizable demand for
construction to stimulate the production and use of local materials, the removal
of restrictions on the use of such materials in building codes, and changes in
designers and users’ attitudes towards them. Ganesan (1979) urged governments
of developing countries to include their construction industries in the formulation
of plans for industrialisation of their economies.
Studies on the construction industries in Africa have, for three decades, advised
the countries to reduce their reliance on imported materials and to develop and
use local materials. The economic commission for Africa (1965) (cited by Ofori
1985) observed that building materials industries were undeveloped, failed to
meet demand and operated with high costs in inefficient plans, with few skilled
technical and managerial personnel.
Emphasis was put on the local production of the conventional materials (cement,
steel reinforcement, roofing sheet, paints, etc.) to reduce costs, shorten delivery
time and remove uncertainties of supply. As economic conditions deteriorated,
however, the emphasis was put on the development of alternative materials using
local inputs, and on labour intensive methods of construction. For example, in
Ghana, about 60% of all materials used were imported in their finished form or
as raw materials, with imports of materials for construction accounting for 10%
to 20% of the total import bill (Ofori 1985). The materials to be produced in the
short term should include cement, lime, pozzolana, clay bricks, tiles and timber.
Turin (1967) observed that in many African countries a satisfactory human
environment in urban areas could be obtained at half the present cost. Wahab
(1990) also noted that Nigeria is blessed with many raw materials that could be
easily transformed into new building materials, affordable by its teeming
population. Wahab stated that Nigeria does not have to spend its reducing foreign
exchange earnings on importation of building materials to satisfy a taste acquired
during the oil boom.
53
It should be noted that most developing countries have to date followed a policy
of import substitution in the building materials industry. In practice this means
the establishment of local industries to produce materials identical to those
previously imported (import reproduction). The local reproduction of previously
imported materials and components generally means that raw materials used in
the production process continue to be imported, as does machinery and
equipment which are capital-intensive and require large quantities of (imported)
fuel, spare parts and technical assistance for operation and servicing. Hence the
local production of building materials in the developing countries has all too
often amounted to little more than substitution of one kind of imported materials
for another, with little use of local labour or development of locally available
materials (Wells, 1986)
With low technical level, limited foreign credits and inadequate internal
transportation systems, more flexible small-scale production units were proven to
be efficient, especially for local traditional materials (Tassios 1992). Thus, the
approach of cheap local material and small-scale production units should be
enhanced.
Since building materials are not the end products and are used by the
construction industry, the building materials industry can not be considered
separately from the construction industry. The strategy for the low-cost building
materials sector should reflect the forward and backward linkage with other
sectors of the economy and with the construction sector in particular. In fact, this
is a fully complementary policy, compatible with the use of more industrial high
performance materials; if not, there will be a tendency to waste expensive
materials in low-performance uses. The example of Portland cement used in
masonry works, foundation or in plastering, is both technically and economically
wrong. In this respect, in several developing countries, special masonry cements
were developed, leading to cost reduction as high as 30% or even 50% (Tassios,
1992).
3.10 CONCLUSION
54
This chapter introduced and highlighted common issues, key problems and
impediments in the construction industry of developing countries. It also
provided a ‘preamble of logical progression’ which can be used as a roadmap for
the proceeding chapter. It looks at specific issues arising from the body of
knowledge developed in previous studies on construction industries in
developing countries and related disciplines. This is regarded as important
knowledge for the assessing the construction industry in Yemen.
International and foreign data literature was predomantly used mainly due to the
limited domestic articles and, government publications. The preceding issues
discussed are typical in many developing countries and these make Yemen a
suitable candidate for the case study.
55
CHAPTER 4
YEMEN: ECONOMY AND CONSTRUCTION
INDUSTRY
In the early nineties, the economic and social conditions in the country started to
deteriorate noticeably due to many factors but mainly due to the reunification of
Yemen in May 1990, which caused more confusion and difficulties in combining
the two different governments. Some of the specific difficulties associated with
the Yemen construction industry are summarized by high construction cost,
unstable prices, inefficient planning and weak contribution to the socio-economic
development (Sultan & Kajewski, 2003b).
Back in the early 1980s a cooperative programme report by the United Nations
Industrial Development Organisation and the World Bank (UNIDO/World Bank,
1981) on the construction industry of Yemen, stated the inadequacies of building
materials, as well as inadequacies in design and project management potential
have been a hindrance, together with a lack of any approved national system of
codes, standards or specifications. The results are that construction projects are
often over-designed or inappropriate to local needs and priorities.
This chapter provides a general background on Yemen and the Yemeni
construction industry based on literature and empirical statistical data. Also this
chapter outlines the main economic issues in the construction industry in terms of
its value-added, size of capital formation, construction cost and employment, in
relation to the case of Yemen and some cross comparisons with selected
developing countries. This chapter is meant to add an understanding to Yemen
56
economic and technical potentials and cultural heritage, which will help in the
policy selection and instruments designs in later chapters.
4. 1 INTRODUCTION TO YEMEN
Yemen, situated along the south-eastern edge of the Arabian Peninsula, has an
area of some 531,870 square kilometres and an increasing population of over
18.5 million people (refer Appendix A-1 & B-1). Yemen’s future economic
development depends heavily on Western-assisted development of the country's
moderate oil resources. A low level of domestic industry and agriculture has
made Yemen dependent on imports for most of its essential needs. Once self-
sufficient in food production, Yemen has become a major importer (Breitschopf,
1999). Until recently and before the moderate oil exploration and production in
the late 1980s the primary economic activity was agriculture, employing about
60% to 70% of the workforce.
Yemen is considered one of the poorest countries in the world with a low
standard of public health and education, a high population growth rate of more
than 3%, a low degree of service accessibility and widespread poverty with an
estimated 35% of the population living under the household poverty line as stated
in the Country Strategy Paper (The European Commission EU, 2002). Yemen is
also ranked 148th out of 174 countries in 1999 and 2003 on UNDP’s Human
Development Index. Yemen is classified as one of the 64 lower-income counties
and within the 49 LDC (Least Developed Countries).
Until recently, Yemen was divided into two political systems, the single-party
Communist People's Democratic Republic of Yemen, formerly under British
rule, and the conservative, tribal Yemen Arab Republic. The two countries united
in 1990 to form the Republic of Yemen, with Sana’a in the north as its capital
and Aden in the south as its economic centre. Economic growth in former South
Yemen has been constrained by a lack of incentives, partly stemming from
centralized control over production decisions, investment allocation, and import
57
choices. Yemen's GDP has been supplemented by remittances from Yemenis
working abroad and by foreign aid. Since the Gulf crisis, remittances accordingly
have dropped substantially.
Unification brought with it many challenges for the newly formed republic: the
merging of two different political, economic and administrative systems; the
inheritance of a large external debt of $6.2 billion – 77% of GDP in 2002 (EU,
2003; CIA, 2003); and a bloated bureaucracy from the former south, with high
public expenditures. Further pressure came from the brief civil war of Yemen in
the summer of 1994, resulting in a much weakened economy marked by high
inflation rates. The country has since stabilized politically, and is undergoing an
economic restructuring program with the support of the IMF and the World
Bank.
After unification on 22 May 1990 and ending of the civil war in1994, significant
expansion in economic activity was expected. Oil production and GDP as a
whole were expected to increase moderately from the late 1990s onwards.
Yemen; however, like many developing countries faces the unpredictability of
future events and the possibility of critical development in its socio-political
environment. In addition, the Gulf War of 1991 resulted in immediate cuts in
foreign aid flows from Yemen’s main donors and the expulsion of over 1 million
Yemeni workers from Saudi Arabia. This created an instant increase in the
population, the loss of remittances (the country’s primary source of income),
increased unemployment reaching 30% (CIA, 2003), housing shortages and
pressure on the existing infrastructure.
There is a continuous need for construction projects associated with the
population growth and rapid urban growth. The urban population according to
Ramdane, & Al-abed (1998) has increased to 33% in 1994, from 9% in 1960s,
and according to the UNDP (2002) the urbanization in Yemen is expected to
increase to 31.2% by 2015 (Appendix A-2). The need for adequate housing for
low income people became a very important concern of the Yemeni government;
however, the rush to respond to these needs appears to have resulted in low
58
quality housing and infrastructure that did not adequately meet the needs of the
people. Moreover, the local Yemen construction industry couldn’t cope with the
rapid growth in demand for modern forms of construction that has occurred over
the past decades.
4. 2 THE ECONOMY OF YEMEN
Over the past 30 years, Yemen’s economy has not changed significantly and still
is considered one of the Least Developed Countries (LDC), as classified by the
United Nations (2002). It is also classified as a low income country by the World
Bank (1999). GDP per capita, at current market prices, experienced some
increase from approximately US$215 in 1975 to US$420 in 1999/2000
(Appendices B-1 and B-2). This average per capita income growth rate of 3% to
4% annually is considered very slow in terms of local affordability and prices
growth (Sultan & Kajewski, 2003a).
In the early 1990s, the economic and social conditions in Yemen started to
deteriorate noticeably due to many factors but mainly due to the Gulf Wars; the
reunification of Yemen in May 1990; which has caused even more confusion and
chaos, and the civil war in 1994.
Further, looking into the UN Human Development Reports (HDR) and the WB
World Development Indicators (WDI) for the last few years, there has been no
indication of any significant development; on the contrary, there was
degeneration by the sudden and uncontrolled growth of the construction activities
associated with the return expulsion of over 1 million Yemenis from the gulf due
to the war of 1991(Sultan & Kajewski, 2003 a & b). This created:
• an instant increase in the population;
• the loss of remittances (the country’s primary source of income);
• increased unemployment in Yemen reaching 30% (CIA, 2003);
• housing shortages; and
59
• pressure on the existing infrastructure.
Inflation soared in 2003, jumping from 4.3% in 2002 to 13.6% in 2003 (World
Bank 2004). The heavy reliance on imports is a continuing problem as materials
comprise 60% to 70% percent of the construction costs in the modern sector in
Yemen (Miles, 1984).
In 1995 Yemen initiated an economic reform program, supported by the IMF, the
World Bank and other institutions and countries, aimed at strengthening the
foundations of a market-based and private sector-driven economy, integration
into world markets and financial stability. This approach according to IMF
(2002) is still underpinning Yemeni government policy today. The economic
reform program includes banking reform, privatization of state-run industries,
major infrastructure investment, and reduction or elimination of government
subsidies, on wheat, flour, diesel/gasoline, and utilities. According to Amer
(1998), this program had been thought best to proceed in line with the direction
towards incorporating within the new international economy, including
liberalization of pricing systems, or what generally came to be known in political
terminology as "Economic Globalization".
4.2.1 MANUFACTURING
Until 1999, more than half of all manufacturing establishments were in food
processing. This was followed by textiles, clothing and leather (13%), woodwork
and furniture (12%), nonmetallic construction manufacturing (10%) and metal
products. With regard to ownership of establishments, 99% of all manufacturing
(and 67% of large) establishments were owned by private Yemeni citizens, 0.4%
by the public sector (19% of large establishments), 0.3% by cooperatives and
0.3% were joint ventures (World Bank, 2002a). Furthermore, manufacturing
activities were concentrated in a few governorates. About a quarter of all
manufacturing establishments were located in the capital Sana’a, followed by the
city of Ibb (13%), Taiz (9%), Dhamar and Lahj (8% each) and Hodeidah (7%).
60
These six governorates and the Capital Secretariat hosted more than 71% of total
manufacturing establishments in Yemen.
The manufacturing sector employed 95,413 workers in 1999, 2.5% of the 4.2
million total labor force (World Bank, 2002a), mainly in:
• Food processing (40% of total manufacturing work force);
• Textiles, clothing and leather (14%);
• Construction materials (13%);
• Wood furniture (11% ); and
• Metal products (11% ).
About 36% of employment in the sector takes place at a few large
establishments, 7% at medium-scale establishments and 57% at small
enterprises. Financial institutions contribute only marginally to the financing of
manufacturing activities in Yemen.
Although economic policies should be devised towards encouraging small
industries, facilitating the establishment of new small enterprises and improving
the present ones, current policies basically aim at encouraging and protecting big
industries. For example, the latest investment law, Investment Law No. 22 for
2002, gives advantages to big projects of different types (industrial, housing,
health, tourism etc), section 3, statement No. 23 of the law says that for an
enterprise to enjoy tax exemptions, assets (excluding land and buildings) should
exceed YR 50 million or equivalent, and employees should number at least 10.
As for construction and tourism projects, the former should have no less than 50
housing units, and the latter to be no less than three stars.
4.2.2 OIL AND GAS REVENUE
Yemen's oil output, which averaged 443,288 barrels per day (bbl/d) in 2002,
provides the country's main source of hard currency revenue. The country
contains proven oil reserves of 4 billion barrels (EIA, 2003). The economy fell
61
drastically in the beginning of 1998 when oil prices dropped and remained low
until mid 1999. Yemen was particularly affected, since oil exports make up more
than 90% of total exports and oil revenues finance 70% of Government budget
expenditures (EC, 2002). The oil revenue economy continues to be constrained
by political instability, corruption, and poor macroeconomic management. The
Yemeni Government has experienced difficulty in making significant progress in
diversifying the economy away from its reliance on the capital intensive oil
sector which now provides over one third of the GDP budgetary revenues
(Appendix B-1 and B-2 ).
Regime officials also appear undecided on how to redress fundamental economic
imbalances resulting in troublesome inflation and the discouragement of
investors. The government's resistance to initiating greater transparency and
accountability in managing the country's oil earnings continues to limit economic
growth. In the framework of these economic reforms, economic growth in the
non-oil sector will be pursued through the expansion, promotion and
diversification of the industrial base through establishment of industrial zones
and improvement of the investment climate (EC, 2002). In addition, there are
some 14 billion cubic feet of proven gas reserves. The government intends to
encourage its exploration through private investment for export, as well as for
possible utilisation for national gas power generation.
4.2.3 CONSTRUCTION INDUSTRY AND THE ECONOMY
The construction industry plays an important role in the economy. Key statistics
on Yemen and its construction industry show that value-added in construction
decreased from 8 in 1975 to 3.4 % in 2003 as indicated in Table 4.1, and it
employs 6.6% of the total working manpower. The Second Five Year Plan
(SFYP) as proposed by the World Bank (2002a) envisages an average annual
increase in construction activities of 11% and as a result the sector’s share in
GDP is planned to increase from 4.2% in 2000 to 5.5% in 2005.
62
Table 4.1 Construction in the Economy of Yemen
GDP per capita Gross
construction
US$ % of GDP
1975 215 8
2000 420 4.2
2003 460 3.4
Resources: Wells J. 1986, IMF 2001, World Bank 2002a and Central Bank
of Yemen 2003
Table 4.2 Construction GDP as Percentage of Total GDP in some
Developing Countries
Source: UNCHS 1984a
The construction sector was ranked 8th in its average relative contribution to
GDP during the period 1990 to 2001 as indicated in Table 4.3. The average
contribution to the GDP was 4.1%, compared with 29.5% for mining and
quarrying, 15.1% for agriculture and fishing, manufacturing 11% and
transportation 7.1%. Even before oil dependence, the construction industry made
a moderately low contribution according to the Central Bank Annual Report
(2002) with a negative balance of payment of over US$ 29.9 million.
63
Table 4.3 Average Contribution of Main Economic Activities 1990-2001
Average Contribution %
Mining and quarrying 29.5 Agriculture, forestry and fishing 15.1 Government services 11.4 Manufacturing 11 Wholesale and retail trade 10.9 Transport, storage and communications 7.1 Financial institutions and real estate 5.1 Construction 3.6 Import duties personal services 3.9 Community, social and personal services 2.4 Electricity, water and gas 1.7 Other services 0.1 Imputed bank service charges -1.8 100
Source: compiled from various sources (refer to Appendix B-2 and Amer A.
A., 1998)
Central Bank statistics (2002), IMF (2001 & 2002) and World Bank reports,
show that declining demand has seen a drop in the construction industry’s
average contribution to the GDP from 8% in the 1970s to an average of 3.6% in
the 1990s (Appendix B-2) and as low as 2.7 % of the GDP in 1990 (Amer A. A.
,1998). This trend has been accompanied by greater volatility of demand.
Construction activity boomed in the early 1990s following the return of
immigrants from the Gulf States and recorded an average annual growth rate of
12.0% during 1991 to 1992 (World Bank, 2001). Construction activity slowed in
1993 and declined by 17% in 1994. Post-war recovery boosted construction to an
average growth rate of 26% during 1995 to 1997 before decelerating to an
average rate of 3.5% in the years 1999 to 2001.
64
4.2.4 LABOUR AND EMPLOYMENT IN YEMEN
Yemen was considered an exporter of unskilled labour (Wells, 1996; Fergany,
2001; ESCWA, 1993). As construction booms began in the gulf countries in the
1960s and 1970s, labour was attracted from throughout the region, including
Yemen (Fergany, 2001; ESCWA, 1993). In 1975, about 280,000 Yemenis were
working outside the country, remitting some US$375 million annually. In 1979,
this remittance rose to US$1.5 billion (Kulkarni, 1983). This introduced a
paradoxical situation in which Yemeni workers found outside employment more
profitable, while many foreigners found Yemen a more hospitable country in
which to work. Short-term emigrants between 1973 and 1983 reached about
470,000 and consisted mainly of unskilled construction workers. The national
exchanger gained much needed foreign exchange for development, but the nation
lost its pool of skilled workers and human resources.
The late 1980s saw the end of the construction booms in neighbouring countries.
With the completion of preliminary infrastructure and the initiation of turnkey
projects where the contracting company provided its own labour, the demand for
Yemeni services decreased substantially (ESCWA, 1993). It was estimated by
the ILO (1991) that approximately 800,000 Yemenis returned from Saudi Arabia.
Of these, 11.3% were construction workers and 13.9% were unskilled labour
(Colton 1993). It was expected that those labourers who returned would bring
with them valuable experience. But recent history has demonstrated, that it was
not possible for the local Yemen construction industry to cope with the rapid
growth needed for the modern forms of construction that have occurred over the
past decades.
Table 4.4 indicates the existence of an excessive unskilled labour market, the low
number of craftsmen, and absence of management (including site supervision
and administrative personnel).
65
Table 4.4 Breakdown of Labour Force by Labour Category
Source: UNCHS 1984a
Table 4.5 outlines the moderate labour employment in the construction industry
in Yemen. It can be suggested that the construction industry has not used the full
capacity of the excessive labour market. Some of the reasons could be that
labour-intensive methods are inefficiently managed, and therefore more
expensive and difficult to control or simply that it has not been encouraged by
the local governments and private investors.
Table 4.5 Employment in Construction
1975 1990 2001
Yemen 4% 7.5% 6.6%
Average developing countries 5%-15%
Source: UNCHS 1984a, World Bank, 2002a and ESCWA 1993
66
4. 3 A BRIEF HISTORY OF THE CONSTRUCTION INDUSTRY IN
YEMEN
Unlike many of the other developing countries and countries in the region,
Yemen has a unique heritage of buildings, urban centres and civil construction.
Until the 1960s, Yemen utilized only locally available materials (Appendix E).
There was an elementary but effective organization for construction. According
to the UNIDO/World Bank (1981) the compelling merits of this model of the
construction industry, which survived with almost no change over centuries,
were many. Designs were such as to meet the needs of the environment, not to
violate it.
Prior to the 1962 revolution and during the civil war that extended up to the
1970s, all public sector construction was the direct responsibility of the Ministry
of Public Works (MPW). Before 1962, the only paved road in the country was
the one connecting Sana’a with Hodeidah City. There was no electricity, water,
sewage or other municipal services, no schools, and no hospitals. According to
Miles (1984) the government was faced with the massive task of developing
from scratch a national information structure and civil administration
Faced with the tremendous task of nation building, the new government invited
many national and international organizations and humanitarian agencies to
assist in its socio-economic development. Funds and experts poured into the
country during the transition period from 1973-1981. With the old institutional
framework, only a modest administrative culture, and almost no technical and
managerial cadres, it was not possible for the new government to control and
channel this sudden inrush of developmental assistance. The funds that became
available for construction rapidly outpaced the limited resources of the technical
and administration staffs of the Ministry of Public Works.
Kulkarni (1983) added that the limitation of the Ministry of Public Works and
the concern of other ministries and authorities to provide infrastructure and
rapidly achieve physical goals created a ‘free for all’ situation. Every department
67
of the government involved itself in the construction industry. They started
choosing their own consultants, supervising procedures for the tender of the large
projects, awarding works and generally mismanaging. Under the pressures of
expanding assistance and credits, they lost sight of the need for coordination of
efforts.
The impact of planned development in the Yemen was also felt in the building
materials sector of the construction industry. Kulkarni (1983) indicated that in
1973, the rate at which the construction materials were produced by private
owners was inadequate to meet the demand for construction. By 1976 that the
only increases were the prices of these materials with deteriorating quality. The
demand for new materials shot up, and each consultant specified only the
products with which he was familiar. This created chaos. Also the growth of the
imports in the transport sector outnumbered everything because the goods had to
be moved around.
The coordination of import policies required for the construction industry was
lost in the chaos and confusion. Whatever material was loaded at the port was
used up. New items appeared on the market frequently and disappeared rapidly.
It was difficult to specify construction products and then receive them in
sufficient quantity, unless one took to importing materials for the project on a
priority basis (Kulkarni, 1983).
Following the import of new materials came the introduction of new techniques
of construction, new equipment, and new skills from outside the country. A new
breed of technicians and workers flowed into Yemen, while the local traditions
were pushed into the background. The traditional Yemeni knowledge, experience
and insight regarding local materials started to disappear. The construction
industry lost its character as a craft-based industry. Moreover, UNIDO/World
Bank (1981) stated that the local Yemen construction industry couldn’t deal with
the rapid growth needed for the modern forms of construction.
68
4.3.1 TRADITIONAL CONSTRUCTION IN YEMEN
Yemen established a unique rich building tradition and uniform style of the
traditional Yemeni architecture and townscape which is justly admired
(Appendix E 1). Until 30 years ago, this tradition was being successfully
maintained. The major pressure was; and still is, the rapid pace of change from
the traditional to modern and conventional building methods and materials. The
main characteristics of the traditional construction are the use of local materials
and the implementation of indigenous methods and techniques.
The traditional buildings may have as many as eight storeys and they have load-
bearing walls constructed with either exposed hewn stone or rammed earth or
earth-blocks, depending on the material available in the region. The walls and
ceiling in the rooms are plastered with gypsum. Doors and windows are made
locally of imported hardwood, aluminium or steel. Hardware in traditional
buildings is made locally.
The traditional Yemeni architecture is well adjusted to the hardship of the
different climatic regions of the country. In dry climates with big differences in
temperature between day and night, houses are built with stone, brick or mud
walls of thickness of 50cm and over. The high thermal inertia of the mud and
stone walls reduces the differences in temperature of the interior spaces to the
minimum. In hot and humid areas, the traditional buildings have high ceilings
and large openings for cross ventilation.
However, according to Erdik (1992), recent earthquakes have shown some
vulnerability of the traditional buildings and have raised questions concerning the
future of traditional building in Yemen.
Serageldin (1982) stated that the craftsmanship that marked traditional Yemeni
stone and brick construction was rapidly disappearing. In parts of Sana’a,
Hodeidah and Taiz, the expanded use of concrete blocks, which are relatively
69
cheap to produce, has resulted in a departure from the traditional Yemeni
architectural style.
4.3.2 MODERN CONSTRUCTION IN YEMEN
The modern/conventional construction in Yemen refers to buildings built
recently and after the 1960s, mostly in cities and large towns, and whose main
characteristic is the reinforced concrete frame (Appendix E 2). Walls are made of
concrete blocks and sometimes an additional facing of local stone, a kind of
modern/traditional, which is extremely expensive (Sultan & Kajewski, 2003a).
Where walls are made of cement blocks only, they are usually plastered inside
and out with cement plaster. Floors are covered with terrazzo tiles and doors are
made of imported hardwood or softwoods or steel. Walls are frequently oil and
emulsion painted. Hardware as well as material and fixtures for electrical and
plumbing and sanitary units are all imported.
Buildings designed and constructed in the ‘modern’ technique are usually
unsuitable to the various climatic conditions of Yemen. Their design often
ignores the environmental conditions. As a consequence, there is no adequate
protection against the climate and comfort is minimal. The reinforced concrete
buildings with concrete block walls do not have enough thermal inertia; hence,
they are warm during the day and cold during the night. The physical stress and
thermal expansion caused by the extreme differences in temperatures very
quickly deteriorates the construction and the appearance of the building.
Buildings of the same design constructed in the hot climate of Hodeida offer very
little thermal comfort because of inadequate ventilation. Concrete and plaster
also disintegrate very quickly under the humidity and salinity of the air.
Serageldin (1982) added that construction in urban areas was often carried out
using modern techniques. The relatively expensive and inefficient labour-
intensive methods and the low productivity have led contractors to make
investments in labour-based construction.
70
4. 4 BUILDING MATERIALS
The only major building materials industry in which the government is involved
is cement production. Although Yemen has three huge cement plants which are
able to meet the increasing demands of local market, thousands of tons of cement
are annually imported. It is also known that Yemen has not significantly
implemented the policy of import substitution in the building materials industry,
except with PVC pipes, cement, and paint; hence, the local production of
building materials in Yemen is little more than substitution of one kind of
imported materials for another, with little use of local labour or development of
locally available materials.
Yemen has great reservoirs of glass sand granite, marble gypsum, which will, if
exploited properly, help Yemen achieve a state of self-reliance of these resources
and enable it to export the surplus. Al-Kamali (2001) indicated that more than
150,000 tons of gypsum are imported annually, ignoring billions of tons of the
best kind of gypsum reservoirs available in the country.
Traditional materials for the mountain area are natural stones, burnt clay bricks,
timber and branches and gypsum. Natural stone, such as basalt is used for
foundations with mud and sandstone being used for exterior walls. This is
particularly important because of its excellent thermal insulation qualities.
Timber, mostly imported, is used for roofing, doors window frames. Gypsum is
used as plaster for walls, ceilings, and floors, as well as for decorative arches
over windows and doors. The traditional materials for the coastal region are
burnt clay bricks and mud bricks, while natural stone, which is so commonly
seen in other parts of the country, is generally not common or very modestly
used by wealthier groups who can afford the high cost of stone delivery and
craftsmanship.
New materials introduced in the 1960s and 1970s were hollow cement blocks for
walls, reinforced concrete slabs to replace traditional roofing and flooring
71
materials, reinforcing rods and structural steel, and terrazzo and cement floor
tiles (Miles, 1984).
All reinforcement steel is currently imported. Most of the structures designed by
local engineers use the readily available mild steel. Most contractors set up a
reinforcement fabrication yard on the construction site, as there is no specialist
steel stock-holder who will cut, bend, fabricate and deliver reinforcement cages.
Cutting and bending is generally done manually using hand tools and simple
equipment (Miles, 1984). Aluminum and all ceramic tiles are imported. The
manufacture of doors and windows is done locally in small workshops.
All simple and complex mechanical and electrical equipment is also imported.
The advanced technology of installing and commissioning such equipment
requires the services of qualified engineers and highly skilled technicians. Such
skills are very scarce in Yemen and expatriate technicians are almost always
employed. Even after commissioning, expatriate advice is often required to set
up operational and maintenance schedules. In small to medium jobs, the
installations are less complex, and many components can be procured from local
merchants.
4. 5 INFRASTRUCTURE
Yemen is a rural country of about 531,870 km2. Approximately 70% of the
18.5 million population reside in villages or clusters of homes. 90% of the
population is concentrated in mountainous areas. The highlands contain
elaborately built terraces of ancient origin. Yemen's topography and habitation
patterns present challenges in establishing a suitable road network providing
access to the population. According to the Social Fund for Development (2003),
Yemen's 18 million people live in about 106,000 residential groupings and
compared to other countries this figure is considered extremely high.
72
In Yemen, the process of infrastructure building and human resource
development has been a priority. The government has been spending an average
of 30% to 40% (Yemen Times, 1998) of its annual budget on capital
accumulation. Yet, there isn't much accumulation in the true sense and
construction works were of poor quality. A classic case is road construction.
Yemen's road network consists of about 70,000 km of roads (6,200 km of asphalt
roads, 2,900 km of gravel roads, 2,200 km of urban roads and around 60,000 km
of feeder unpaved roads). Feeder roads are tracks or earthen roads. Most of the
feeder road network was constructed during the 1970s and 1980s by Local
Development Associations. Yemen spends annually about YR 15-20 billion
(US$103 million) on road construction, both in cities and between cities.
The Yemen Times (1998) added that the life-span of roads in Yemen is much
shorter than the world average, roads last for an average of 8-10 years in the past
but the problem has been worsening. In some cases, they fall into disrepair even
before they are formally handed over by the contractor.
4. 6 LOCAL CONTRACTORS
The average Yemeni contractor is small-scale organization (World Bank, 1984),
fairly ignorant in material and management techniques. The local contractor is
also limited in human resource capacity and has unreliable credit facilities and
cash problems which leads to difficulties in financing.
It was indicated by UNIDO/World Bank (1981) that only a few local Yemen
firms have been able to adapt and develop their commercial, managerial and
technical skills sufficiently to cope with the rapid growth and demand for
construction over the last decade. Although these local firms were able to secure
a share of the expanding workload, many of them encountered severe operational
problems due to their inexperience in organizing large projects together with the
effect of inflation on fixed price contracts.
73
Despite the considerable volume of development, little attention was given to the
needs of local contractors, particularly in upgrading their capacity and
competitiveness, and many left the contracting industry to engage in more
rewarding forms of commercial activity. According to UNIDO/World Bank
(1981) the local contractors who managed to stay active have often either
employed foreign engineers or intentionally restricted themselves to domestic,
small and simple projects.
4. 7 LAW AND CONSTRUCTION CONTRACTS
Contractual arrangements used in Yemen are based mainly on the promise that a
client has sufficient resources to undertake a project and that contractor has the
necessary expertise to accept the project. Although the contractual arrangement
provides for legal redress, it is not always feasible or expedient for the contractor
to take the client to court (and vice versa), since the contractor often depends, to
some extent on the client’s goodwill for subsequent jobs. Parties also try to avoid
legal action as legal and court procedures are very expensive, complex, often
corrupted and time consuming. There are also ineffective penalties or
compensation for delay or damage.
The multiplicity of agencies working to their own conditions of contract and the
differing languages in which contracts are written has only added to the
confusion. Also there are always differences on major issues such as the validity
of agreements, the resolution of disputes, penalties, damages and the adequacies
of compensation. Further, the World Bank (2002a) has indicated that the law
dealing with construction and land affairs in construction sector development is
one of the main constraints.
There has been hardly any effective professional body on which the industry may
rely. The Association of Engineers, for example, was not formed until 1980 and
to date it has not had any influence or contribution on construction development.
74
Kulkarni (1983) indicated that this is due to the lack of finance and absence of
strategies.
4. 8 CONSTRUCTION COSTS
Building construction costs registered an increase in rates in the 1990s at rates
much faster than inflation. It is seen that in view of the increase in cost for basic
input materials like steel, cement, brick, timber and other materials as well as the
cost of construction labour, building costs increased at around 20% to 25%
annually even when inflation was low (Sultan & Kajewski, 2003a).
Despite there being some attempts to bring income levels in line with the levels
of inflation through inflation-indexed rises in salaries; housing and other
commodities are becoming beyond the reach of affordability for the majority of
the people. Furthermore, the reductions in building quality and housing size are
other indications to the rapid increase in cost of construction.
In less than two decades, the construction cost has increased from around
YR 3,000 per m2 in the early 1980s to as high as 47,000 YR/m2 in 2000 as
indicated in Table 4-6. This is only in respect of the normal types of housing
construction and finishing. Still higher levels of costs are registered for using
better finishes and amenities. It is essential, therefore, to study the behaviour of
construction costs to determine the most influential factors that drive the costs
up.
What is most remarkable according to Serageldin (1982) is that whereas
traditional construction in Yemen was more economical in 1972, it became
considerably more expensive by 1982. Part of the increase is attributed to
increased prices for materials, but much of it is due to scarcity of skilled and
semi-skilled labour resulting from the significant migration to neighbouring
countries that followed the 1973/74 oil price boom. The costs of construction
have been rising much more sharply than any other economic indicator, with
75
labour costs being the most important factor in this escalation. Table 4.6
demonstrates the labour cost and construction cost as incurred by local Yemeni
contractors. These assume small to medium sized construction projects at non-
constrained and non-remote locations.
Table 4.6 The Construction Labour Costs
Source: Sultan & Kajewski (2003a)
Table 4.7 demonstrates the changes in the building costs since 1979/1980 to
1999/2001 and indicates the costs of the main construction materials as delivered
on site in the Sana’a area. Building costs are the costs actually incurred by the
builder/contractor in the course of business. The building costs reflect the
fluctuations since 1980 in wages and materials costs to the builder. The figures
demonstrate a rising trend in prices (in local currency) since 1980.
76
Table 4.7 The Construction Materials Costs (all figures in Yemeni Rial)
Source: Sultan and Kajewski (2003a)
4.8.1. CONSTRUCTION COST, EXCHANGE RATE AND
INFLATION
Inflation is an economic reality affecting every industry. The construction
industry is no exception; it is highly sensitive to inflation due to its unique
characteristics. It is stated by Ofori (2000) that the economies of many
developing countries are currently confronted by severe difficulties owing to a
combination of lower commodity prices, higher energy costs, falling exchange
rates and rising inflation.
77
The construction sector in Yemen is dependent on imports for both final goods
and intermediate input for local production. As a result prices vary almost
directly proportionally to the changes in the exchange rate of the Yemeni Rial.
Wages; particularly in the public sector do not follow this trend. with an average
growth of GDP over the last 10 years approximately 2% (with frequent declines
in purchasing power). Figures 4.1 and 4.2 show the sharp increase in
construction cost and exchange rate.
Figure 4.1 Variation of Construction Cost in Local Currency (YR) with
Time (Source: Sultan & Kajewski, 2003a)
Figure 4.2 shows the increase of exchange rate since 1980 from about 4.5 YR
against the US$ to 165 YR in 2001 and 183 in 2003. This can be taken as an
indication of price increase.
78
Figure 4.2 The Variation of Exchange Rate (YR) with Time (Source: Sultan
& Kajewski, 2003a)
Inflation soared in 2003, jumping from 4.3% in 2002 to 13.6% in 2003 (World
Bank, 2004). Price increases have been above 10% during 2003. The largest
increases have been in food components of the consumer price index CPI (16.8%
in 2003) and housing costs (10.4% in 2003). The rest of the components have
increased by less than 10% in 2003. The CPI inflation (excluding Qat13 and food)
for 2003 was 6.5%. Inflation remains high in early 2004. CPI inflation rate for
January 2004 (y-on-y) was 12.5% (16.4% for food).
4.8.2. AFFORDABILITY AND PURCHASING POWER
The concept of purchasing-power parity (PPP) has two applications; it was
originally developed as a theory of exchange rate determination, but is now
primarily used to compare living standards between countries. Turin (1973)
suggested that unless the capacity of the construction industry of any country
grew faster than the GDP, the industry could constrain overall national socio-
economic development. Turin (1973) also observed that the proportion of GDP
13 Qat, a mildly narcotic shrub
79
contributed to the construction industry in developing countries range between
3% and 5 %. This finding was confirmed by Edmond & Miles (1984) and Wells
(1985). Hillebrandt (1985) has also stated that any reduction in purchasing
power will similarly affect the construction industry, moreover if the output of
the industry is down, total investment is down.
It has been shown that the affordability of construction costs is getting more
difficult for the average income person in Yemen and in some low income
countries (Sultan and Kajewski, 2003a), they also concluded that to allow the
execution of an efficient and sustainable construction activity within affordability
conditions, the construction cost should be reduced or alternatively the GDP per
capita be increased. The GDP must reach certain levels to allow a satisfactory
and sustainable development of the construction activities through the purchasing
power. This in return should allow the construction industry to positively start
contributing to the economy and simultaneously to living standards.
4. 9 SUMMARY AND CONCLUSION
The construction industry in Yemen, like other developing countries, is in a very
difficult and challenging state, characterised by low value-added, inflation,
unemployment, size of capital formation, un-affordability, lack of infrastructure,
cultural heritage, the absence of crucial and fundamental institutions and
procedures. Illustrating the nature and performance of the industry, both at
industry level and on the industry’s contribution to the nation’s overall economy
and explaining that there are severe problems paves the way for speculating
about how they might be overcome. This chapter contributes to a better
understanding of the construction industry in Yemen and some of its cultural and
economical issues. It has provided a background for discussion of the Yemen
prospective and policy analysis in later chapters.
80
This research is undertaken to examine the Yemen construction industry and
answer the hypothesis questions:
“What are the real constraints hindering the development of the construction
industry in Yemen?”
and
“how to stimulate construction industry in Yemen to achieve economic
sustainability?”
The next chapter discusses the methodology undertaken to achieve these research
objectives.
81
CHAPTER 5
RESEARCH METHODOLOGY
This chapter describes the methodology employed in this study, including the
rationale for the research design, the procedure used, sample selection and a
review of the methodology. The documentation of the research methodology
represents an important step in the completion of the research as it provides an
understanding of the research process followed, to improve the ability to apply
the results of the research, to assess the validity of the claims made, and to
evaluate the soundness of the hypothesis theory -based proposition tested.
In order to facilitate an evaluation of methodology, it is useful to restate the
hypothesis that will be tested. This study was designed to determine if the
following hypothesis is supported with the facts:
The process towards progressive and economically sustainable construction
industry in Yemen requires the introduction, initiation and implementation of
appropriate local polices and strategies.
Before considering the principal methods applicable to the research, it is
necessary to refer to the theoretical orientation and assumptions underlying
research in management disciplines to illustrate what research perspective was
adopted. This section will be followed by a general description of the
methodology research strategy adopted with a justification for such
82
methodology. A detailed description of each phase of the methodology is
followed by a description of the techniques, and activities used for data
collection and final validation of the results. Clear and pre-stated data collection
procedures were vital to ensure the integrity of the information and reliability of
the research process.
5.1 JUSTIFICATION OF THE METHODOLOGY
The justification of the methodology is based on the appreciation of the approach
selected, which best serves the research purpose and is most appropriate to the
phenomenon under study.
5.2 THE SCIENTIFIC METHOD AND THE RESEARCH PROCESS
It is important to state, among the different ways available for establishing or
changing beliefs about observable fact (i.e. phenomenon), science is the one that
was pursued and followed to conduct this dissertation. Other ways of knowing
like intuition, tenacity, or authority are all less than adequate modes of altering
beliefs, primarily because there is a high degree of subjectivity in the individual’s
judgments about what constitutes truth (Stone, 1978). Instead, science aims at
knowledge that is objective in the sense of being certifiable, independently of
individual opinion or preference, on the basis of data obtainable by suitable
experiments or observations.
The general framework used in this dissertation for scientific inquiry is based on
the scientific method represented in Figure 5.1.
83
Figure 5.1 Model of Scientific Method (adopted from Stone 1978)
The scientific method consists of the following elements:
• the observation of phenomena or facts in the real world;
• the formulation of explanation for such phenomena, using inductive
processes;
• the generation of predictions about phenomena in the world, using
deductive processes; and
• the verification of these predictions through systematic, controlled
observation.
The scientific method is applied by conductive scientific research. The term
scientific research refers to systematic, controlled, rigorous, empirical and critical
investigation of a hypothetical proposition about a presumed relation among
phenomena, to find the solution to a problem or discover and interpret new
Real world
facts
Explanation of relation
among facts
Prediction about real
world
Induction
Deduction
Verification
84
knowledge (McCuen, 1996). In general, the term ‘research’ refers to the rigorous
scientific activity aimed at developing a new body of knowledge.
Although many other definitions of scientific research can be found in the
literature, the common thread that appears to bind all of these definitions together
is that scientific research is the investigation of phenomena via practices
consistent with the method of science.
It is also important to note that the scientific investigation and verification of
beliefs about various real world phenomena involves what is known as empirical
research based on the belief that ‘all knowledge must originate in experience’
(Stone, 1978). Also according to Houben et al (1999) the term knowledge refers
to knowing something with familiarity gained through experience or association.
Knowledge is the integration of a collection of facts, beliefs, heuristic rules and
relationships. In other words, facts are made known to us through our senses;
therefore, for a fact to be considered real, it must be capable of being sensed by
others, which implies objective reality. Empirical research is a research that deals
with the facts that have objective reality.
The generic process followed to conduct the research presented in this thesis is
the process for empirical scientific research shown in figure 5.2 (McCuen, 1996).
Other models for empirical scientific research can be seen as a detailed version
of this basic model.
85
Figure 5.2 The Empirical Scientific Research Cycle (adopted from McCuen 1996 and Stone 1978)
The model shows that the basic steps that must be followed in any empirical
study of a phenomenon are:
• Observation: an informed and critical questioning of an existing
phenomenon leading to the problem statement and the research
question.
• Hypothesis: a formal expression of a preconceived factual
relationship which provides a tentative explanation or solution to the
problem.
• Experimentation: the design of the study leading to a systematic and
controlled testing of the hypothesis.
• Induction: a generalisation of the experimental results to a formal
statement of the theory.
Briefly, empirical scientific research process requires that the researcher first
recognises a problem and/or formulates a question or set of questions that will be
OBSERVATIONS Research questions and problem
statement
EXPERIMENTATIONDesign and Observations
HYPOTHESIS
INDUCTION Conclusions
86
addressed by a study. Next, the researcher develops a hypothesis to be
empirically tested. A specific strategy or study design is then developed to assess
the validity or truth of the hypothesis. The researcher next implements the
strategy and observes the values of relevant variables or data during the
experimentation step. The resulting data is then analysed to determine whether or
not it provides support for hypothesized relationships. Finally, the study’s results
are examined by the researcher and used as a basis for conclusions about the
studied phenomenon.
In addition, the process of induction allows the researcher to develop a formal
theoretical statement about the phenomenon under study. Because scientists can
never develop a theory that describes the researched phenomenon completely,
limitations on the verification of scientific theory are inherent; however,
completing the induction-deduction-verification cycle of the scientific method
strengthens scientific theory.
Stone (1978) stated that theories, per se, are never either verified or falsified
through research instead propositions, deducted from theories are subjected to
empirical testing. The greater the number of theory-based propositions that are
supported by empirical research the greater our confidence in the ability of the
theory to explain and/or predict real world phenomena. It is the process of
verifying theory-based propositions in such a way as to allow the facts to
discredit them, that distinguishes this method of science from any other method
or way of knowing. The cyclical nature of the scientific method assures us that
erroneous beliefs will be modified when research data fails to support them. If
the results of numerous empirical studies or iterations of the inductive-deductive-
verification cycle fail to provide support to theory-based propositions, a scientist
may choose to revise or abandon the theory.
87
5.3 DEFINITION OF RESEARCH METHODOLOGY
An important consideration in evaluating the soundness of a theory and assessing
the validity of claims is the manner in which individuals establish, defend, or
change their beliefs or knowledge about various issues. This is important since
the confidence that can be placed in the validity of any proposition is a function
of the method or methods a person uses to find out the truth of that proposition.
The collection of methods to change or create new beliefs and knowledge, and
their interpretation refers to what is known as “research methodology”. Although
the term methodology means different things to different people, and as any
other concept, its meaning is continually evolving, what is important to
understand is that research methodology deals with the methods for creating
knowledge about the world and the interpretation of this knowledge in light of
the ontological epistemology positions (Reich, 1994).
Methodology is concerned with questions such as: how is research planned and
executed? How are theories created and tested? How are tests interpreted?
Ontology deals with the nature of the things we know about the world or the
nature of the world. A central ontological question is: do we know things about
the real world, or is our knowledge a reflection of our manipulation of the world?
Epistemology deals with the relation between humans and their knowledge, and
is a philosophical branch that deals with the theory of knowledge. Typical
epistemological questions are (Reich, 1994): What can we know? How do we
know? What is truth? Is there a priori knowledge, and if so, of what?
5.4 SELECTION OF RESEARCH STRATEGY FOR SCIENTIFIC
ENGINEERING AND CONSTRUCTION MANAGEMENT
RESEARCH
Engineering is defined as ‘the profession in which a knowledge of mathematical
and natural sciences gained by study, experience and practice is applied with
88
judgment to develop ways to utilize, economically, the materials and forces of
nature for the benefit of mankind’ (Bennett, 1996).
Based on the definition of empirical scientific research described earlier,
engineering and construction management research can be defined as the
systematic process of discovering, acquiring, and using knowledge to solve a
problem of theory or practice in any subject related to the field of engineering
and construction management.
Examples of engineering and construction management subjects include, but are
not limited to, the use of engineering, materials, machines and labour to supply,
fabricate, erect and provide facilities or structures for use of society following the
themes:
• management and business technologies and practices;
• design technologies and practices;
• construction and equipment technologies and practices;
• construction materials and systems;
• facilities operation and maintenance technologies and practices; and
• public and government policy (relevant to construction industry).
This investigation falls mainly within the management and business technologies
and practices and public and government policy themes, addressing the general
subjects of project initiation and planning, and more specifically, with a focus on
how to set up-front achievable, reasonable policies and strategies to fulfil the
objectives for achieving economic sustainability and come within reach of
sustainable development. The purpose of this section is to show what form or
forms of research are relevant to conduct empirical scientific research for the
subject of project initiation and project planning to answer the research questions
indicated in Chapter 1.
There are a number of different approaches to research. There is also a difference
in the degree of scientific method adhered to in carrying out the research. For
89
instance, in the physical sciences, it is much easier to have rigid control over an
experiment to formulate a hypothesis, design a rigorous research project, control
all variables, and look for the answer. A sample of different research strategies
used for empirical research is shown in figure 5.3.
Figure 5.3 Example of Empirical Strategies (adopted from Stone 1978)
A common misconception is that the various research strategies should be
arranged hierarchically; thus, some scientists are taught that case studies are
appropriate for the exploratory phase of an investigation; that surveys are
appropriate for descriptive phase; and that experiments are the only way of
developing explanations for inquiries. Yin (2003) believes that this hierarchical
view of research strategies is incorrect. Experiments with an explanatory motive
have certainly always existed. In addition, the development of causal
explanations has long been a serious concern of historians, reflected by the
sub-field known as historiography. Finally, case studies are far from being only
an explanatory strategy. Some of the best and most famous case studies have
been both descriptive and explanatory.
RESEARCH STRATEGIES
Field study
Simulation
Field experiment Laboratory experiment
Case study
Sample survey
90
The more appropriate view of these different strategies is a pluralistic one. Each
research strategy can be used for all three purposes in science, namely,
exploratory, descriptive, or explanatory. What distinguishes each strategy is not
this hierarchy, but other conditions. These consist of the following (Yin, 2003):
• the type of research question posed;
• the extent of control an investigator has over actual behaviour events;
and
• the degree of focus on contemporary as opposed to historical events.
Bennett (1991) suggested that an additional condition for choosing an
appropriate research strategy was the current state of knowledge of variables
involved.
The first and most important condition for differentiating among the various
research strategies is to identify the type of research question being asked. In
chapter 1, the following research questions were formulated:
What are the real constraints hindering the development of the
construction industry?
and
How could construction industry in Yemen achieve economic
sustainability?
Table 5.1 displays the conditions for various research strategies. ‘What’, ‘Why’
and ‘How’ questions are likely to favour the use of survey and case study
forecast strategies.
91
Table 5.1 Relevant Situations for Different Research Strategies
Strategy Form of research
question
Requires
control over
behavioural
events
Focuses on
contemporary
events
Experiment How, why Yes Yes
Survey
Who, what, where,
how many, how
much
No Yes
Archival
analysis
(e.g. economic
study)
Who, what, where,
how many, how
much
No Yes/no
History How, why No No
Case study How, why No Yes
Source: adopted from Yin (2003) The case study is preferred in examining contemporary events, especially when
the relevant behaviour of the phenomenon being studied cannot be manipulated,
contrary to experiments. Even though the case study relies on many of the same
techniques as a history analysis, it adds two sources of evidence not usually
included in a historian’s repertoire: direct observation and systematic
interviewing. The case study’s unique strength is its ability to deal with a full
variety of evidence like documents, artefacts, interviews and observations.
If little is known about the nature of the variables involved in the research
problem, which is the case in planning for economic sustainability and
sustainable development, then it is likely that more qualitative research methods
92
will be needed to answer the research questions formulated in Chapter 1. To
conduct the research study presented in this document, a survey on the local
industry investigation and a group consensus Delphi method were selected.
5.5 SURVEYS STRATEGY
A wide variety of methods can be used in systematic evaluation of the problems
and needs of a target group for purposive, organized intervention programs. The
methods vary in their complexity, costs and diagnostic accuracy. They include
resource inventory, use analysis, social indicator analyses, surveys and structured
groups. McKillip (1986) recommended the use of multiple methods to reduce
bias and increase accuracy. A similar approach was recommended by Hernes
(1988) for identifying contractor training needs. He recommended that
information should be obtained from contractors themselves, from independent
construction consultants who work in the industry, and from clients’ supervisory
staff who work closely with contractors. Rossi & Freeman (1989) argued that
information collected from varying perspectives on needs may eliminate
rancorous conflict that may arise, may lead to a re-conceptualization of the
problem, or of the prospective solution, or may even indicate the advisability of
abandoning the program.
The survey is a very popular method of gathering information for need
identification and assessment as it allows inputs from various sources, clients,
key informants, target populations and helps to build consensus for solutions
(McKillip, 1986). The goal of writing a survey question for self-administration is
to develop a query that potential respondents will interpret in the same way, be
able to respond to accurately, and be willing to answer; however, in practice,
producing good questions is often difficult. In implementing a survey the
questionnaire is only one element of a well-done survey (Dillman, 2000).
93
The survey strategy involves research in which:
• data are collected from members of a sample that represents a known
population;
• a systematic technique (e.g. questionnaire or interviews) is used to
collect data;
• the researcher manipulates no independents variables;
• data are sought directly from respondents;
• subjects provide data in natural settings;
• responses of subjects are assumed to be largely unaffected by the
context in which they are elicited;
• influences of confounding variables are controlled statistically; and
• the purposes of the research may range from exploration of
phenomena to hypothesis testing.
The sampling survey strategy allows the researcher to generalize a study’s results
to a known population. A researcher using the sample survey strategy collects
data directly from respondents in a systematic fashion. The setting in which the
data is obtained is natural and assumed to not influence the values of the
variables. The sample survey is a form of ex post facto research. The researcher
manipulates no independent variables; instead, such variables are simply
measured by the researcher. Apart from the purposes mentioned above, the
sample survey may also predict future conditions.
Instruments should be initially piloted to a small number of respondents to verify
whether the questions are easy to understand, appropriate to the research topic,
unambiguous (Fellows and Liu, 2003), and to gain some idea of the time to
administer the questionnaire. It is also important to get feedback and input on
other important issues that may be worthy of consideration, that the initial
instrument has missed. This also gives the researcher an indication of whether
the instrument is measuring the right concept and it is consistently measuring the
concept being measured, hence its validity and reliability.
94
Advantages associated with survey strategy (as adopted from Stone, 1978):
• the sample is chosen in such a way as to allow for generalizations to a
defined population;
• results are accurate because of large sample size and generally low
sampling error;
• random sampling procedures reduce or eliminate problems of sample
bias;
• data collection takes place in ‘natural’ settings;
• data are obtained directly from respondents;
• surveys often yield data that suggests new hypotheses;
• if mailed questionnaires are used to collect data, the cost per subject
of data is relatively low (compared, for example, to interview data);
and
• A variety of systematic data collection methods (e.g. interviews,
questionnaires, and observation) can be used alone or in combination.
Disadvantages include:
• decreased willingness and refusal of people to respond to sample
survey probes, because of suspicion, fear and other form of resistance;
• most surveys are one shot, as a result their capacity of generating data
with which to test causal connections among variables are limited;
• in terms of total costs, the sample survey is an extremely expensive
research strategy because of large administrative and personal costs;
• the standardized response formats of many sample survey measures
(e.g. questionnaire and structured interviews) may force respondents
to subscribe to statements they don’t fully endorse;
• if questionnaires are used to collect data, the proportion of returned
questionnaires may be low;
95
• questionnaire and or interview measures may poorly elicit constructs
studied by a researcher using the sample survey strategy;
• control over nuisance or confounding variables is poor; and;
• no independent variables are manipulated by the researcher using this
strategy and as a result, causal interferences from sample survey-
generated data are difficult to justify.
5.6 STRATEGIC MANAGEMENT
Strategic management can be considered as a collection of decisions and actions
taken by the business management in consultation with all levels within the
company to determine the long-term activities of the company. The desired
results are primarily concerned with an improvement in the competitive position,
the realisation of profit growth in the long-term, with as a result the achievement
of better returns from the capacity utilised. Results of a secondary nature can also
be striven for, which depend on the specific situation of the company.
Strategic management includes three basic elements (Hax & Majluf, 1991):
• the formulation of a strategy;
• the implementation of a strategy; and
• the control and evaluation of the strategy.
Before proceeding to these stages a thorough analysis of the company or the
industry internal and external environment14 must first take place. The
investigation of the internal environment will accordingly result in an overview
of all weaknesses and strengths of the company, while the investigation of the
external environment will result in an overview of all opportunities and threats.
These are the results of the SWOT-analysis.
14 External environment: (for example, the culture, economy, health, sources of funding, demographics, etc.).
96
The external environment consists of variables existing outside the company or
industry, which in the short-term are not under the control of the company. These
variables form the context in which the company exists and functions. Often the
analysis of the external environment results in a detailed description of future
possibilities, without capturing key trends and using them to change the way the
organization thinks and acts. As a result, strategy analysis and strategy
development remain partly independent activities. To ensure that the analysis of
strategic environment is tightly focused and very practical, it is important to
practice what is known as ‘managing today from tomorrow’ (Viljoen & Dann,
2003).
Common analytical techniques are Porter's Model and SWOT analysis.
5.6.1 Porter's Model
Michael Porter described a concept that has become known as the ‘Porter's five
forces model’. This concept involves a relationship between competitors within
an industry, potential competitors, suppliers, buyers and alternative solutions to
the problem being addressed. This became one of the most leading analytical
models for assessing the nature of competition in an industry. Porter (1980 &
1979) explains that there are five forces that determine industry attractiveness
and long-run industry profitability. These five "competitive forces" are (Viljoen
& Dann, 2003):
1. The threat of entry of new competitors (new entrants)
2. The degree of rivalry between existing competitors/sellers in the industry
3. The bargaining power of buyers
4. The bargaining power of suppliers
5. The threat of substitutes
Figure (5.4) below illustrate the five ‘competitive forces’
97
Figure 5.4 Porter's Five Forces Model
Porter, in his five forces model, elaborates on the threats and opportunities which
are determined by the external environment. This view contrasts with the
approach adopted by those who believe the best method of determining the future
of the organisation and the strategic direction is more appropriately based on the
resource-based view of the firm.
As indicated by O’Shaughnessy (1996), Porter argues that “a new theory must
explain why firms from particular nations choose better strategies than those
from others competing in particular industries”. He believes that “much
traditional thinking has embodied an essentially static view focusing on cash
efficiency due to factor scale advantages”. His sharpest area of stress is the
importance of competitiveness, a theme he repeatedly returns to, and he thinks
that “new theory must make improvement and innovation in methods and
technology a central element”.
That there are interdependencies cannot be denied but the importance for any
particular industry would have to be established empirically. It is the same with
all the other influencing factors mentioned by Porter. They are not so much
factors, as variables whose value can vary substantially as Porter often shows.
98
While each industry involves all of these factors, the relational strengths vary. In
any case we have no means for predicting how a complex system like this will
behave even when we fully understand all the various parts. One of the key
criticisms of Porter is his inattention to the cultural dimension, a significant
omission.
De Toni & Tonchia (2003) mentioned that those in favour of competence theory
‘CT’ list a series of limits of Porter’s theory, also known as industrial
organization ‘IO’ because of the importance it gives to industries; these limits are
linked to the way of understanding the corporate strategy and can be summarized
as follows:
• the strategy concerns the competitive positioning of the firm within an
industry of a given structure: this is ever less true, given the difficulty of
defining the boundaries of industries and in addition their instability;
• the strategy aims at existing industries: in this way many possibilities are
neglected; and
• the strategy is the result of an analytical process, while its execution is an
organizational process: the phases of formulation and implementation of
the strategy cannot be separated or made sequential, according to the
Porterian scheme “structure-conduct-performance” (Prahalad & Hamel,
1994).
Viljoen & Dann (2003) stated that according to Porter (1990), economic success
depends, on certain hard factors such as infrastructure, resource availability, local
demand which refers to the home country’s demand for products and services
within an industry, the presence or absence of related and supporting industries
and competition within the domestic economy. According to Viljoen & Dann
(2003) Porter’s theory of international competitive advantage has been subject to
criticism that the theory applies only to industrialized and not to resource-base
economies. Also, in his investigation (Sajjad M. Jasimuddin, 2001) concluded
that all these factors can be measured with some degree of confidence for
developed economies; therefore, Porter’s model may be applied quite effectively
99
to these developed countries. The main lesson, then, is that Porter’s model seems
incomplete; it is a good diagnostic tool but does not always provide the guidance
needed to develop economic and industrial policies. Any application of the
model needs the addition of a qualitative assessment of the cultural, social and
educational factors that contribute to economic success or failure.
A different analysis for developing strategies could be carried out by using
concepts from the strategic management; namely, the strengths, weaknesses,
opportunities, threats (SWOT) analysis. This approach does not contradict but,
rather, supplements Porter’s analysis.
5.6.2 SWOT analysis
SWOT is an abbreviation for Strengths, Weaknesses, Opportunities and Threats.
The SWOT analysis is an important tool for auditing the overall strategic
position of a business and its environment by which we synthesize all the
conceptual parameters on the frame of strengths, weaknesses, opportunities and
threats. To develop a plan that takes into consideration many different internal
and external factors, and maximizes the potential of the strengths and
opportunities while minimizing the impact of the weaknesses and threats. SWOT
analysis can be simply understood as the examination of an organization’s
internal strengths and weaknesses, and the opportunities and threats faced by the
organization due to its environment. Originally designed for use in an industrial
environment, it is used in the preliminary stages of decision-making and as a
precursor to strategic planning in various kinds of applications (Johnson &
Scholes, 1989). SWOT analysis can be used in conjunction with other tools for
audit and analysis, such as PEST analysis and Porter's Five-Force analysis.
It is important to clearly identify the subject of a SWOT analysis, because a
SWOT analysis is a perspective of one thing, such as a product, a proposition, an
idea, a method, or option, etc.; however, it must be recognized that SWOT
100
introduces many subjective viewpoints and does not necessarily yield ‘scientific
truth’ Gibis et al (2001).
A limitation of this approach is the choice of perspective, in this case the
assessor’. An ‘opportunity’ could be a ‘strength’ depending on the stage of
development of the particular construction industry development initiative.
Likewise, a ‘threat’ could be an ‘opportunity’ depending on the perspective and
attitude of the assessor, and the circumstances of the environment. Making a
SWOT-analysis involves significant symbolic processing, complexity, judgment
and uncertainty. Furthermore the SWOT-analysis does not contain much serial
numeric computation which would make it convenient for classical data
processing techniques (Houben et al, 1999).
The SWOT analysis is usually performed based on identification of relevant
factors of the external and internal environments by a baseline survey, and on
generating a specific list of items gathered via a group process, interviews and
literature. This is found to be difficult for this research due to distance issues to
conduct interviews and lack of literature. The nature of a SWOT analysis,
therefore, was not the most convincing argument to apply this expert system
methodology for this research. It is worth pointing out that SWOT analysis can
be very subjective; two people rarely come up with the same version of a SWOT
analysis even when given the same information about the same business and its
environment. Accordingly, SWOT analysis is best used as a guide and not a
prescription.
Another potential limitation (also the case with some other group methods) is the
potential ‘unequal’ participation of group members. To resolve conflicts by
discussion, and be able to reach a group consensus, the Consensus-forming
Techniques (outlined in next sections) or other ‘controlled’ techniques (such as
the Delphi) may be helpful to avoid bias due to over- and-under-representation of
constituencies.
101
5.7 CONSENSUS-FORMING ANALYSIS TECHNIQUE
The methodology in this research requires the use of consensus-forming
techniques. This section of the thesis will briefly outline the alternative
approaches in consensus-forming techniques and present the rationale for the use
of the Delphi technique.
The opinions of experts are needed as an input in many policy arenas in which
objective data is unavailable and subjective judgements play a significant role.
Given that individual experts may hold widely varying opinions, it is logical to
seek a consensus of opinions of a panel of experts. The value of consensus-
forming techniques is based on the assumption that opinions of a group of
experts will be more accurate than opinions of individual experts; correcting for
individual bias and misinformation. Group consensus can be obtained in a variety
of ways, three of which will be discussed here. These are :
• the interacting group process;
• the nominal group process; and
• the Delphi process
5.7.1. INTERACTING GROUP PROCESS
According to Delbecq (1968), the interacting approach to committee decision-
making is defined as a group meeting in which all communication acts take place
between members with minimal control or formal structuring. The process of
decision-making in the interacting group is :
a) unstructured group discussion to obtain and pool ideas of participants;
and
b) majority voting on priorities by hand counting.
102
5.7.2. THE NOMINAL GROUP PROCESS
The nominal group process is a structured group meeting in which individuals
work in the presence of others, but do not verbally interact for a period of time.
The nominal process follows a prescribed sequence of problem-solving steps
(Delbecq & Van de Ven, 1971), namely:
a) silent generation of ideas in writing;
b) fixed cyclic order of presentation and recording of independent ideas
on a blackboard or flip-chart;
c) discussion and clarification of ideas; and
d) independent ranking of priorities.
5.7.3. THE DELPHI PROCESS
Unlike the interacting and nominal group processes, where close physical
proximity of group members is required for decision-making, the participants in
a Delphi process are physically dispersed and do not meet face-to-face for group
decision making. The Delphi technique is a method for soliciting and collating
group judgement on a particular topic through a set of carefully designed
sequential questionnaires interspersed with summarized information and
feedback of opinions derived from earlier responses (Rowe et al, 1991).
To perform a Delphi exercise, a panel of experts on the topic(s) under study is
created. Then a set of questions is sent to each member of the panel soliciting
responses. These responses are summarized and provided to the panel in the
second round with a request that reconsideration be given to a respondent’s
individual answers in light of the responses from other panel members and that
possible adjustments be made in second round responses. This process is
repeated as often as necessary to achieve a desired consensus. When responses
103
stabilize, the results of the final round are used as the consensus. In published
literature, three rounds seem to be typical (Van Dijk, 1990).
5.7.4. COMPARISONS OF THE DIFFERENT PROCESSES
Riggs (1983) argues that group decision-making with interactive groups inhibits
creative thinking. The nature of inhibiting influences, which act to reduce the
performance of interacting groups in problem-solving, seem to relate to the
following (Taylor et al, 1958):
• the inevitable presence within most organizational groups of status
incongruities, wherein low-status participants may be inhibited and go
along with opinions expressed by high-status participants, even
though they feel their opinion are superior;
• the influence of dominant personality types upon the group; and
• a tendency to reach speedy decisions before all problem dimensions
have been considered due to meeting time constraints.
The nominal group process facilitates creative decision-making more than
conventional interacting groups. This is due a number of characteristics of
nominal groups (Delbecq & Van de Van, 1971). Nominal group techniques:
• provide each individual time and opportunity to engage in reflecting
and force participants to record their thoughts; and
• allow all participants to share in the opportunity to influence the
direction of group decision outcomes.
The Delphi process tends to avoid the pitfalls of an interacting group and,
simultaneously, contains most of the positive characteristics of the nominal
group process. The major differences between nominal and Delphi approaches to
decision-making are:
104
• Delphi respondents are anonymous to one another, while nominal
group members become acquainted with one another; and
• nominal groups meet face-to-face around a table, while Delphi
respondents are physically distant and never meet.
All communications among respondents in the Delphi process occur via written
questionnaires. In nominal groups, communications occur directly between
members and the leader.
5.7.5. ADVANTAGE OF THE DELPHI TECHNIQUE
Delphi is a qualitative technique that achieves group consensus while avoiding
the hazards of face-to-face interactions, such as group conflict and individual
dominance (Rowe et al 1991). This is important because the expert panel will be
composed mainly of policy makers. In the governments of developing countries,
there are inter-ministerial, personal and departmental rivalries (e.g. central bank
governor, finance minister, and planning agencies are often conflicting, rather
than cooperating forces) (Alam, 1990).
In a Delphi process, experts give their opinion without publicly admitting that
they have done so, thus encouraging them to express a more personal viewpoint
rather than a cautious institutional position (Masser & Foley, 1987). Ethical or
social dilemmas dominate economic or technical in Delphi (Rowe et al, 1991).
For these reasons Delphi is one of the most popular techniques for technological
forecasting. For example, it is estimated that 90% of the technological forecasts
and studies in China are based on Delphi (Yuxiang et al, 1990).
Elsewhere, a methodology using Delphi was applied to Mexico in an attempt to
overcome some of the shortcomings observed in planning and offer a viable
alternative to national, or sectoral planners (Waissbluth & Gortari, 1990). This
study showed that high-ranking officials and researchers can be a part of the
planning process without giving up much of their valuable time.
105
In India, a study by Rohatgi and Rohatgi (1979) discussed the concept of
appropriate technology to developing countries like India. The study concluded
that the Delphi technique is adequate in the identification of such technologies.
Other applications of Delphi technique to problems in China, Taiwan and India
have been reported by Chen et al (1990), Madu et al (1991), and Rohatgi and
Rohatgi (1979), respectively.
One important; though hardly theoretically based reason, for the use of the
Delphi technique is that it avoids the problem of scheduling repeated meetings of
high level governmental, academic and individual experts.
5.7.6. EVALUATING CRITERIA FOR METHODOLGY
Unlike a statistical analysis, the results of policy ranking assessment are difficult
to evaluate with respect to its success. To obtain a more successful process some
measures proposed are:
• the methodology should use the maximum amount of relevant
information available in developing countries (in this case Yemen,
where reliable objective data is difficult to acquire);
• the methodology should be able to account for direct and induced
impacts of the policies; and
• the policies selected for the ranking should be suitable, practical and
if possible have proven effective in developing indigenous
construction industries elsewhere.
5.8 THE RESEARCH METHODOLOGY
This section presents the methodology approach conducted for this thesis. The
overall research plan includes:
106
• clear understanding of the problem being studied;
• a definition of the research objectives;
• description and justification of the point of departure;
• the identification of fundamental research issues;
• a definition of all the elements and components that comprise the
investigation; and
• a clear methodology to perform the investigation.
The proposed approach follows the general outline of previous studies, and
international organisations reports. It is distinguished from these studies in
several ways:
• it concentrates on the capabilities and deficits of the construction
industries in developing countries;
• it seeks information from international agendas and international
reports on sustainable development and sustainable construction;
• it confirms some local potentials, constrains and weaknesses through
a survey on the local industry; and
• it ranks a variety of strategies and policies on their effects on the
indigenous construction industry by consensus of expert opinions.
Saaty and Boone (1990) argue that there are four justifiable ways of forecasting
the future. One is by historical analysis and analogy, the second by extrapolating
on trends, the third consensus and the fourth is the systematic generation of
alternative paths to the future. In this thesis similar approaches will be utilized to
implement the methodology and generate final forecast. The approaches are:
• trend exploration based on historical data on Yemen and developing
countries;
• survey of the local industry to identify the local constrains; and
107
• the development of a consensus of policy ranking forecast based on
experts opinions.
The main activities of this investigation are presented in Figure 5.5 which is a
detailed explanation of the research progress based on the three phases of the
overall plan.
Figure 5.5 Research Main Activities
The research methodology was arranged in three phases:
• Problem definition and research design
• Data collection, local survey and analysis
• Ranking forecast and validation of results
Extensive Literature and data collection
Survey of the local construction industry
Delphi and Experts’ opinion
Analysis and Discussions
Analysis and Discussions of the survey
Analysis and Discussions of policies ranking
Prob
lem
Iden
tific
atio
n an
d R
esea
rch
Que
stio
ns
Conclusion, Recommendation and further research
Economic sustainability approach
Data / information/ knowledge/ experience
Results
108
5.8.1 PHASE (I): PROBLEM DEFINITION, RESEARCH DESIGN
AND LITERATURE REVIEW
In the first phase of the methodology preliminary literature reviewing and data
collection on construction industries and socio-economic indicators on
developing countries were established to define the problem and ascertain the
research questions. Where statistics and data on the construction industry exist,
they provide a background method for forecasting and predicting the future and
the economic and environmental trend of the industry. Trend extrapolation is
based on historical data from local and international economic reports, previous
economic studies and statistical data. Sources such as World Bank, IMF, OECD,
United Nations, mainly UNIDO and UNCHS, were reviewed.
This phase includes the following activities:
• Create a clear understanding and description of the problem.
• Identify the problem.
• Conduct a preliminary literature review: consolidate and extract
information from the main areas of investigation including: developing
countries, construction industries in developing countries and their
economical and technical performance, policies, sustainable
development, and sustainable construction.
• Literature on sustainability. Involves an extensive literature review into
sustainable development and sustainable construction in developing
countries. Sustainable and unsustainable activities together with the
criteria for implementing economically sustainable practices are
identified. Literature investigations on sustainable development and
sustainable construction were used to understand and be aware of ‘What
is an economically sustainable construction industry?’
• Formulate the study questions and propositions: create a description of
the research questions and its objectives based on the problem identified.
Sources of information for this activity include books, journals
109
publications, magazine articles, international reports and agendas from
the UN, the World Bank and IMF.
• Develop research methodology: generate a literature review on general
research methodologies and strategies and their possible application in
construction research:
The type of research question posed.
The extent of control the investigator has over actual behavioural
events.
The degree of focus on contemporary as opposed to historical
events.
• Prepare and present a complete project proposal: generate a proposal that
establishes overall project objectives, research contribution, and a
preliminary research methodology.
Since this thesis focuses on how the construction industry of the developing
economy of Yemen can achieve economic sustainability, two main research
questions must be addressed:
What are the existing development barriers?
and
What policies and strategies should be adopted to stimulate and
sustain the construction economy?
5.8.2 PHASE (II): DATA COLLECTION, STUDY AND SURVEY ON
LOCAL INDUSTRY
The second phase of the research will investigate the local barriers to
development within the existing capabilities. This assessment will be based on
knowledge gained from an extensive literature review, collection of appropriate
110
quantitative and qualitative data, and information on market activities.
The existing documentation on construction activities in Yemen is very limited.
As such, it is difficult to form a framework for this study based on existing
documentation and literature alone; therefore, to build a comprehensive base for
this research, it was necessary to conduct a field investigation and a set of local
surveys.
The core activities in this phase include:
• A continuing literature review: perform an additional literature review
and continue with the review of information more relevant to the
investigation as the research progresses and the scope is reduced.
• The identification of Yemen as the study subject.
• The collection of data.
• Identification of development constraints factors and the design of the
local survey questionnaire and associated letters and instructions
(Appendices C-1 and C-2).
• Piloting: For this study, pilot survey questionnaire was handed out to an
Australian government public administrator to edit and clarify the
structure and general outlook of the questionnaire, along with four
experienced engineers to establish the wider industry viewpoint for this
phase questionnaire.
• Sampling: The survey sample was both randomly and conveniently
selected, aiming at the professionals and stakeholders with good
experience and knowledge in the construction activities. This was done
due to restricting factors (time, cost, distance, and willingness to
participate) that prevented full random selection. The selection of
participants for the quantitative phase, the random sample selection was
implemented so that the results could be generalised to the wider
population.
111
• The conduct of survey: A survey on the Yemeni local construction
industry is conducted among various stakeholders and professions to gain
a realistic understanding of the local difficulties and barriers to
development. Some of the main questions addressed in the local survey
are:
What are the most significant problems affecting the construction
industry development?
What are the most significant problems affecting the material
industry?
Why are there always high wastages in construction activities?
Why are the construction costs high in Yemen?
• Analyse and discuss the survey results and identify major barriers and
deficits in the local industry.
• Identify and select a set of polices and strategies that may stimulate and
sustain the economy of the construction industry.
5.8.3 PHASE (III): RANKING AND VALIDATING THE
IMPORTANCE OF THE POLICIES AND STRATEGIES FOR
ECONOMIC SUSTAINABILITY AND FINAL
DOCUMENTATION
Based on the knowledge gained from the extensive literature review, collection
of appropriate quantitative and qualitative information on Yemen and other such
developing countries, as well as the results of the analysis of the local survey in
phase (II), a set of policies and strategies are proposed for the attainment of
economic sustainability and sustainable development for the construction
industry. The policies are outlined in Chapter 7, in terms of their advantages,
disadvantages, history and appropriateness for implementation.
112
This set of policies and strategies are compiled from the international agendas
such as Agenda 21; as well as policies employed by international organizations
such as the UN (UNCHS, UNIDP), World Bank and IMF.
An iterative group consensus using the Delphi method was developed to
establish the priorities of these selected polices according to the experts’
opinions. All policies and strategies are ranked in the final phase of the
methodology using consensus among a panel of experts. The Delphi method was
selected for this research study for the purpose of validating the importance of a
list of construction sector development strategies and policies, using a two round
approach to answer the questionnaire. The specific process followed in this thesis
is presented in detail in Chapter 8.
The Delphi method consists of a series of repeated interrogations, usually by
means of questionnaires. The method uses a focused questionnaire approach in
order to establish a consensus opinion from experts. The purpose of the
technique is to elicit information and judgments from participants to facilitate
problem-solving, planning, and decision-making.
The Delphi questionnaire was initially discussed and piloted to a University
professor, an experienced Yemeni public manager (who is involved in auditing
and acquainted with various government economic issues) and finally to a
number of qualified engineers. The piloting was done to test whether the
questionnaire was intelligible, easy to answer, and unambiguous.
To perform the Delphi method, a panel of experts was chosen. The personal
character and professional experience of the researcher and the relationship
between the researchers’ background, topic to be investigated, the concepts
identified, and the site of the study are important considerations particularly for
the qualitative Delphi questionnaire, where qualitative data is sought and
acquired through confidential contact. The researcher has had a previous
relationship with most of the expert group while working in Yemen as a lecturer
in Sana’a University and as a consultant in the local industry. This panel is
113
representative of government, private construction firms, local organizations and
academia. This was done to gain a reasonable distribution of expert judgment
and opinion on the industry.
This panel comprised:
• Deputy Minister for Sectoral policies, the Ministry of Planning and
International Corporations;
• the Dean of the Faculty of Engineering, The University of Science and
Technology;
• Professor and Head of Civil Engineering School, the Sana’a University;
• Professor at School of Commerce, The Sana’a University;
• Associate Professors, School OF Civil Engineering, the Sana’a
University; and
• other experienced consultants.
The questionnaire was forwarded to each member of the panel soliciting
responses on the topics under consideration. These responses were summarized
and provided to the panel in a second questionnaire with a request that
consideration be given to a respondent’s individual answers in light of the
responses from the other panel members. This process was repeated as often as
necessary to achieve a desired consensus. When responses stabilized (that is,
when the average ranking and the ranking order of each policy stabilised), the
results of the final round were used as the consensus.
The specific activities for this phase were:
• preparation and design the Delphi questionnaires and associated letters
and instructions (Appendices D-1 , D-2 and D-3);
• Piloting;
• selection of expert panel;
• introductory contact with local experts and representatives;
114
• conduct the first round of the Delphi survey;
• analyse the results from the first round of the Delphi questionnaire;
• conduct the second round of the Delphi survey;
• revise the improved or the confirmed ranking of importance for these
policies;
• discuss the results;
• formulate a strategy and a set of recommendations that will ensure an
economically efficient sustainable construction industry, based on the
available local techniques, materials and human resources, and local
conditions; and
• prepare thesis: document all previous research activities and develop a set
of conclusions and suggestions for further research.
115
CHAPTER 6
SURVEY OF THE LOCAL CONSTRUCTION
INDUSTRY OF YEMEN
The research at this stage of the methodology initially focuses on determining the
existing major impediments to any intended development of the construction
industry in Yemen; hence any solutions strategy and policy formulation will be
within the local conditions and capabilities.
The problems of contractors in the construction industry in developing country’s
economies have been grouped by Ogunlana and Olomolaiye (1989) and
supported by Ogunlana et al. (1996) into three major problems:
(i) Problems imposed by the industry's infrastructure, e.g. training, plant
availability, materials supply and communication.
(ii) Problems from the project, of inaccurate information and frequent changes in
instructions and failure to meet obligations on the part of clients and
consultants.
(iii)Problems created by team members.
Although it is true that the problems in Yemen on the broad-spectrum are in
agreement and compatible to this classification, little or no investigation has
116
approached or pointed out the components or the sources that are causing failure
and strains in each of these classes.
The chaos and loss of identity coupled with the rapid transfer to modern
technology within the pressing and crucial need for infrastructure and housing
projects has led to the incapability to monitor, control, nor recognize the faults,
weakness and limitations within the construction development process, all
coupled with the rising cost of land, materials, and lack of capital and research.
Due to the lack of existing data and research in this sector, it was felt that a
survey into the construction industry local issues was needed to provide some
insight into the current local obstacles. It was envisaged that the results obtained
would generate some information about the various recurrent issues that affect
the industry. Also the main aim of the survey is the challenge in exposing these
most frequent and persistent problematic factors, true difficulties and
interruptions confronting the professionals and stakeholders; and therefore,
comprehend the real local conditions and circumstances in industry.
6. 1 METHODOLOGY
The survey has been used to scrutinize the views and knowledge of the
stakeholders and professionals in the construction industry. Data was collected
using a structured survey. The survey questionnaire was distributed to selected
professionals and stakeholders operating in the Yemen capital of Sana’a as well
as in Aden city. The survey contained questions relating to major issues affecting
the local construction and material industry’s performance as well as questions
relating to the factors causing high construction waste and cost.
Initially, the survey incorporated selected variables and criteria which were
compiled from existing literature. The literature reviews in Chapter 3 and in
particular {World Bank reports by Kirmani (1988), the UNCHS (1984a and b &
117
c), Wells (1986) and Okpala & Aniekwu (1988)} were used to put together a list
of factors that affect various issues of the construction industry in developing
countries. In addition the data and indicators accumulated in Chapter 4 on
Yemen in relation to economic, socio-economic and technical issues, and
conclusively the experience judgment gained from the researchers’ work in the
local industry were all employed to formulate the selection of the questionnaire
factors that are most related to the local industry. To encourage participants to
respond quickly, the survey was made as simple and clear as possible. Further,
the survey was designed to enable respondents to add any further variables or
suggestions that they considered necessary for inclusion.
The survey was distributed in two manners; electronically (email) and indirectly
via local representatives who delivered, collected and posted back the surveys by
mail. A total of 49 responses were received, five of which had to be discarded for
being incomplete, leaving a total of 44. (21 were professional and experienced
engineers working in small and medium size private design and construction
firms and/or government projects; and the other 23 were stakeholders who have
been involved in construction activities including the informal construction of
housing units, including 2 project owners). While the choice of the survey
location was mainly in the capital city of Sana’a, where major construction and
economic activities were taking place, the participants were in fact from different
parts of the country and are currently working in the capital; therefore, the
survey unintentionally embraced various parts of Yemen.
6. 2 THE SURVEY STRUCTURE
The survey (Appendix C-2) comprised two sections. Section A of the survey
consisted of four interrogations:
Q.1. Barriers to the construction sector development
Q.2. Barriers to building materials industry development
118
Q.3. Causes of high construction cost
Q.4. Causes of construction waste
Each interrogation had a set of selected factors/variables for which the
participants had to give a ranking according to its perceived effect on the
industry and construction activities. These variables are outlined in later parts of
this chapter.
Section B of the survey consisted of quantitative types of questions concerning
construction costs and labour techniques. The surveys were initially in English
but then translated into Arabic as most participants had no English background.
6. 3 ANALYSIS OF RESPONSES FROM SECTION A
Respondents were asked to indicate their judgment on the factors for each
interrogation. A frequency distribution of the responses was used to assess the
prevalence of these factors. Factors were identified as “important factor”,
“medium importance factor”, or “low importance factor”. For each factor, an
importance index was determined by calculating the total percentage of
respondents.
Following the frequency recording and percentage calculation, an “Importance
Index” is used to find the relative importance and ranking of each variable. The
“Importance Index” is calculated as the mean value of the respondents’
importance rating:
Importance index =
Where w is the weighting, ranging from 1 to 3, given to each factor; W is the
highest weight, that is, 3; f is the frequency of the response; and F is the total
100 ∑ ( w f ) WF
119
number of respondents. When a tie occurs, ranking is in accordance with the
percentage of respondents rating the variable as very important (i.e. 2 or 3).
6.3. A (1) BARRIERS TO CONSTRUCTION DEVELOPMENT
The first interrogation asked the participants to give a ranking to the factors that
they thought were the major barriers to construction industry development in
Yemen. Kirmani (1988) and Wells (1986) have listed most factors influencing
the construction industries in developing countries. For the Yemen case the main
factors seen as relevant and significant for investigation are:
• the availability of materials;
• the availability of skilled labour;
• the availability of specifications;
• inadequate supply of affordable land;
• inadequate supply of infrastructure;
• inadequate finance system;
• poor utilization of local building materials;
• poor utilization of local building technologies;
• inappropriate law and legislation;
• lack of focused research and experimental projects;
• informal sector; and
• administrative problems and bureaucracy.
Table 6.1 and Figure 6.1 summarize the responses in respect of the most
important factors considered barriers as perceived by the participants surveyed.
In general, it was found that there was moderate agreement between
professionals and stakeholders about most factors that could cause barriers to the
development of the construction industry.
120
Table 6.1 Responses to the Development Barriers %
Factors
Hig
h fa
ctor
med
ium
fact
or
low
fact
or
Impo
rtan
ce i
ndex
Ran
king
The availability of materials 3 69 28 58 12
The availability of skilled labour 31 59 10 74 8
The availability of specifications 23 69 8 72 10
Inadequate supply of affordable land 38 41 21 73 9
Inadequate supply of infrastructure 69 28 3 89 2
Inadequate finance system 59 38 3 85 4
Poor utilization of local building materials 33 33 33 67 11
Poor utilization of local building technologies 8 54 38 56 13
Inappropriate law and legislation 69 21 10 86 3
Lack of standardization of local materials 44 54 3 80 6
Lack of focused research 38 59 3 79 7
Informal sector 56 41 3 85 5
Administrative problems and bureaucracy 79 18 3 92 1
121
Figure 6.1 Importance Index for Construction Development Barriers
Administrative problems and bureaucracy (including corruption) was ranked the
most important barrier to construction development. Excessive bureaucracy is a
cause of project delays at all phases and is characterised by an abundance of laws
and regulations, excessive paperwork, too many permits and overlapping
authority of government agencies.
The second most important barrier was inadequate infrastructure. A lack of
infrastructure such as paved roads or electricity and water supply, road access
and associated damage to vehicles, delay and difficulty of delivery of resources
constitute inadequate infrastructure. The lack of infrastructure has inflated inner
and urban land prices and increased the load on existing infrastructure which is
already starting to deteriorate.
The ineffective penalty on delay or damage and the frustration in the dispute
resolution processes, which have always been blamed on inefficient and
0%
20%
40%
60%
80%
100%
The availability of materials (12)
The availability of skilled labour (8)
The availability of specifications (10)
Inadequate supply of affordable land (9)
Inadequate supply of infrastructure (2)
Inadequate finance system (4)
Poor utilization of local building of local building materials (11) Poor utilization of local
building technologies (13)
Inappropriate law and legislation (3)
Lack of standardization of local materials (6)
Lack of research and experimental projects (7)
Informal sector (5)
Administrative problems and bureaucracy (1)
122
ineffective construction laws and construction legalisation, ranked third with a
relatively high importance index of 86%.
An inadequate finance system ranked fourth. Clients, investors and contractors
often experience a lack of financial support from institutions or there are very
difficult conditions associated with getting a loan or assurance certificate,
thereby requiring contractors to carry out the project or investment using their
own funds. In doing so, contractors often cut corners in an attempt to reduce
costs and risks. Formal and informal contractors have very limited and unreliable
credit facilities and cash flow problems which lead to difficulties in financing the
project; suspension of work is always possible by the owner, due to the owner’s
inability to sustain financing on the project. Deterioration of financial incentives
to complete the project is usually the result of poor planning, but it may also be
caused by unexpected changes in the economy, market and demand conditions
(Chalabi & Camp, 1984). Inadequate economic analysis of the project or over-
estimation of the financial capacity of the owner are also symptoms of poor
planning.
The informal sector ranked fifth. This is due to a mixture of absence of
regulations, difficulties in obtaining permission, difficulties and expenses
involved in using the formal sector. From other supplementary surveys the
responses show that the formal sector is straggling behind due to the increasing
overheads (mainly office rent and salaries) and other excessive official costs such
as taxes and registration fees. Discontinuity of work is another major problem for
the formal sector, where on the other hand the informal sector has the flexibility
to shift to other economic activities.
The lack of standardisation of local materials and building components ranked
sixth. This factor often causes an increase in construction costs and waste, an
example of this is that all the final building components such as doors and
windows are controlled by the final site measurements rather than on the
nationally or locally agreed standards and specifications.
123
Ranked seventh was the lack of research and experimental projects, where there
may be new and more appropriate building techniques and materials that might
optimize resources and minimize waste and cost, instead, any research conducted
is often too theoretical or unrealistic for the local needs and capabilities.
Despite the return of experienced construction workers from the gulf after the
first Gulf War in 1990-1991, the scarcity of skilled labour and skilled contractors
continue to exist. Scarcity of labour ranked eighth. Most of the returned labour
could not find continuous work due to political and economical instability and
the increased financial or legal risks in construction works. These circumstances
made construction labours look for other employment.
Ranked ninth was the lack of affordable and legally authorized land in terms of
access to commercially viable and reasonably priced land due to shortages
created by government assistance and protection and real estate speculation.
According to a recent survey by the World Bank (2002a), the majority of firms
rent land (68%); availability and inadequate access to land appears to be a
significant obstacle to firm expansion in Aden, Taiz and Hadramout. Although
land ownership is not insured against multiple claims, nearly 4% of the sample
firms reported problems with multiple claims on their land. Land disputes are
also costly to resolve (World Bank, 2002a). Similar situations exist in human
settlements and public buildings. In addition, a lack of infrastructure such as
paved roads or electricity mains have inflated urban land prices. Water supply
and sewage are also considered a problem.
Technical factors such as the availability of specifications, poor utilization of
local building materials and technologies were ranked low at tenth and eleventh.
Participants believe that these factors are not of major concern or can be easily
enhanced. There was a general indication of satisfaction towards construction
materials availability which ranks 12th.
124
6.3. A (2) LACK OF CONSTRUCTION MATERIALS
INDUSTRY
This section of the survey investigated the reasons behind the lack of achieving
satisfactory manufacturing and production capacity in local building materials.
The factors were carefully chosen from a blend of work experience and extensive
literature reviews and international reports. Most factors were mainly extracted
from (World Bank, 2002a), Wells J. et al. (1998) and the UNCHS reports (1984
a, b & c) on developing countries. The identified factors are:
1. market problems;
2. financing;
3. difficulties in acquiring skilled labour and technicians;
4. poor plant locations and land problems;
5. poor local conditions and infrastructure;
6. lack of studies and information; and
7. administrative problems and bureaucracy.
As indicated in Table 6.2 and Figure 6.2, the factor considered most important
was excessive bureaucracy which creates difficulties in obtaining work and plant
permits. Ranked second was poor local conditions and infrastructure, lack of
access roads and adequate electricity and water supply and any other services
necessary to establish any economic activity.
125
Table 6.2 Responses on Lacking of Building Materials Industry
%
Factors
Hig
h fa
ctor
med
ium
fact
or
low
fact
or
Impo
rtanc
e in
dex
Ran
king
Market problems 13 82 5 69 7
Financing 49 49 3 82 4
Difficulties in acquiring skilled labour and technicians 49 33 18 77 5
Poor plant locations and land problems 21 72 8 71 6
Poor local conditions and infrastructure 56 44 0 85 2
Lack of studies and information 54 38 8 82 3
Administrative problems and bureaucracy 59 41 0 86 1
Figure 6.2 Barriers to Local Building Materials Industry
0%10%20%30%40%50%60%70%80%90%
100%Market problems ( 7)
Difficulty in getting materials (8)
Financing (4)
Difficulties in acquiring skilled labour and technicians (5)
Machinery lacking (9)
Poor local conditions and infrastructure (2)
Lack of studies and information (3)
Administrative problems and bureaucracy (1)
Poor plant locations and land problems (6)
126
Ranked third was the lack of information. The World Bank (2002a) has already
pointed out Yemen’s less-developed market institutions, and how firms face
specific uncertainties due to lack of information. These include the inability to
identify markets; insecurity and unenforceability of contracts; and the lack of
specialized business skills, such as accounting and bookkeeping, marketing, and
exporting. Such factors increase the uncertainty faced by the firms about their
future earnings and prospects, and once again encourage them to consider low-
risk, short-term activities. Reducing such firm-specific uncertainties would
require a range of institution building, and the need to make available planning
and business resources to the firms.
Inadequacy of the finance system was ranked fourth. Investors always experience
a lack of financial support from institutions or there are very difficult conditions
associated with getting a loan. Both formal and informal investors have very
limited and unreliable credit facilities and cash flow problems which lead to
difficulties in financing the project; and inability of the investor to sustain
financing on the project.
Difficulties in acquiring skilled labour, technicians and absence of foremen are
ranked fifth. According to UNCHS (1984a) this problem actually exists in many
developing countries. The factor ranked sixth was poor plant locations, access
roads, basic infrastructure, illegal ownership and land problems.
Ranked seventh was marketing problems; although the World Bank (2002a) has
already cited Yemen’s less-developed market institutions, and how firms face
specific uncertainties due to lack of information. This factor is ranked
unexpectedly low or perhaps underestimated.
6.3. A (3) CAUSES OF HIGH CONSTRUCTION COSTS
In Question A-3 of the survey, participants were asked to give a ranking to the
factors they thought most responsible for high construction costs. Elinwa & Buba
127
(1993) as stated in Chapter 3 indicated that the cost of materials, fraudulent
practices and fluctuations of materials prices are three of the most important
factors leading to high costs in Nigeria. Also Okpala & Aniekwu (1988) and
Mansfield et al. (1994) put together a list of factors that affect construction cost.
It was agreed by most participants that the most important factors causing high
costs were inflation and price fluctuation, imported materials and excessive
waste. Factors that emerged clearly as not very important were labour cost and
local materials cost. Table 6.3 and Figure 6.3 summarise the results.
Table 6.3 Responses on Construction Cost Factors %
Factors
Hig
h fa
ctor
med
ium
fact
or
low
fact
or
Impo
rtan
ce
inde
x
Ran
king
Expensive local materials 8 77 15 64 8
Expensive imported materials 79 21 0 93 2
Cost of labour 3 54 44 53 9
Excessive wastage 59 41 0 86 3
Inefficient designs 28 49 23 68 6
Inefficient Local construction methods 18 79 3 72 5
Expensive and inefficient transportation and delivery 23 56 21 68 7
Inflation and fluctuation of prices 92 8 0 97 1
Lack of cost effective methods 54 46 0 85 4
128
Figure 6.3 Importance Index for Construction Cost factors
Inflation and price fluctuations were identified as the most important factors by
participants (a score of 97% in the importance factor) and were ranked first as
shown clearly in Table 6.3 and Figure 6.3. The inflationary trend is probably due
to demand exceeding supply, artificial scarcity of goods, unstable economy and
political instability. Furthermore, fluctuation in prices affects the prices of raw
materials, labour and services and other ancillary materials.
The consequences of expensive imported construction materials was ranked
second (a score of 93% in the importance index). The expensive imported
materials lead to the selection of cheap substitute materials which are often poor
in quality and less durable. Accordingly the life-cycle costs required for
maintenance and replacement on the whole increase.
Expensive imported material identified in the local market could be due to:
• market failure to satisfy demand;
• high fiscal taxes;
• difficulty in getting materials through ports; and / or
0%
20%
40%
60%
80%
100%Expensive local materials (8)
Expensive importedMaterials (2)
Cost of labour (9)
Excessive wastage (3)
Inefficient designs (6)Inefficient local construction
methods (5)
Expensive and inefficient transportation and delivery (7)
Inflation and fluctuationof prices (1)
Lack of cost effective methods(4)
129
• corruption associated with issuing permits.
The third ranked factor was the excessive waste due to a lack of efficient
execution and skilled labour, supervision, lack of management and planning of
the project procurement and absence of reuse mechanism. The fourth factor was
found to be the lack of cost effective methods, which were generally based on
direct cost estimation of executed quantities and on basic bill of quantities tables,
ignoring hidden costs and waste in the project. Due to the approximate
evaluation, contractors increase prices as protection against cost overruns,
corruption, inflation and delays from bureaucracy; quantity surveyors and
accountants are hardly ever involved in the construction phases.
Inefficient local construction methods were ranked fifth, with an importance
index of 72%, with 79% of respondents giving it a medium ranking. Inefficient
designs were ranked sixth. The author had expected a higher ranking for this
factor, due to a well known tendency for Yemeni professionals to design without
adequate information and knowledge on available materials or soil conditions;
often resulting in wastage and over design. Nor is there any optimisation for local
materials during the construction process due to weak or lack of control during
the construction process. Only 28% of stakeholders have indicated that there are
problems in the designs and that development of the design should come from
more research on local capacity. Recognition that design and documentation was
a major factor in increasing cost and a reason for excessive construction waste,
was acknowledged by 23% of respondents.
There were also indications of general satisfaction towards the cost of local
construction materials which was ranked eight out of nine factors; this is even
with the high reliance on imported material components of most of the locally
manufactured products. Difficulties in the construction materials industry
investments (such as lack of finance, taxation, red-tape, difficulty of acquiring
permission and lack of cheap land and infrastructure) made all the participants
appreciate; or rather accept, the current situation in the local construction
materials.
130
The lowest ranking factor was the labour cost, where all the participants agreed
on the low local market cost of labour. All participants agreed that the labour
cost is the least cause of high cost. Despite the low cost of the labour, section (B)
of this survey suggests that there is little interest in using labour-intensive
technology.
Some participants added that, because of the difficulty of registration and
obtaining permission, contractors increase prices as protection against cost
overruns caused by corruption, inflation, delays from red-tape, and discontinuity
of work.
6.3. A (4) CAUSES OF CONSTRUCTION WASTES
The third question in section (A) of the survey was used to determine the factors
causing construction waste. Waste has been defined by Serpell & Alarcon (1998)
as ‘anything different from the absolute minimum amount of resources of
materials, equipment, and manpower necessary to add value to the product’.
Alwi et al. (2002) also indicated that waste is not only associated with waste of
material in the construction process but also other activities that do not add value,
such as repair, waiting time and delays. In general, all construction activities that
produce cost, direct or indirect, but do not add value or progress to the product
can be called waste. Any improvement effort should be focused on identifying
waste in the construction process, analysing the causes that produce this waste,
and acting over these causes to reduce or eliminate them (Serpell & Alarcon,
1998).
The participants were required to give a ranking for the following variables:
• lack of planning and management;
• resources misused;
• unclear information and information quality problems;
131
• resources quality problems;
• lack of execution skills;
• lack of control and supervision; and
• inefficient procurement and unnecessary transportations.
On ranking the factors causing construction waste, professionals agreed narrowly
on most of these factors, and the results ranged between 62% and 80% for the
importance index values as indicated in Table 6.4 and Figure 6.4.
Table 6.4 Responses on the Causes of waste %
Factor
Hig
h fa
ctor
Med
ium
fact
or
low
fact
or
Impo
rtan
ce
inde
x
Ran
king
Lack of planning and management 44 54 3 80 1
Resources misused 49 33 18 77 3
Unclear information and information quality problems 41 49 10 77 4
Resources quality problems 31 67 3 76 5
Lack of execution skills 31 64 5 75 6
Lack of control and supervision 46 41 13 78 2
Inefficient procurement and transportations 31 33 28 62 7
132
Figure 6.4 Importance Index for Construction Waste
Although there is no significant difference between the top five ranked factors,
the lack of early planning and poor contract management was ultimately ranked
first, principally from a lack of awareness on the part of contractors. Good
project management entails planning, coordinating and controlling all aspects of
the work and could lead to significant improvement in productivity without
necessarily increasing input. Local formal and even more informal contractors
lack managerial skills that might increase productivity and prevent time and cost
overruns. Inadequate economic analysis of the project or over-estimation of the
financial capacity of the owner is also a symptom of poor planning. Adequate
contract management is very important since most other variables result from
lapses in the management of the contract by either the client or the contractor.
Lack of managerial skills has been highlighted by the World Bank (1984) and
Ofori (1991) as a major deficiency of local construction enterprises in developing
countries
Ranked second was a lack of control and weak supervision of site activities.
According to some participants this can be due to the fact that qualified engineers
0%
20%
40%
60%
80%
100%
Lack of planning andmanagement (1)
Resources misused (3)
Unclear information and information quality problems
(4)
Resources quality problems (5)
Lack of execution skills (6)
Lack of control andsupervision (2)
Inefficient procurement and transportations (7)
133
and technicians conducting supervision work often get underpaid or they limit
their supervision according to payment. There is a low use of foremen and
qualified technicians in these basic jobs for controlling minor labour work on
site. Others indicated that poor contract management produces deficiencies in
contractor’s plan, cost control and overall site management, and some argued
that this could be due to the lack of adequate experience or absence of
specialisation.
Resource misuse was ranked third; resource misuse is indicated by some
participants to be due to unnecessary or inefficiently managed labour use onsite,
and inappropriate materials storage, transportation delivery and excessive misuse
of construction materials.
Unclear information was ranked fourth despite the fact that this factor is often
used by contractors as an excuse for delay or choice of low quality materials. It is
argued that this problem can be improved if professionals are more prudent in
their designs, and more knowledgeable of material availability, suitability and
usage. The designers should be more familiar with building products and best
construction techniques, which will enable the projects to be built more
efficiently and with less waste. The existence of local standardisation and
specifications also emerged as necessary.
The fifth ranking factor was resource quality and information problems, for
example, cement is the basic binding material in concrete, therefore the quality of
concrete is dependent upon the quality of the cement used. In developing
countries such as Yemen, the quality of construction materials, including cement,
may not conform to international standards because of poor quality control,
governmental corruption, and problems associated with transportation and
storage, water quality and building materials components due lack of control and
testing and restrictions on specifications.
Lack of execution skills ranked sixth, and inefficient procurement was ranked
seventh. This could be due to the fact that the participants were unable to
134
recognise the importance of this factor. For a project to run efficiently, it is
vitally important to monitor and understand how information flows between
project participants.
6. 4 ANALYSIS OF RESPONSES FROM SURVEY SECTION (B)
The purpose of the section of the survey was to get some insight into
construction issues and practices as conducted by the local contractors and
stakeholders. Issues such as:
• the construction methods and technologies;
• the distribution (breakdown) of construction cost; and
• the reliance on informal or formal sector in construction projects.
The following sections will discuss the interrogations presented in section B of
the survey.
6. 4. B (1) LABOUR TECHNOLOGIES AND EMPLOYMENT IN
YEMEN
Earlier in Chapter 4, Table 4.4 gave an indication of the high proportion of
unskilled labour in the local market, and Appendix (A-1) indicated that
unemployment in Yemen has reached 33%.
Regardless, survey participants were asked to indicate the construction
technologies they were using in the execution of a construction project. The
responses indicated in Appendix (C-3) show that the majority of the stakeholders
(66.7%) were actually using labour-based15 construction methods and only
26.6% of the stakeholders used labour-intensive methods.
15Labour-Based Technology A construction technology which aims to apply a labour/equipment mix that gives priority to labour, but supplements labour with appropriate
135
This finding raises the question: ‘Is the construction sector efficiently utilising
the full capacity of the excessive labour market?’
6. 4. B (2) BREAKDOWN OF COST BY ELEMENTS OF
BUILDING
The respondents were asked to give their estimate on cost distribution on
structural and finishing elements as experienced in the local market (Appendix
C-3). It was found that despite the high imported content in finishing elements
and the high cost of these imported materials, the structural cost consumed
approximately 53.1% of the total construction. The other 46.9% is consumed by
the finishing process and installation, although the majority of it is imported
materials.
A report for the United Nations Development Program by Tassios (1992),
indicated that the ratio,
λ = cost of structural elements .
cost of finishes and installations
seems to reflect the availability of the resources and level of development. It was
found that in some African countries the ratio was 1:1; in rapidly developing
areas such as Greece λ was 1:2 and industrialized countries λ was 1:4. In Yemen,
λ was 1:0.87. In Table 6.5, the breakdown of cost by elements of building for
some developing countries, gives an indication of the high cost of the structural
components in the developing countries. This is a suggestion that improvement
and development are required in the execution of structural components of
buildings (housing) for reducing the cost and waste.
equipment where necessary for reasons of quality or cost. (International Labour Organization ILO, 1996)
136
Table 6.5 Breakdown of Cost by Elements of Building
Structural
(%)
Finishes and
equipment
(%)
Senegal 49 51
Ghana 53.5 46.5
Kenya 63.2 36.8
Yemen * 53.1 46.9
Developed countries 20 80
Source: Tassios 1992 and Survey (Appendix C-3)
It can be noted that structural elements are the main contributor to the cost,
although non-structural elements such as the sanitary units, ceramics, electrical
element and most finishing items are actually imported. Some elements used in
construction such as steel are always imported, but its contribution to the cost is
justifiable. The assumption here is that the structural elements are always
expensive due to inefficient construction process and over designs, and moreover
the excessive use of resources, overdependence on imports and absence of price
control into the local resources. The over design practices are also due to using
high safety factors against the quality of materials and execution, due to the
absence of local standards and regulating codes. In the same way, the costs of
non-structural materials and products should not be underestimated.
6. 4. B (3) CONSTRUCTION TECHNOLOGY IN YEMEN
Construction consumes up to 90% of the initial investment in a project and
consumes the most time in the overall process (UNCHS, 1984a). This phase,
which incorporates the majority of technologies used in construction can be
broken down into several steps, each with a unique mix of labour, equipment and
materials, and each having technological flexibility.
137
The respondents were asked to give their estimate on the proportion of cost
distribution on materials, labour and profit experienced in the local market. The
average outcomes were tabulated in Table 6.6, together with some records from
other developing countries, for relative comparison. The average material cost in
Yemen according to the survey rises up to 62% and some recorded up to 70% of
the total cost. This allows little room for manoeuvring labour and profit.
Table 6.6 Breakdown of House Construction Costs by Elements
Materials and
machines On-site labour
Overhead and
profit
Ethiopia 63% 20% 17%
Kenya 70% 25% 17%
Ghana 47% 39% 14%
Senegal 58% 24% 18%
*Yemen 61.6 22 16.4
Sources: UNCHS 1984a and * Survey (Appendix C-3)
The local intermediate consumption of materials and supplies ranged from 37%
to 55% of the total value of construction output, with wages and salaries paid to
construction labour accounting for another 19% to 27%. The other major
component of cost in the construction process is the overhead and profit, the mix
of which varies not only among the different steps of construction but also
between the various types of construction, project size and construction
technologies.
138
6. 4. B (4) FORMAL AND INFORMAL SECTOR
According to Wells (2001) the increase in cement consumption together with the
decreased or decline in construction output can be an indication of the
unmonitored or unrecorded informal activities. This could be the case for Yemen
while there is no obvious increase in construction output; (Appendix B-3) shows
the increase production of the local cement from 835,054 tons in 1990 to
1,229,126 tons 1997. Section (B) of the survey (Appendix C-3) has assessed the
proportion of informal sector used by the stakeholders. The survey indicated that
86.6% of the stakeholders rely totally on informal sector; private construction
firms indicated lesser use of informal sector employment, although the private
sector uses subcontractors for employing labour which will often be informal. In
other words, the private formal construction firms use informal labour in indirect
ways.
6. 5 GENERAL FINDINGS OF THE SURVEY
The general conclusion on the barriers of development came as institutional and
administrative weakness, in all forms of bureaucracy and corruption, followed by
the lack of infrastructure required for economic activities and human settlements
integration and well being, third was law and legal matters followed by financial
and funding issues.
In addition, the most important factors causing high construction costs were
identified as imported materials, inflation and unstable economy and construction
waste. Factors that emerged clearly as less important are labour cost, local
materials cost, availability of local materials and standardisation. Participants
thought that industry technical problems are of lesser concern. They also
indicated that economical stability is important for any development because it
creates less risk for investment.
139
The data collected and the use of the survey has allowed the identification of the
key factors and issues affecting and influencing the construction economic
development process. Identifying these factors facilitated the selection of policies
that are reviewed in Chapter 7.
There is a demand for serious strategies and policies to initiate any sustainable
economic development. The adoption of explicit strategies and policies to reduce
the impact of unemployment and consumption of foreign exchange should be
implemented through appropriate and more thoughtful labour employment and
local materials protection or import policies. There is most of all an urge for
institutional and administrative and human development to facilitate and monitor
any required development. Construction regulations and laws can affect the
choice and quality of the materials and will enable the designers to have more
confidence in executing optimum designs. Monetary and fiscal policies should be
designed to facilitate economic activities, control market prices, inflation and
increased informal activities (due to absence of regulations create difficulties in
conducting formal activities).
Moreover, the local development of the construction material industries should
be adjusted and controlled by new and adequate choice and implementation of
policies and strategies that balance local industry protection policies and open
markets. Yemen should seek to improve on the labour input in construction and
only adopt those technologies that are relevant. The development of the
construction sectors in Yemen should be aimed at optimising the utilisation of
indigenous construction related resources and materials in their efforts to
improve optimise their utility, uses and minimize or control importation.
140
CHAPTER 7
STRATEGIES AND POLICIES TO SUSTAIN THE
ECOMOMY OF THE CONSTRUCTION INDUSTRY IN
YEMEN
Based on the findings of previous chapters on local needs and constraints of the
construction industry in Yemen, this chapter lists and discusses the policies and
strategies that could possibly be implemented for stimulating and sustaining the
economic development of the construction sector in Yemen. These policies and
strategies are principally derived from literature and international agenda such as
Agenda 21 for Sustainable Development; and also extracted from international
organizations reports such as the UNCHS, UNDP, UNIDP, the World Bank and
the IMF. Moreover these policies are proposed in response to the data gathered in
Chapter 4 and the survey on the local Yemen industry in Chapter 6.
The objective behind these policies is to attain progress aligned with sustainable
development process. This set of policies and strategies is to be ranked in the
final phase of the proposed Delphi methodology in Chapter 8 using consensus
amongst a panel of Yemeni experts.
Initially a range of policies were selected; utilizing the researcher’s experience,
observations and knowledge on the local industry, and discussions with the
research supervisors, the number of policies were rationalized to eight of the
most appropriate and needed policies. Some of other policies that were found
141
less important and/or found beyond the research’s’ capacity, such as urbanisation
and private sector intervention policies were put for further investigation and can
be found in Chapter 10. Policies that were eliminated and found impractical
within the short term implementations and the economic and security
environment were aimed at attracting foreign investment and using joint venture
arrangements in construction.
The nature of the selected policies, a description of the benefits derived from
implementation of these policies, and a discussion of their limitations and
suitability for developing countries in general; and Yemen in particular, are also
outlined in this chapter.
7 . 1. SELECTION OF APPROPRIATE POLICIES AND STRATEGIES
The construction industry, together with the material production industries which
support it, are some of the major global exploiters of natural resources. In spite
of differing perceptions about the precise meaning of the term sustainable
development, it is now generally agreed that development in the poorer nations
must proceed in parallel with a general global application of new technologies
that are both less resource intensive and less environmentally damaging.
To improve the construction industry, many other sectors of the economy require
attention, and some of them need to be given a boost earlier than construction,
whilst others must occur later. According to Hillebrandt (1985) there is a need
for complex synchronization of policies and initiatives. To encourage
development and selection of construction technologies that are consistent with
national development goals, policy makers should develop a full understanding
of:
• technological alternatives available for construction;
• economic consideration governing the choice of technology in
construction industry;
142
• institutional adjustment to policies and institutional arrangement and
issues which bear on construction policies and the construction industry;
and
• economical benefits and capabilities.
Developed countries have been able to move the construction industry in
response to global environmental concerns with a range of policy initiatives and
instruments. Through legal, planning, and economic institutions, strong fiscal
and regulatory policies have been employed to move the construction industry
towards environmentally sustainable practices. According to Ebohon &
Rwelamila (2001) the significance of institutions as a necessary prerequisite to
environmental sustainability is often ignored, especially in the case of the
developing countries where they are assumed to be present, allowing policies;
largely incongruent to the peculiarities of these economies, to be formulated.
They specified that Sub-Saharan Africa is a typical example of where policies
that give no recognition to the lack of financial, human and institutional
capacities are openly advocated.
Policy and strategy alternatives are to consider what is available. Certain
technologies require specific skills and should include not only the technological
capabilities but also the managerial and labour requirements of each technology.
There is a need to initiate the role of government control over sustainable
economic activities through the use of efficient and suitable administrative, legal
and economic measures. Fiscal policies appear to be prominent and are used
extensively to encourage good sustainable practice in the construction process.
The construction industry in Yemen is also very dependent on the importation of
construction components and materials, thus necessitating the search for policy
and strategy alternatives to consider what is available, and what can be
developed, given adequate funding and resources.
143
The findings from literature, trend exploration based on historical data on Yemen
and developing countries, experience and moreover, the surveys regarding the
local industry of Yemen that were conducted in the first and second phases of the
methodology have confirmed the selection of the most effective policies and
strategies to be subjected to the ranking process by experts. The ranking process
was to establish the policy importance and possible implementation.
The eight policies and strategies selected for this dissertation are listed as
follows:
• Labour-intensive construction policies.
• Energy-efficient policies in design and construction.
• Credit and funding policies on selected projects.
• Local materials protection policy.
• Strategies for sustaining affordable infrastructure projects.
• Strengthening the law and regulations in construction and land
affairs.
• Pricing policies and market control.
• Improve administration and institutional effectiveness and reduce all
forms of bureaucratic procedure.
The following sections discuss the policies and strategies selected for possible
implementation in Yemen.
7.1. 1 LABOUR-INTENSIVE POLICIES
This is a macroeconomic policy for the promotion of labour-intensive
techniques, in part by mandating minimum crew sizes in construction projects,
stimulating employment by increasing the labour content per project, reducing
poverty and increasing the competitiveness of indigenous firms against foreign
firms by reducing the advantage of higher productivity by capital intensive
foreign firms.
144
UNCHS (1984a) has indicated that, in developing countries, increasing
employment and re-distribution of income should dominate the choice of
technology in the public works sector. The increase in unemployment, at a time
of increased economic activity, has been attributed by many to the choice of
inappropriate technology. Thus many experts advocate the development and use
of more labour-intensive technologies in their countries.
UN Agenda 21 (Chapter 7, paragraph 69-e, 1992) states that all countries as
appropriate and in accordance with national plans, objectives and priorities
should:
Promote the use of labour-intensive construction and maintenance
technologies which generate employment in the construction sector for
the underemployed labour force found in most large cities, while at the
same time promoting the development of skills in the construction sector
It is also argued that projects should, for developing countries at least, be of
simple technology, and make use of low levels of equipment and high levels of
labour (Ofori, 1990 and Ganesan, 1994). Studies of employment generation from
construction activity in Sri Lanka undertaken by Ganesan (1979, 1982, 1994),
conclude that a significant gain in total employment, of the order of 10-15%, can
be realised through industrial restructuring alone to a more appropriate
technology. Ganesan (1994) also stated that a strategy to increase output through
activities consuming more labour and less scarce resources is the only feasible
way forward in most developing countries. Similar conclusions have been
promulgated by others (Edmonds & Miles, 1984; World Bank, 1984; Hillebrandt
1997, Edmonds & De Veen, 1992; Gaude & Watzlawick,1992).
Hillebrandt (1999) indicated that there is always an appeal for countries with
high unemployment to use labour-intensive technologies. Hillebrandt (1997) has
also indicated that at one extreme, the advocates of the use of labour-intensive
technology wish to enable small, and even informal, contractors to participate in
the construction process. Such technology is usually associated with low capital
145
intensity and lower labour productivity. At the other extreme are those who stress
the need for the construction industry to modernise and grow, so it can undertake
work as carried out in developed countries and by foreign contractors in
developing countries.
7.1. 2 ENERGY EFFICIENT STRATEGIES IN DESIGN AND
CONSTRUCTION
This policy is based on paragraph 7.69.c of Agenda 21 (1992) that is to adopt
standards and other regulatory measures which promote cost and energy-efficient
designs, construction technologies and the sustainable utilization of natural
resources in an economically and environmentally appropriate way. This can be
achieved by mandating the reduction of life cycle cost and total energy used in
the built environment, by utilisation of certain design and construction measures
such as:
• using less materials;
• selecting of low-energy materials and structural systems: such as stone
and mud in the Yemen case;
• designing of low-rise buildings in place of high-rise buildings;
• selecting where possible of waste or recycled materials;
• designing for long life, recycling and adaptability to varying
requirements;
• reducing avoidable transportation of materials and improve fuel
efficiency;
• improving site management efficiency;
• reduction of the quantity of site wastes produced;
• improving insulation standards;
• avoiding use of industrial high performance materials; and
• reducing the tendency to waste expensive materials in low performance
uses.
146
The current economic development of developing countries basically follows the
traditional development model of high resource and energy consumption which
leads to extensive damage to the environment, and makes it difficult to sustain
economic growth. The example of excessive production is the use of Portland
cement in masonry works or in plastering as indicated in Tassios (1992) which
are both technically and economically wrong.
The selection of alternate materials which make use of local raw materials, use
relatively little processing energy and can be manufactured locally, with low
resulting transport costs should be encouraged. Strategies should also include
energy saving and energy-efficiency in building materials manufacture and the
construction process; there is also a major opportunity available to reduce the
embodied energy used in buildings by appropriate choice of materials and
technologies in design.
One of the setbacks for change to energy efficient production of materials
according to UNCHS (1991) is that capital16 costs of change are going to be
considerable but there is still a lot that can be done, especially in developing
countries.
7.1. 3 CREDIT AND FUNDING POLICIES
A policy of credit easing falls under the category of easy monetary policy and is
used to stimulate economic activity by making credit available to businesses.
Credit is an essential resource for construction enterprises. Edmond & Miles
(1984) and Miles & Neale (1991) have identified poor access to funds and
finance as the most serious problem facing contractors and stakeholders in
developing countries. A decrease in money supply tends to reduce developers
16 Capital Man-made means of production. Capital goods are goods designed to be used in production, for example machinery.
147
cash flows, thereby leading to a decline in construction activity (Hillebrandt,
1985).
The International Labour Office (1987) observed that development of an efficient
construction industry requires institutional measures such as the provision of
financial services. These include providing loan guarantee schemes and tax
allowances for contractors. Kermani (1988) advises that a basic strategy for
improvement of the construction industry of developing countries should include
encouraging financial institutions to offer credit to contractors on reasonable
terms. The effects of lower financing costs have been demonstrated through
comparisons in some developing countries in which credit availability differed
significantly.
As an example, Thailand and the Philippines were the subject of a comparative
study by the World Bank (1987). Both had a population of 41 million and GDP
per capita of $310-$330 in 1968; however, from 1968 to 1986 the annual real
growth per capita of gross national product was 4.8% for Thailand compared to
2.2% for the Philippines. According to the World Bank report entitled “The East
Asian Miracle: Economic Growth and Public Policy”, there are several reasons
for Thailand’s better economic performance. In contrast to the Philippines, Thai
banks have been more likely to be privately owned and exercise independent
authority over lending; moreover, in its credit policies, the government of
Thailand targeted small and medium scale enterprises.
This policy of credit easing is also approached in response to a statement in
Agenda 21 for Sustainable Construction in Developing Countries (CIB/UNEP-
IETC, 2002) that:
Most developing countries are suffering from the ill effects of
unsustainable credit-related financial policies.
Agenda 21 paragraphs 3.8 and 7.69 also states that sustainable development
requires increased investment, for which domestic and external financial
148
resources are needed, including credit schemes for the purchase of land and for
building, acquiring or improving safe and healthy shelter and infrastructure
services. Also credit schemes are needed for the informal sector and improved
access to land for the landless poor so that they can acquire the means of
production and reliable access to natural resources.
It must be noted that the policy of credit easing has two potential drawbacks:
• if the banking system does not create safeguards, easier credit can lead to
construction overexpansion and instability; and
• the developing country’s policy toward credit easing may undermine
international financial confidence and result in organizations such as the
International Monetary Fund demanding tighter controls over lending
practices.
The argument that can be made is that credit and funding institutes should always
favour economically sustainable designs and construction projects based on local
inputs, methods and reuse of locally available natural resources.
7.1. 4 LOCAL MATERIALS PROTECTION POLICY
Protectionist policies are used by many developing countries to protect their
industries from outside competition. Such fiscal policies rely on quotas and
tariffs (Kermani, 1988). The quota systems are administered through the
preparation of a list of acceptable, controlled and restricted products. Importers
must apply for licences that are granted for a fee. Tariffs, on the other hand, are
used to provide intermediate to high levels of nominal and effective protection.
Kermani (1988) talks about the merits of construction industry protection
policies. According to Kermani, developing countries consider such protection
essential to strengthen the indigenous construction industry.
149
Although developing countries regard protection as a way to attain self reliance,
many find it an easy way of raising substantial tax revenue from tariff collections
(Todaro, 1997).
The major difficulties with the protection policy is that the indigenous industry
either:
• is unable to provide the product; or
• may provide the product at a substantially higher price and poorer quality
than the imported one.
Agenda 21 noted that protectionist pressures and unilateral policy actions will
continue to endanger the functioning of an open multilateral trading system and
affect in particular the export interests of developing countries. On the contrary,
Agenda 21 (paragraphs 2.3 and 2.12) is actually in favour of promoting
sustainable development through trade liberalization, as stated here:
The international community should halt and reverse protectionism in
order to bring about further liberalization, expand market access and
expansion of world trade, to the benefit of all countries, in particular the
developing countries.
Paragraph 2.12 also adds that all countries should implement previous
commitments to halt and reverse protectionism and further, remove barriers that
restrict imports, particularly from developing countries, of commodity products
in primary and processed forms, as well as the substantial reduction of support
that induces uncompetitive production, such as production and export subsidies.
Moreover, efforts should be made to develop cheap, serviceable, adaptable, and
easily-assembled building materials made of locally-available sources of raw
materials; allowing the high cost of imported materials to be the main factor
forcing a move towards the good quality and durable local materials.
Development approaches should aim at:
150
• improving the traditional building materials quality and methods;
• developing new materials and improved techniques, which will be an
integral part of sustainable building systems; and
• removing some fiscal restrictions on selected construction materials that
can not be manufactured locally.
7.1. 5 STRATEGIES FOR SUSTAINING AFFORDABLE
INFRASTRUCTURE
Physical infrastructure facilities deriving from construction activities occur in
different forms, which can be broadly categorized into two groups. At the first
level are projects in the civil engineering sector involving the construction of
roads, railways, ports, dams, power stations, and drainage and water supply
projects. Generally, such projects – generically referred to as economic
infrastructure – involve huge investment initiatives and are often undertaken by
national governments, which, after having secured the required funds from bi and
multilateral donor sources, contract out the work mainly to international
construction firms.
The second category of physical infrastructure involves construction activities
aimed at the delivery of residential and non-residential buildings, the demand for
which is growing with the growth of population and urbanization.
In developing countries, investment in more and better infrastructure projects; as
well as in the development of capacity for their repair and maintenance, is
important for the sustainable supply of health, education, housing, transport, and
water and power supply services (Bon & Crosthwaite, 2000). Good infrastructure
projects can help enhance the process of industrialization by raising productivity
and reducing production costs.
151
There is growing awareness amongst developing countries about the significance
of sustainable infrastructure for socio-economic development, in general, and for
the effective implementation of poverty reduction initiatives, in particular.
Agenda 21 (paragraph 2.37) indicates wherever appropriate, and taking into
account national strategies and objectives, countries should promote and support
the investment and infrastructure required for sustainable economic growth and
diversification on an environmentally sound and sustainable basis.
Zawdie & Langford (2002) state the importance of sustainable infrastructure for
economic growth and development has been illustrated in the context of Sub-
Saharan African countries. Where the infrastructure system is poor, as in the case
of Sub-Saharan countries, economic growth performance is also observed to be
poor. Left to its own devices, poor economic growth would further weaken the
already weak infrastructure system.
Poor investment and decisions with respect to the choice of infrastructure
projects could have a devastating effect on the economy, environment and the
society, examples can found in water projects in Yemen (Milton, 2001), others
are in shattered road projects. A high cost strategy of growth would consequently
be inappropriate to the social and economic circumstances of poor countries.
There is good reason to believe that investments in pro-poor and affordable
infrastructure projects are most likely to be growth promoting, while
infrastructure projects with a high capital–output ratio are likely to be growth
constraining. Also as stated before by Ofori (1990) and Ganesan (1994), projects
should, for developing countries, be of simple technology, and make use of low
levels of equipment and high levels of labour.
7.1. 6 LAW AND REGULATIONS ENFORCEMENT STRATEGY
Amongst the various strategies and tools designed to play important roles in
achieving sustainable development is establishing legislation and the
152
enforcement of associated laws and regulations. In order for the construction
industry to engage in economically sustainable activities, certain rules have to be
in place. These rules can take the form of contracts, which set the parameters for
transactions.
According to Agenda 21 (paragraph 8.14) many developing countries have been
affected by shortcomings of laws and regulations. Formal channels such as the
courts, tribunals, market and professional bodies that can set the process of self-
regulation in motion should be established to enforce contracts, maintain
discipline, or facilitate contracts. To effectively integrate environment and
development in the policies and practices of the country, it is essential to develop
and implement integrated, enforceable and effective laws and regulations that are
based upon sound social, ecological, economic and scientific principles.
It is equally critical to develop workable programs to review and enforce
compliance with the laws, regulations and standards that are adopted. Technical
support will be needed for many countries to accomplish these goals. Agenda 21
(paragraph 8.13) states that laws and regulations are among the most important
instruments for transforming environment and development policies into action
and should be suited to country-specific conditions, not only through “command
and control” methods, but also as a normative framework for economic planning
and market instruments.
Although the construction industry can adapt itself in numerous ways to reduce
the environmental and economical impact of construction and make it more
sustainable, in most countries it operates competitively within a frame work of
legislative and fiscal controls set by governments (Agenda 21, 1992).
Strategies are required for the establishment of:
• regulations and controls in relation to sustainable development. In
most countries, for example, mineral extraction permits are required
for starting and extending quarrying; as are permits for the extraction
153
of resources; and many aspects of the disposal of waste, for instance
by landfill, are under the government control;
• effective law covering contract disputes, in construction activities;
• law and legalisation for land and safe investment; and
• people should be protected by law against unfair practices.
7.1. 7 PRICING POLICIES
Pricing policy implies several things. Firstly, it implies some form of control or
regulation of market prices and interference in the free functioning of the market
mechanism. Secondly, it presupposes the existence of certain conditions which
necessitate price regulation; thirdly, it means a set of measures directly
influencing the level of certain prices with a view to changing those conditions in
order to achieve certain objectives (Saksena, 1986). In the simplest terms, if the
price of an unsustainable service or product is lower than that of a more
sustainable alternative, more sustainable consumer behaviour is discouraged.
Pricing policies can be used to influence the consumer in the choice of materials
and construction activities. The understanding of future trends in construction
prices is likely to influence the construction investment strategy of a variety of
interested parties, ranging from private and public clients to construction
contractors, property speculators, financial institutions, and construction
professionals.
Agenda 21 (paragraph 8.47) states that governments should seek to identify and
consider measures to correct price distortions arising from environmental
programs affecting land, water and energy. Paragraph 2.34 states that it is
necessary to establish, in the light of the country-specific conditions, economic
policy reforms that promote the efficient planning and utilization of resources for
sustainable development through sound economic and social policies, foster
entrepreneurship and the integration and inclusion of social and environmental
costs in resource pricing. Paragraph 2.36 adds that developing countries should
consider strengthening their efforts to implement sound economic policies to
154
maintain the monetary and fiscal discipline required to promote price stability
and external balance and that result in realistic exchange rates. Paragraph 4.24
states that without the stimulus of prices and market signals to make clear to
producers and consumers the environmental costs of the consumption of energy,
materials and natural resources and the generation of wastes, significant changes
in consumption and production patterns will be unlikely to occur in the near
future.
According to Agenda 21 (paragraph 8.14) laws and regulations are important but
cannot alone be expected to deal with the problems of environment and
development. Prices, markets and governmental fiscal and economic policies
should also play a complementary role in shaping attitudes and behaviour
towards the environment, to move more fully towards integration of social and
environmental costs into economic activities, so that prices will appropriately
reflect the relative scarcity and total value of resources and contribute towards
the prevention of environmental degradation. Agenda 21 for Sustainable
Construction in Developing Countries (CIB/UNEP-IETC, 2002) stated that:
Economic sustainability within construction requires that social and
environmental costs should be internalised and reflect the final product prices.
One disadvantage of the pricing policy is that it may result in an allocation of
resources in a way that may not be in the interest of the consumers. If the
consumers have to pay a high price for a product, they will often compromise on
the quality.
7.1. 8 IMPROVE ADMINISTRATION AND INSTITUTIONAL
EFFECTIVENESS AND REDUCE ALL FORMS OF
BUREAUCRATIC PROCEDURES.
A marked distinction exists between developed countries and their developing
counterparts in their ability to deal with environmental problems (Ebohon &
155
Rwelamila, 2001) and there is a huge gap between developed countries and
developing countries with regards to technical, financial and institutional
capacities, which are crucial to the successful rearrangement of economic and
social relations as applied to production and consumption. The main difference is
in institutional capacity, which underpins effective policy formulation and
implementation.
There is a need for creating and enabling an economic environment through
policy changes and more effective policy implementation. To realize this goal,
there is a strong need for the public administration in developing countries to be
efficient and cost-effective (Saxena, 1996). Unfortunately public administration
in developing countries is, in general, highly bureaucratized and extremely
centralized, based on an authoritarian legal system (Avegerou, 1990). There is
also an absence of effective institutions to facilitate policies and support their
implementation.
As recommended by Turin (1973 & 1978) all inappropriate statutory regulations
should be abandoned in developing countries. Agenda 21 (paragraph 2.37) also
indicates that wherever appropriate, and taking into account national strategies
and objectives, countries should remove the barriers to progress caused by
bureaucratic inefficiencies, administrative strains, unnecessary controls and the
neglect of market conditions. In addition Chapter 8 of Agenda 21 highlights a
variety of ways in which institutional frameworks can obstruct government
decision-making for sustainable development. Institutional arrangements at all
levels of government can create impediments to sustainable development policy-
making, planning and management.
In many parts of the world, especially in non-OECD countries, red tape ranks
very high as an obstacle to doing business (De Soto, 1989; Brunetti et al., 1997),
often being more important than financial constraints (Johnson et al., 2000).
Also, excessive regulation breeds corruption17 (Bardhan, 1997) which in turn is
17 The widely accepted definition of corruption is that used by the World Bank (Tanzi, 1998): Corruption is the abuse of public power for private benefit.
156
very costly to growth and development (Mauro, 1995). In fact as Tanzi (1998)
noted that when rules can be used to extract bribes, more rules will be created.
Public administration is resistant to change, and is highly bureaucratic in terms of
an over commitment to regulation and rules. Also public administration
institutions are typically paid out of an allocated budget, which is not based on
results and performance; thus, there is apparently no pressure on them to perform
better.
The chairman of Transparency International, Peter Eigen, at the launch of TI
Corruption Perceptions Index (2004) stated that “Corruption in public projects is
a daunting obstacle to sustainable development, and results in a major loss of
public funds”.
According to annual surveys by the Berlin-based organization Transparency
International (TI) in its Corruption Perceptions Index (CPI) 18 gave Yemen a
score of 2.619 on its 2003 Corruption Perception Index and was ranked 88th from
133 countries, and in 2004 was ranked as 112th from 146 countries. Nine out of
ten developing countries urgently need practical support to fight corruption,
according to the new index.
7 . 2. SUMMARY
For the construction industry to achieve a level of economic sustainability there
are a wide variety of policies and strategies to be considered. These possible
policies and strategies were outlined in this chapter. This set of policies was
selected to be in line with local conditions and have been adapted predominantly
from international agendas and such as:
18 The index defines corruption as the abuse of public office for private gain, and measures the degree to which corruption is perceived to exist among a country's public officials and politicians. 19 (1 indicates total corruption, 10 indicates no corruption)
157
• Agenda 21 for Sustainable Development, UNCED (1992)
• Agenda 21 On Sustainable Construction, CIB (1999)
• Agenda 21 for sustainable construction in developing countries
CIB/UNEP-IETC (2002)
In basic terms, policies, which have suitable criteria that in the short to medium
term can stimulate economic activities or remove obstacles to move forward to a
more sustained economy based on sustainable development and in compliance
with the Yemen situation, were carefully chosen and discussed according to
international and developing countries experience.
158
CHAPTER 8
A DELPHI METHODOLGY FOR ASSESSING POLICY
AND STRATEGY RANKINGS
This thesis examines how the construction industry of the developing economy
of Yemen can initiate economic sustainability. This is done, by proposing and
ranking the most needed policies and strategies to develop a suitable framework
able to sustain the construction economy in Yemen. Within the course of this
investigation it was intended to bring awareness to professional groups and
experts about sustainable development.
Further to the methodology development literature that was carried out in
Chapter 5, this chapter reassesses the consensus-forming Delphi method. While
the previous chapter reviewed the set of policies, this chapter utilises the Delphi
method to rank these policies. For the construction industry to achieve a level of
economic sustainability there is a wide variety of policies and strategies. These
possible strategies and policies were outlined in Chapter 7. In basic terms,
policies, which have suitable criteria that can stimulate economic activities or
remove obstacles to move forward to a more sustained economy based on
sustainable development and in compliance with the Yemen situation, were
carefully chosen and ranked by Yemeni experts in this chapter.
159
8.1. RANKING OF POLICIES USING CONSENSUS TECHNIQUES
The methodology in this chapter ranks policies and strategies using consensus-
forming techniques. It proposes an expert group be formed to participate in a
Delphi analysis approach. The Delphi technique is deemed most appropriate for
reasons to be explored in the next section. The goal of this technique is to rank
the construction economic stimulant policies and strategies selected in the
previous chapter.
The strategies and policies selected for evaluation were:
• labour-intensive construction policies;
• energy and cost efficient policies in design and construction;
• credit and funding policies on selected projects;
• local material protection policy and imports control;
• strategies for sustaining affordable infrastructure projects, human
settlements and socio-economic development;
• strengthening the law and regulations to control economic activities
and development;
• pricing policies and market control; and
• improving administration and institutional effectiveness and reduce
all forms of bureaucratic procedures.
8.2. DELPHI METHODOLOGY
8 .2. 1 BACKGROUND TO DELPHI
It was in 1950 that Helmer and Dalkey at the RAND Corporation; an American
non-profit institution that helps improve policy and decision making through
research and analysis, really advanced the technique to increase the accuracy of
forecasts. From this beginning, the Delphi technique found its way into private
corporations, research organisations, government, education and academia. With
160
such proliferation of use, the technique also came to be modified to the point
where we now have a family of `Delphi-inspired techniques' in a broad range of
applications (Martino, 1983; Van Dijk, 1990). These are:
• The Conventional Delphi;
• The Policy Delphi; and
• The Decision Delphi (Woudenberg, 1991; Van Dijk, 1990).
The Conventional Delphi has two main functions: forecasting and estimating
unknown parameters. It is used to determine consensus on forecasting dates and
developments in many areas - but particularly in the area of long term change in
the fields of science and technology. By estimating unknown parameters,
respondents make their own estimates regarding the expected levels of an
activity relative to present levels. The Policy Delphi, on the other hand, does not
aim for consensus but seeks to generate the strongest possible opposing views on
the resolution of an issue and to table as many opinions as possible. The
objective is for it to act as a forum for ideas and to expose the range of positions
advocated. And finally the Decision Delphi is utilized to reach decisions amongst
a diverse group of people with different investments in the solution.
The Delphi was designed to optimize the use of group opinion whilst minimizing
the adverse qualities of interacting groups. As such, it has four basic features:
structured questioning, iteration, controlled feedback and anonymity of
responses. Structured questioning is achieved through the use of questionnaires.
This keeps a clear focus on the study and enables the moderator/s to control the
process and channel it into a compact product. Iteration is the process by which
the questionnaire is presented over a number of rounds to enable participants to
reconsider their responses. Controlled feedback is achieved by feeding back to
the panel members the responses of the whole group as well as their own
response for their reconsideration. This means that all the responses of the panel
are taken into account. Anonymity is achieved through the questionnaires, ideally
giving group members the freedom to express their opinions without feeling
pressured by the wider group.
161
Many different types of Delphi survey techniques have been developed, though
they all have several distinguishing features:
• they elicit the views of panels of experts;
• they employ an iterative process of summarizing, averaging and recycling
panel members’ views to encourage convergence on a consensus view;
• participants are given the opportunity to revise earlier answers in the light
of the general opinions expressed by the group as a whole;
• information is collected by questionnaire and does not involve interviews
or discussion; and
• members of the panel are guaranteed anonymity.
Saaty & Boone (1990) argue that there are four justifiable ways of forecasting
the future. One is by consensus, the second is by extrapolating on trends, the
third is by historical analysis and analogy and the fourth is the systematic
generation of alternative paths to the future. Delphi is considered the most
prominent of the consensus methodologies (Jones, 1980). Quantitative
forecasting can be used when there is information about the past, when this
information can be expressed as data and when there is an assumption that the
future will be a continuation of the past and the present. If you don't believe this
is how change occurs and data is not available you need to turn to qualitative
methods. Delphi is one of the best known qualitative methods and is one of the
four opinion capturing techniques used by planners and futurists (Nelms & Porter
1985).
Linstone & Turoff (1975) have identified a Delphi survey as “a method of
structuring a group communication, so that the process is effective in allowing a
group of individuals, as a whole to deal with a complex problem”. They see an
important role for the Delphi survey where:
• a problem does not permit the application of precise analytical techniques
but can “benefit from subjective judgments on a collective basis”;
162
• the relevant specialists are in different fields and occupations and not in
direct communication;
• the number of specialists is too large to “effectively interact in a face to
face exchange” and too little time and funds are available to organize
group meetings;
• more individuals are needed than can effectively interact in a face to face
meetings;
• disagreements among individuals are so severe or politically unpalatable
that the communication process must be refereed and/or anonymity
assured; and
• the diversity of the participants must be preserved to assure validity of the
results i.e. avoidance of domination by quantity or by strength of
personality.
The Delphi technique, due to its flexibility, is best suited to the exploration of
issues involving a mixture of scientific evidence and social values (Webler et al,
1991). Mohapatra et al (1984) suggest that a Delphi study is usually directed to
four broad categories of issues. These are:
• normative issues such as ‘goal setting’;
• narrative issues such as ‘problem statements’;
• predictive issues such as forecasting occurrence of new events and
forecasting point values and trends of key parameters; and
• suggestive issues such as developing causal models and formulating new
policies.
The Delphi survey method was selected for this research for the purpose of
validating a list of policies for attaining economic sustainability for the
construction industry in Yemen.
8 .2. 2 SUGGESTIONS FOR IMPROVEMENT
The following suggestions are to improve the execution of the Delphi study:
163
• The membership of the panel is perhaps the most critical point in using
the Delphi. The effective selection of the panel not only maximizes the
quality of responses, but also gives the results of the study a credibility
with the wider audience (Bjil, 1992).
• There are times when alternative interviewing techniques should be used
in a study. For example, having a face to face meeting may provide a
stimulus for discussion that could be beneficial to the study. In addition,
individual interviews have been cited as the most effective way of
reflecting the participant’s opinion.
• The questionnaire used in the study should minimize ambiguities and the
moderator, when editing the panellists’ responses for reiteration, must try
to keep the intent of the respondents’ answers intact and consistent
between rounds. It is useful to keep track of how sub-groups respond to
the questions so as to analyze whether there is a polarization of results
based on the respondent’s background.
• Close attention needs to be paid to the structure and content of the first
round of questions, as this will impact on the rest of the study. Ideally, the
questionnaire should be pre-tested prior to distribution to the participants
to ensure that all the questions are clearly understood (Thompson, 1973).
• Similarly, because Delphi studies often have participants from a wide
variety of backgrounds, it is important that the questionnaires are
expressed in a way that is widely understood (Bjil, 1992).
• Statements used in the questionnaires shouldn't be more than 20-25
words. Too many or too few words reduces consensus and weakens the
quality of information obtained (Linstone & Turoff, 1975).
164
• It seems important that respondents be given a brief account of the origin
of the research topic that the Delphi study is focusing on and the
investigation procedures to be used. In this way, participants will be
better informed about the rationale for the study and the questions.
• And finally, when aggregating the answers from the questionnaires for a
median score, it is important that the study strives for stability rather than
consensus. In this way, divergent opinions can be acknowledged and
included in the findings.
8.3. THE SELECTION OF EXPERTS
The purpose of this section is to clearly define the criteria to select experts for
data collection and to describe the group of participants for the two-round Delphi
survey proposed for this research project.
Experts are qualified through their knowledge, skill, experience, training or
education; therefore, criteria to select the experts for this research study
considered the following:
• experience and contribution within the local industry construction
activities and economics in the Yemen;
• knowledge of the local capabilities;
• some knowledge of sustainable development; and
• experience of construction or economic activities.
Initially, the two-round Delphi survey was conducted targeting a group of
25 experts, who were selected (as described in Chapter 5) to represent different
viewpoints between the experts and authorities responsible for policy-making in
Yemen. The group of experts composed professional engineers, economists, and
academics (as listed in Chapter 5). The specific question posed to this panel:
165
How does the construction industry in Yemen achieve economic
sustainability?
8.4. THE DELPHI PROCEDURE
Before the respondents answered the Delphi questionnaire, they were presented
with a letter of instruction (refer Appendices D-1 and D-3). This letter contained
a description of the main objective of the research, the methodology used and the
research question to be answered.
The Delphi survey was prepared using two rounds with questionnaires. In the
questionnaire for the first round, the respondents were asked to consider eight
polices and strategies to attain economic sustainability for the local industry. An
explanatory note was appended with each policy to give a quick definition and
reason for policy selection.
Based on their experience they were asked to rank these policies in terms of
urgency and importance of implication in the process towards sustainable
economic development. Participants were permitted to add any policy to the list
they felt should be included.
The questionnaires were initially in English. Definitions were attached and any
ambiguities of the ranking were explained through direct personal contacts with
the main local representatives or by using other available direct means of
communication such as emails and telephone.
In response to the importance of the policy, respondents were asked to think of
the local capabilities, potential and the associated barriers and deficits.
Respondent were then asked to answer:
What is the most- needed policy for achieving sustainable economic
development in the construction industry?
166
The respondents were asked to rank each policy based on numerical order from
1 to 8 – 1 indicating most important or considered most needed and necessary
policy and 8 indicating the least needed and or less critical policy, according to
its importance in the short to medium term future for economic sustainability.
Additional information was considered to identify each respondent with respect
to position or title, place of work, years of experience and work achievement.
For round one, the questionnaire was sent via emails to the correspondents’
addresses at same time on the same day. The questionnaire was also designed to
allow additional suggestions or policies. These additional policies (if any) were
not to be scored until round two. Due to the slow response of respondents,
telephone calls and several email reminders were sent.
When the respondents returned the questionnaire from the first round, the results
were analysed, tabulated and returned to the respondents for their further
consideration, along with the questionnaire of the second round (Appendix D-4).
Twenty one experts responded to the first round representing experts from:
• Ministry of Planning and International Cooperation;
• Sana’a University, Faculty of Engineering;
• Sana’a University, Faculty of Commerce and Economics;
• The University of Science and Technology;
• UNDP;
• local consulting firms;
• construction and contracting firms; and
• The Ministry of Civil Work and Urban Development
After completing the first round when a reasonable number of participants has
responded, the group received the questionnaire adjusted for round two. In the
second round questionnaire, each participant was asked to review his/her original
167
response of the importance of the economic development policies, and to
compare them with the entire group before they made their final decision.
The purpose of the second round was to create a consensus among the experts
and confirm the key issues identified in the first round. In addition, the second
round increased the opportunity to get a deeper perspective on the evaluation
process. The group members were asked, if they wished to change or confirm
their responses in view of the new information. After the respondents had
completed these questionnaires, the material was collected and processed.
Only ten experts were finally used. The elimination of experts was based on two
criteria, the first was that most experts did not respond to the second round and
the second reason was based on their persistence in giving policies equal ranking,
as they felt that policies were equally important and could not be favoured one
against the other.
The ten experts used were as follows:
• construction and contracting firms (2);
• local consulting firm (1);
• The Ministry of Civil Work and Urban Development (1);
• Ministry of Planning and International Cooperation (1);
• Sana’a University, Faculty of Engineering (3);
• The University of Science and Technology (1); and
• Sana’a University, Faculty of Commerce and Economics (1).
After processing the responses from round two, it was determined that additional
rounds of questioning would not produce significant changes of opinion and
therefore additional questionnaires were deemed unnecessary. The rankings for
each policy response were tabulated and were appended to the survey’s
participating experts with the second round (Appendix D-4).
168
8.5. TABULATION OF THE FIRST ROUND RESPONSES
The first round responses of the Delphi survey were tabulated and analysed using
a distribution ranking table to annotate the average ranking, median ranking and
the order of importance of each policy as indicated in Table 8.1. Experts were
denoted by alphabetical letters.
Table 8.1 Delphi First round
Rankings by participants
A B C D E F G H I J A
vera
ge ra
nkin
g
Med
ian
rank
ing
Impo
rtanc
e or
der
I Labour-intensive construction policies. 6 7 5 2 5 3 6 6 6 5 5.1 5.5 6
II Energy-efficient policies in design and construction. 2 3 3 7 3 7 7 5 5 4 4.6 4.5 4
III Credit and funding policies on selected projects 7 8 4 8 7 4 4 7 8 7 6.4 7.0 8
IV Local materials industry protection policy. 8 6 7 4 4 8 1 4 3 8 5.3 5.0 5
V Strategies for sustaining affordable infrastructure projects. 3 4 2 3 8 5 2 3 1 2 3.3 3.0 2
VI Strengthening the law and regulations in construction and land affairs.
5 5 1 6 2 1 5 2 7 1 3.5 3.5 3
VII Pricing policies 4 2 8 1 6 6 8 8 4 6 5.3 6.0 7
VIII
Improve institutional and administration effectiveness and reduce all forms of bureaucratic procedures.
1 1 6 5 1 2 3 1 2 3 2.5 2.0 1
169
8.6. TABULATION AND RANKING OF RESPONSES FROM ROUND
TWO
The results of the responses of the policy ranking and importance from the two
rounds of the Delphi surveys were tabulated, averaged and used to validate each
policy ranking of importance. The final ranking for the most needed policies for
the economic sustainability in Yemen are represented in Table 8.2.
Table 8.2 Delphi Second Round
Rankings by participants
A B C D E F G H I J A
vera
ge
rank
ing
Med
ian
rank
ing
Impo
rtanc
e or
der
I Labour-intensive construction policies. 6 6 5 2 5 3 6 8 6 5 5.2 5.5 6
II Energy-efficient policies in design and construction. 5 7 3 5 6 7 7 4 3 4 5.1 5 4
III Credit and funding policies on selected projects 8 8 4 8 7 4 5 5 7 8 6.4 7 8
IV Local materials industry protection policy. 1 4 7 7 4 8 1 6 5 7 5.0 5.5 5
V Strategies for sustaining affordable infrastructure projects.
3 5 2 4 3 5 2 3 2 3 3.2 3 3
VI Strengthening law and regulations in construction and land affairs.
7 3 1 3 1 1 4 1 4 1 2.6 2 2
VII Pricing policies 2 2 8 6 8 6 8 7 8 6 6.1 6.5 7
VIII
Improve institutional and administration effectiveness and reduce all forms of bureaucratic procedures.
4 1 6 1 2 2 3 2 1 2 2.4 2 1
170
8.7. ASSUMPTIONS FOR THE POLICY RANKING
In interpreting the results of this research one should be aware of its assumptions
and limitations. One assumption regarding the objective function for the
participants of the Delphi survey was that the participants had to judge the
expected ranking for a sustainable future. One of the shortcomings of the Delphi
survey method is that it can exaggerate the concept of expertise and over-value
the opinions of the panel; therefore, the final ranking developed in this research
study is applicable in the context of the construction industry in Yemen, the place
where the experts were selected (similar least developed countries with similar
circumstances can benefit from the outcome).
In addition, the Delphi survey method offers little insight in the reasoning
underlying the participants’ responses. To reduce the negative impact of this
condition, some participants had the opportunity to discuss and comment on the
policies and their ranking which has played a major part in performing the final
discussion presented in the next chapter.
Although, some participants were able to ask questions about the definitions and
of the policies criteria, the time frame and distance constrains did not allow the
opportunity to verify if each expert understood the description of the economic
sustainability criteria; therefore, it was assumed that all participants of the Delphi
survey had a good understanding of all the criteria in the questionnaire. The
anonymity of the participants relieves them of accountability and can lead to
fearless and honest responses.
171
CHAPTER 9
RANKING AND EVALUATION OF SUSTAINABLE
POLICIES AND STRATEGIES
The Yemen construction industry should implement appropriate policies for the
purpose of attaining efficiency and economic sustainability. In this chapter,
policies and their sequence of importance are discussed and evaluated according
to their ranking forecast by the experts, in order to attain economic sustainability.
The selection of policies and strategies was based on local conditions and the
existing development barriers in the local industry by means of survey and
available reports. The eight selected policies outlined in Chapter 7 were ranked
by a panel of Yemeni experts in Chapter 8.
The criteria for ranking the strategies and policies is based on the priorities
regarding the most desired policies for initiating the development process
towards economically sustainable development in the construction industry.
The methodology for ranking the policies is discussed, in terms of each specific
policy, its possible implementation in Yemen, and the rationale for some of the
preferences made by the panel of experts in their rankings.
172
9. 1 METHODOLOGY AND RELATIVE RANKING
The questionnaire (refer Appendix D-2) was developed for completion by
experts from various sectors of the Yemeni government, private sector and
academia. The Delphi technique was used to elicit ranking by the panel members
of the variety of policies defined in order to promote the indigenous construction
industry. The basic question posed to the panel was to review the eight policies
listed and to rank them in order of importance and priority. Although all policies
can be important, the main point is to promote awareness of most needed policies
in the development process.
The first round questionnaire was delivered directly by email and indirectly via
local representatives. During the initial round, panel members were allowed to
add any other suggestions or policies which they believed would promote an
efficient and economically sustainable industry. The panel members were
allowed to ask any questions regarding any ambiguities of the rankings or
policies and definitions.
The definitions of sustainable development, sustainable construction and
economic sustainability were included in both rounds to remind the participants
of the sustainable development criteria that this research is based on.
After the initial rankings were obtained, the rankings of all experts were
tabulated and this information was returned directly to the panel members as the
second round (Appendix D-4), with instructions to review the rankings of the
entire panel and reconsider whether they would make any changes in their
ranking accordingly. Some panel members did make changes to their ranking
from the first round questionnaire. As the average and median ranking generally
remained the same, we can assume that a reasonable level of consensus has been
reached, therefore it was decided that a two round Delphi process is satisfactory.
173
All the responses for the second round are provided in Table 9.1 which
summarises the policy rankings according to each of the panel members.
Table 9.1 Final Round Results
Rankings by participants
Policy
Priv
ate
sect
or
Gov
ernm
ent
Aca
dem
ics
A B C D E F G H I J Ave
rage
rank
ing
Med
ian
rank
ing
Ran
king
ord
er
Labour-intensive construction policies. 6 6 5 2 5 3 6 8 6 5 5.2 5.5 6
Energy-efficient policies in design and construction. 5 7 3 5 6 7 7 4 3 4 5.1 5 4
Credit and funding policies on selected projects. 8 8 4 8 7 4 5 5 7 8 6.4 7 8
Local materials protection policy. 1 4 7 7 4 8 1 6 5 7 5.0 5.5 5
Strategies for sustaining the continuity of affordable infrastructure projects. 3 5 2 4 3 5 2 3 2 3 3.2 3 3
Strengthening the law and regulations in construction and land affairs. 7 3 1 3 1 1 4 1 4 1 2.6 2 2
Pricing policies 2 2 8 6 8 6 8 7 8 6 6.1 6.5 7
improve administration and institutional effectiveness, and reduce all forms of bureaucratic procedures
4 1 6 1 2 2 3 2 1 2 2.4 2 1
The 10 experts are described as follows:
• private construction and contracting firms (A&B);
• private local consulting firm also representing the Ministry of Finance (C);
• The Ministry of Civil Work and Urban Development (D);
174
• Ministry of Planning and International Cooperation (E);
• Sana’a University, Faculty of Engineering (F,G,H);
• The University of Science and Technology (I); and
• Sana’a University, Faculty of Commerce and Economics (J).
9. 2 DISCUSSION OF THE RANKINGS
This section presents an evaluation of the ranked policies and a discussion of
these policies in terms of their suitability to stimulate the indigenous construction
industry.
9. 2. 1 LABOUR-INTENSIVE CONSTRUCTION POLICIES
The ranking by the panel members on encouraging and promoting labour
intensive policies in construction activities, partly by mandating minimum crew
size both in public and private construction projects, affordable infrastructures,
and human settlements, were to some extent mixed and ranked low20 with a
median ranking of 5.5. One government member ranked it 2nd. Another
government member (E) indicated that this was always influenced by the
procurement policies of the lending organisations.
Most members representing the private sector and academics gave a low ranking
for this policy. This was to be expected due to the concerns the private sector has
on the issues of productivity in the project, and excessive costs and delays
associated with this approach. Above all, the major problem in increasing the
number of labour-intensive projects is the high requirement for site
management; moreover, administration costs of labour-intensive projects can
also be high. Another argument is that a country needs an efficient construction
industry and that means aiming for low costs and high productivity. The labour
20 Ranking: 1-2 high, 3-4 good, 5-6 is low and 7-8 is very low
175
intensive program; if it is to be successful in Yemen, must first solve the more
basic technical, financial and economic problems, and then demonstrate how to
effectively use labour.
There are however some negative aspects to this policy raised on by the
participants:
• generating arbitrary conditions on a construction project input will
undoubtedly raise the cost of doing the project;
• requiring higher labour content acts as a discouragement to local firms to
invest in productivity-enhancing capital, which ultimately allows it to
compete with foreign firms; and
• the high content of labour requires a high measure of management and
supervision which is difficult due to scarce skilled technicians, foremen and
site engineers; difficulties also arise on site, in the contractor’s office and in
administration at the funding organisation. In many developing countries
including Yemen, there is a shortage of managers and supervisors which
makes it more attractive to use plant and equipment to replace men.
Despite the low ranking this policy gained, the substitution of abundant labour
for the scarce capital can be a more feasible solution, and might generate more
employment and output than would otherwise be possible. An alternative
suggestion is labour-based technologies.
While Agenda 21 and the Poverty Reduction Strategy Paper (PRSP) support the
policy, in terms of promoting employment and skills in the indigenous industry
and decreasing poverty, there will always be a lack of interest in this policy from
the private sector and international organizations such as the World Bank, due to
problems with low productivity, management difficulties, delays and excessive
costs associated with labour-intensive methods.
176
9. 2. 2 ENERGY-EFFICIENT POLICIES IN DESIGN AND
CONSTRUCTION.
The ranking for this strategy was low. Some experts stated that the community
is not ready, unwilling or can’t afford the hazard to change, in view of the fact
that the market is also not ready to adopt new technologies, particularly in the
absence of research on best traditional design and construction models, and
absence of guidelines on standard methods and materials.
Furthermore, the construction sector is dominated by local companies and
contractors who are not interested in technology changes involving risks and
extra costs, and most of all they do not have the experience, knowledge and
capital to implement such policies and strategies.
According to Agenda 21 for Sustainable Construction (2002), the construction
industry is traditionally and economically very difficult to change, especially
when it comes to construction methods and building materials used. Companies
usually follow the consumption patterns of clients who normally worship the
modernity of the existing model found in the developed countries.
Some experts such as the private local consultant and the expert representing the
University of Science and Technology supported the policy and indicated that
this policy must be implemented and encouraged for the reason that; with some
efforts, the policy implementation is approachable and manageable, especially
when adapting traditional methods or materials.
Donor and government financed projects can set examples for such sustainable
designs and construction models to encourage their implementation.
177
9. 2. 3 CREDIT AND FUNDING POLICIES ON SELECTED
PROJECTS
A policy of credit easing was ranked down in both rounds by most members,
particularly members representing the private sector, the government members,
one academic and the rest of the academics rated the policy reasonably low. The
generally good ranking given by the local consultant (C) was expected given the
Central Bank’s commitment to currency and investment stability.
Most of the panel’s opposition to credit easing is derived from the lack of trust
in the existing weak law and banking institutions and the lack of financial
management and honesty in using funds in an appropriate way or on
inappropriate projects. Despite the need for a financing system to facilitate
credit, experts felt that, with existing lack of law and regulations and existence
of corruption and bureaucracy, a high percentage of the funds will actually be
wasted in all phases of the project. Likewise, the current banking system suffers
in regards to repayments of loans from the borrowers.
The case made here, is that credit and funding institutes should act as a key
promoter to sustainable activities, by only funding efficient and sustainable
construction and projects based on local inputs and methods; in reality this can
be a complicated and impractical task. The selection of sustainable projects will
be technically difficult to justify; moreover, financial institutions rarely consult
professionals and engineers on a permanent basis.
Also it was indicated by some experts that Yemen has little choice in adopting a
different credit and funding policy given that international funding organisations
are the main policy enforcers. In conclusion to discussions with some experts it
was noted that the policy of credit easing has some potential drawbacks:
• if the banking and funding systems do not create safeguards, easier
credit can lead to construction overexpansion and instability;
178
• the developing country’s policy toward credit easing may undermine
international financial confidence and result in organizations such as
the International Monetary Fund demanding tighter controls over
lending practices;
• in the absence of law and the existence of corruption, funding will be
misused; and
• a danger of easy monetary policy is that entrepreneurs may be
tempted by easy credit to start up businesses which are viable only
with very low interest rates, but are not sufficiently profitable to pay
the normal interest rates which are likely to be restored when the
economy recovers.
9. 2. 4 LOCAL MATERIALS PROTECTION POLICY.
This policy has received low rankings from most members, the exception was an
inclination to market and industry protection from the private construction-
contracting firm and one expert member representing the Faculty of
Engineering.
This policy has generated divergence of opinion from supporters and opposers.
Most members feel that it will be too hard for the local industry in the short and
medium term to make any shift from the current situation of overdependence on
imports. There are also worries that the small investments and research in the
building materials and material alternatives makes it hard to initiate any change.
It seems that for the short and medium periods, the industry will stay in the
situation of overdependence on imports; the rationale here is consequently the
control of imports and encouragement of efficient design and practice.
Nonetheless, to implement such policies, stiff control over quality of materials
and prices for substitute goods, should be imposed to inspire public confidence.
Protection policies and fiscal policies would also lead to an increase in
smuggling of construction materials and black-market activities.
179
There are already indications from the high material costs that there is some
market failure. The policy for market protection was not ranked the most
popular in the Yemen case.
9. 2. 5 STRATEGIES FOR SUSTAINING THE CONTINUITY OF
AFFORDABLE INFRASTRUCTURE PROJECTS.
It was shown previously that the basic nature of infrastructure systems in Yemen
has been a major factor militating against prospects for sustainable economic
development.
The persistence of poor economic growth in the region over the last four decades
has in turn limited the scope for affordable infrastructure development. The
policy for the supply of affordable infrastructure was ranked relatively good by
most participants and was ranked 3rd with a median score of 3.0 out of 8 in the
importance scale.
This policy has shortcomings and weaknesses; like most other developing
countries, most of the infrastructure is in financial difficulties at various times
mainly because their operation is inefficient as a result of being largely based on
non-commercial principles (World Bank, 1994).
The financing of infrastructure investments in Yemen has almost invariably
depended upon the provision of public funds and foreign aid. The government
controls almost all the infrastructure work. The role of private finance, in
general, and Foreign Direct Investment (FDI), in particular, has been negligible;
and prospects for these to replace government funding and foreign aid as a
strategy for financing infrastructure development do not appear to be promising,
as most private investors do not consider Yemen attractive for investment, partly
for reasons of political instability, and because of the region’s low average
income and the small size of markets for infrastructure services.
180
9. 2. 6 STRENGTHENING THE LAW AND REGULATIONS IN
CONSTRUCTION AND LAND AFFAIRS.
Most members of the panel gave a high ranking and supported policies for
reinforcing the law and regulations as a key starting point, with the exception of
the member representing a private contracting firm who gave a low ranking. The
low ranking from the private construction firm is because major private firms are
always owned by influential people, and law is no obstacle to their activities in
the case of legal disputes where they can deal with land and contractual
problems without referring to the legal system.
All experts felt that in order for the construction industry to change its
technology, procedures or investment programmes to achieve increased
sustainability, it will need some appropriate laws and regulations to control the
process. Some pressure on the industry will result when the clients (government
and international organizations) decide that they will require their designers to
act in a more sustainable manner. At the same time designers and builders would
like to have appropriate and enforced regulations to help them conduct their
work in a sustainable manner.
The World Bank (2002a) has also indicated that the main constraint in
construction sector development in Yemen is the law dealing with construction
and land affairs. The absence of any existing regulations and legalisation makes
things harder for all professions and stakeholders and land owners, this will
always lead to informal and unsustainable activities.
The existing multiplicity of agencies working to their own conditions of contract,
and the differing languages in which contracts are written, only adds to the
confusion. Ideas differ on major issues such as the validity of agreements, the
obligations and liability of managements, the obligations and liabilities of two
parties in a contract, the resolution of disputes, penalties and damages and the
adequacies of compensation; thus in order for the construction industry to change
its technology, procedures or investment programmes to achieve increased
181
sustainability, it will need to formulate laws and regulations to control the
process.
Likewise, there are legal concerns about contractors and suppliers using
unsustainable standards, materials or activities; especially where sustainable
activities are considered more expensive or less desirable.
9. 2. 7 PRICING POLICIES
A policy for pricing indigenous construction activities and materials generated a
few divergences of opinions of the policies presented and the final median
ranking was very low. The experts representing the private construction and
contracting firms (A, B) were undeniably in favour of this policy. To control
price in the choice of materials, construction technologies and designs, seems to
have the support of the private sector but not the academic members. The local
consultant (C) has also ranked the policy very low.
The academic members think that supporting such policies by subsidising the
price of some items or activities within a weak economy is bound to fail. The
government's role in controlling prices has become very limited, particularly
since Yemen depends on imports in many sectors. The government will find it
hard to control prices, which are determined according to different factors such
as the exchange rate and international prices.
It was argued that if prices can be used for monitoring and controlling any
sustainable practices, a technically efficient production process, especially in a
perfectly competitive market environment, should guarantee competitive prices
that can be passed to consumers in the form of lower product prices.
182
9. 2. 8 IMPROVE ADMINISTRATION AND INSTITUTIONAL
EFFECTIVENESS AND REDUCE ALL FORMS OF
BUREAUCRATIC PROCEDURES
Policies aimed at reducing bureaucratic procedures and corruption are highly
favoured by most members of the panel with the exception of the local
consulting firm. While eliminating bureaucratic procedure seems hard with
existing deficiencies in other sectors and institutions it is still thought to be one
of the main issues. Institutional development is ranked as the initial most
effective requirement for facilitating progress in the development process.
Certain activities such as reuse and recycling should be given encouragement to
investor users and clients. Bureaucracy will always be an obstacle in
discouraging any intended development. Any difficulty in obtaining permission
for recycled or reused materials will lead contractors to go the easy way of
purchasing raw and newly produced materials even at a high cost.
9. 3 SUMMARY
This chapter discussed the expert’s ranking of the selected eight policies that the
researcher considers essential for initiating the local economic development in
the construction industry towards sustainability. The interpretation and
discussion of the Delphi results according to the Yemeni experts ranking
revealed how proactive policies and measures can facilitate and initiate the
process to economic sustainability of the construction industry in Yemen, if
appropriately implemented. The expert’s opinion indicated that polices targeting
administrative and institutional development, along with appropriate laws and
regulations to control construction activities in a particularly sustainable manner
as most critical key needed for initiating the process.
183
CHAPTER 10
CONCLUSIONS AND RECOMMENDATIONS
The construction industry in Yemen is under pressure to change its approach in
order to meet future demands for sustainable and economical development. This
will necessitate changes and hence the need for the selection and implementation
of appropriate policies and strategies to facilitate sustainability in the
construction economy. Unless these changes are brought about, it would be
difficult to implement sustainable development in Yemen. This is not merely
because of the absence of the necessary government and private institutions to
facilitate the process, but it is also due to the fact that institutional procedures
will not be sufficiently knowledgeable or competent to face new challenges.
In the absence of such crucial and fundamental institutions and procedures, the
chances of using economical and technical measures as incentives to bring about
sustainable construction will also be slim, especially where construction firms
and construction activities are unregistered and operate largely within the
informal and unregulated sector of the economy.
10. 1 CONCLUSIONS
In assessing the efficacy and value of the methodology employed in this thesis, it
should first be emphasised that the objective was to shed light on the issues of
the local construction sector in Yemen and bring awareness of the new era of
184
sustainable development and the process requirements for attaining economic
sustainability in the construction industry. It was not meant to create a precise or
theoretical measure or path as might be derived from a fully specified economic
or physical model.
From the data collected it can be shown that there are macroeconomic problems
in unemployment, inflation, balance of payments disequilibrium, and external
debts, all associated with a shortage of information, weak institutions and a lack
of infrastructure. At present, there are international demands imposed on Yemen
to develop and implement comprehensive reform programs for economic
restructuring and adjustment, but some of the programs are thought to be
incorporating international economic globalization.
The survey on the local industry recognized the barriers and economic
bottlenecks facing the local industry development. The research outlined the
current situation, which needs appropriate institutional and legal reforms,
economical solutions, effective technologies, appropriate type of construction
systems, designs and construction materials or changed practices. Chapter 7 has
justified the policies required to stimulate and sustain economic development of
the construction industry in developing countries, specifically in the case of
Yemen.
It seems necessary to combine the use of administrative measures with
appropriate economic and legal means for enhancing Yemen’s overall capacity to
address issues concerning economic and environmental developments and move
towards sustainable development.
The use of consensus-forming techniques allowed the merging of experts’
opinions to rank the best approaches and process arrangements to achieve an
economically sustainable construction industry. The use of the Delphi technique
allowed a structured policy survey and interaction among a diverse group of
experts. The outcome of the policy ranking showed how these policies could be
implemented in terms of priorities as the experts advocated. The low ranking
185
given by experts to some policies is in fact an indication that these policies are
not applicable or difficult to implement within the existing conditions.
The research also concludes that the attainment of economic sustainability in the
construction industry in Yemen is fixed to fragile and corrupted institutional and
administrative constraints, legal and regulatory practice weaknesses followed by
socio-economic barriers in the form of infrastructure shortages. Despite the low
ranking, some experts indicated that the design policy should be encouraged for
the reason that, the policy implementation is approachable and manageable,
especially when adapting traditional methods or materials.
The construction industry in Yemen is very dependent on the imports of
construction materials as the material industry is not readily available to fulfil the
market demands.
The experts did not vigorously pursue the labour-intensive policy, to promote
local economic sustainability in employment. This is due to productivity, cost
and management problems associated with labour-intensive policy programmes.
Fiscal, monetary and pricing policies to control unsustainable activities or
products have not gained the support of the experts. Finally, despite the need for
a financing system to facilitate credit, experts felt that funding through easy
monetary and credit policies is not appropriate approach because of the existing
lack of laws, regulations and the existence of corruption.
10. 2 RECOMMENDATIONS FOR AN ECONOMICALLY
SUSTAINABALE CONSTRUCTION INDUSTRY IN YEMEN
Some of the traditional policies and recommendations outlined in the existing
literature may have been more appropriate to a pre-sustainable development era.
The era of developing country governments promoting growth by increasing
production and excessive use of natural resources should be clearly reassessed.
186
Future stimulus policies should be more targeted to specific objectives, in this
case the construction industry. Foremost among the recommendations would be
to employ the Delphi technique initially to develop clear objectives.
Based on the study of the Yemen case, the discussion and analysis of the experts’
opinions, the following recommendations can be emphasised for Yemen:
• The obvious need for institutional and administrative development and
human quality obligations within a reformed legal environment is an
appropriate starting approach for Yemen. Institution building and creating
the appropriate level of control over corruption via good legalisation
seems essential to any intended development. The availability of
appropriate and efficient administrative procedures and a reduction in
bureaucracy will facilitate economic activities and development process.
Institutional development should eliminate current local constraint by
facilitating appropriate sustainable practices and raise investors and
participants confidence.
• The enforcement of laws and regulations are an essential factor in
controlling the development process of the construction industry and
associated industries. This is also needed to control illegal and
unsustainable construction and economic activities and provide functional
requirements for sustainable building designs and construction, stability
and risk minimisation in the construction business.
• Sustaining an adequate supply of affordable infrastructure is considered
necessary in the process for achieving efficient and economically
sustainable construction development. The construction industry could
reduce some socio-economic problems through sustainable industrial
strategies such as cheap but effective locally based methods of providing
infrastructure and affordable human settlements.
187
Integrated planning is also essential to increase the distribution of
affordable projects and minimize economical and environmental disasters
associated with major projects as experienced in Yemen. Poor investment
decisions with respect to the choice of infrastructure projects have a
devastating effect on the economy; hence, comprehensive and detailed
investigations for future projects and their impact on the economy and
environment are needed.
• Reducing costs and energy consumption via sustainable designs and
construction will necessitate the community acceptance, changes in
engineering attitude and the education syllabus. Standards and
specification guidelines must be established. Moreover, setting and
implementing construction models and demonstrating sustainable projects
for any government-sponsored projects by international organisations can
effectively give support in this direction.
• The materials industry must develop a more liberal and fair open market;
however, this should be with the state control over selective imported
materials. Import controls and fiscal mechanisms of taxation should be
implemented mainly on imported material that is in direct competition
with the locally manufactured low energy materials. Government also
should establish import systems to increase competitive market prices and
quality control within the local industry.
• Using fiscal and pricing measures as incentives towards sustainable
construction will be inadequate, especially where construction firms are
unregistered and operate largely within the informal and unregulated
sector of the economy.
The market also lacks the information or market control to enforce the
implementation of any pricing policies. Market-oriented policies which
influence the cost of particular forms of construction are of less
significant influence. For more appropriate pricing policies, a socio-
188
economic survey is required, to determine how much the community or
an individual can afford to pay for a service.
10.2.1. PROPOSED GUIDELINES AND SUGGESTIONS TO
FACILITATE ECONOMICALLY SUSTAINABLE
CONSTRUCTION INDUSTRY IN YEMEN
The following short to medium-term guidelines and suggestions are proposed by
the author:
• It is necessary to improve the competence and ability of government
human resources at all levels to play an active role in the sustainable
development. This will mean improving the understanding of strategic
decision-makers, training local government officials and finding the
financial resources to support them. Management development would
perhaps affect the situation more positively than any other
recommendations.
• Construction and economic activity manuals and guidelines should be
established to streamline bureaucratic procedures.
• In the context of the decision-making process, the establishment of
adequate and appropriate information and statistics is considered to be the
basis for sustainable success and development.
• Implement the Government’s clear procurement policies and regulations
to encourage sustainable development. Government-financed projects
should be carefully selected and designed to allow; as much as possible,
for the inclusion of local resources and materials.
• The Yemen construction industry should put more effort into minimizing
the consumption of resources through the execution of high quality
projects, and therefore decisions should be based upon competent and
189
well-organized planning and specialist decisions in avoiding low quality
projects, and minimize the associated maintenance and life cycle costs in
these projects.
• Efforts should be concentrated on the quality production and use of local
low energy materials. The government and the private sector should study
and initiate more research on the use of local materials and the
recommended measures for their development. Since the modern
construction industry will be relying on imported materials for some
considerable time to come, the local industry should adopt practices that
utilize imported materials with low embodied energy and renewable
materials.
• Establishing a standardized market system in order to allow market
mechanisms to play a fundamental role in resource allocation.
• Specifications and regulations of building materials are required. Reuse
of mechanisms should be introduced to modern/traditional Yemeni
architecture and construction.
• Engineers must acquire the skills, knowledge, and information on
sustainable development. The promotion of sustainable development
demands that engineers cultivate an understanding of the economical,
social and environmental issues, risks and impacts on the community. In
addition, academics must provide students with the analytical tools to
assess risks and impacts, to perform life cycle analysis, and to utilize the
ability to solve technical and design problems.
• Protection against unsafe property and real estate activities is required.
190
10. 3 IMPLICATIONS FOR FURTHER RESEARCH
Discussions with experts elicited a variety of views on Yemen’s appropriate
objectives and Delphi technique can be used to investigate further the following
policies and cases:
• investigate the best process for the government to change institutional and
legal systems to enhance sustainable development;
• investigate to wether the government should sustain and support small
business enterprises and local firms for economic development or rather
promote larger local firms;
• determine if affordability will be a major issue in sustainable economic
activities;
• investigate the effect of lean construction methodologies;
• establish methods to effect public perception towards sustainable
development;
• investigate policies aimed at the overall maximization of domestic
employment to reduce poverty;
• examine policies aimed at encouraging foreign and local investors
intervention in infrastructure projects;
• discuss future policies and strategies on urbanisation; and
• Consider policies aimed at integrating and improving the informal
sector.
The fact is that Yemen will not be able to integrate the newer sustainable
technologies into low-income communities for a long time; however, Yemen
has a long tradition of construction that is more sustainable and better suited
to local conditions than that introduced by imported technologies. Therefore,
another key area for research is to identify these construction practices and
materials and develop them further to provide an improved standard of living,
while providing low-income communities with the opportunity to create
livable and inhabitable settlements while sustaining their cultural heritage.
191
REFERENCES
Adebayo A. (2001), Sustainable Construction In Africa. African Position Paper,
Agenda 21 for Sustainable Construction in Developing Countries, Accessed
online in Jun. 2002
http://www.sustainablesettlement.co.za/docs/a21_adebayo.pdf.
Alam M.S. (1990), Some economic costs of corruption in less developed
countries , The Journal of Development Studies, vol.27 pp89-97
Al-Kamali M. (2001), Unplanned Imports: A Real Threat on National Wealth,
Yemen Times, February 5th through February 11th 2001, Vol XI . Accessed
online in Sep. 2002 http://www.yementimes.com/01/iss06/b&e.htm
Al-Momani A. (1995), Construction practices: the gap between intent and
performance , Journal of Building Research and Information, vol. 23, no.2, pp.
87- 91.
Alwi, S.; Hampson, K. and Mohamed, S. (2001), Waste in the Indonesian
construction projects, The 1st International Conference of CIB W107 Creating a
Sustainable Construction Industry in Developing Countries,11-13 November
2002, South Africa
Al-Momani A. H. (1996), Construction cost prediction for public school
buildings in Jordan, Construction Management and Economics, vol.14, no. 4, pp.
311- 317
192
Amer A. A. (1998), The directions of economic reforms in Yemen 1990-1996.
A paper submitted in the "Second Yemeni Economic Conference " held in Yemen
during the period 18-20 April, 1998. Published in the Althowra
Newspaper Issue No. 12235 date. 12/5/98. Accessed online in Mar. 2002
http://www.yemeninfo.gov.ye/english/economy/directions.htm
Andrews J., Hatchett, M., Hillebrandt, P.M., Jaafar, A.J., Kaplinsky, S. and
Oorthuys, H. (1972), Construction in Overseas Development: A framework for
Research and Action, University College London Environmental Research
Group, London.
Avegerou C. (1990), Computer-based information systems and modernization of
public administration in developing countries. In Bhatnagar S. C. & Bjørn
Andersen N (eds), Information Technology in Developing Countries, Elsevier,
Oxford, pp. 243-250) Information Systems for Development, Amsterdam, North-
Holland, pp243-250 (1990) ISBN: 0 444 88416 5
Banuri T. (1999), Sustainable Development and Climate Change, Policy
Matters, No.4, Newsletter of the IUCN Commission on Environmental,
Economic and Social Policy (CEESP), CEESP Secretariat, IIED, London
Accessed online in Nov. 2003
http://www.iucn.org/themes/ceesp/Publications/newsletter/policy4.pdf
Bardhan, P. (1997), Corruption and development: a review of issues, Journal of
Economic Literature, vol. 35 (3), pp. 1320–1347
Beardsley T. (1995), Surprise! Promises of the Earth Summit are still unmet,
Scientific American, Jun 1995, Vol. 272 Issue 6, pp. 36
Bennett R. (1991), How is management research carried out? , The Management
Research Handbook. Smith N.C. and Danity P. (eds), Routledge, London pp.
85-103
193
Bennett F.L. (1996), The Management of Engineering, John Willey & Sons,
New York, NY
Bjil R. (1992), Delphi in a future scenario study on mental health and mental
health care, Futures, vol. 24, no. 3, pp. 232-250
Bon R. & Hutchinson K. (2000), Sustainable construction: some economic
challenges , Building Research and Information Vol. 28, No. 5/6, pp.310-314
Bon R. & Crosthwaite D. (2000), The Future of International Construction ,
Thomas Telford, London, ISBN 0-7277-2749-4, p 144
Bourdeau L., Huovila P., Lanting R., & Gilham A. (1998), Sustainable
development and the future of construction. A comparison of visions from
various countries, Future Studies in Construction, CIB W82 report, Publication
225, ISBN 90-6363-011-5 Accessed online in May. 2002
http://bativille.cstb.fr/CIB_Reports_pdf/Synthesis.pdf
Bourdeau L. (ed.) (1999), Construction related sustainability indicators ,
Proceedings of the Meeting of CIB W82, Future Studies in Construction, Espoo,
Finland, 15-16 September.
Breitschopf B. (1999), Financial Sector Study: Yemen, Division 41, Financial
Systems Development and Banking Services, Gesellschaft für Technische
Zusammenarbeit (GTZ), Accessed online in Dec. 2003
www.gtz.de/themen/economic-development/download/yemen.pdf
Brunetti A., Kisunko G. & Weder B., (1997), Institutional Obstacles to Doing
Business: Region-by-Region Results from a Worldwide Survey of the Private
Sector. World Bank, PRD Working 1759. Accessed online in Nov. 2003
http://www.worldbank.org/wbi/governance/pdf/wps1759.pdf
194
Brundtland G. (1987), Our common future, The World Commission on
Environment and Development, Oxford, Oxford University Press.
Central Bank of Yemen (2002), Central Bank Annual Report, General
Department of Research and Statistics. Accessed online in Oct. 2003
http://www.centralbank.gov.ye/ear.pdf
Central Bank of Yemen (2003), Central Bank Annual Report, General
Department of Research and Statistics, Accessed online in Feb. 2004
http://www.centralbank.gov.ye/ear.pdf
Chalabi F.A. & Camp D. (1984), Causes of delays and overruns of construction
projects in developing countries, CIB Proceedings, no. 2, pp. 723-34.
Chen J. J. & Chambers D. (1999), Sustainability and the Impact of Chinese
policy initiatives upon construction , Construction Management and Economics,
vol.17, no.(5), pp. 679-687.
CIA (2003), The World FactBook, Accessed online in Oct. 2003
http://www.cia.gov/cia/publications/factbook/fields/2129.html
CIA (2003b), The World Factbook - Yemen Accessed online in Oct. 2003
http://www.cia.gov/cia/publications/factbook/geos/ym.html
Colton N.A. (1993), Homeward Bound: Yemeni return migration , International
Migration Review, vol. 27, no. 4 (Winter)
Coukis B.P. & Grimes O.F. (1980), Labour-based civil construction , Finance
and Development, a publication of the International Monetary Fund and the
World Bank Group, vol. 17, pp32-35
Daly H. E. (1991), Operational principles for sustainable development, Earth
Ethics, summer, pp. 6-7, Accessed online in Oct. 2002
195
http://www.crle.org/pub_eeindex_sum91.asp
Delbecq André L. (1968), The world within the span of control: Managerial
behaviour in groups of varied size , Business Horizons, August, reprinted in
American Management Association Management Reader, 1970
Delbecq A. L. & Van de Ven A.H. (1971), A Group Process Model for Problem
Identification and Program Planning, Journal of Applied Behavioral Science,
July-August, 1971.
De Soto, H. (1989), The Other Path: The Invisible Revolution in the Third
World. Harper and Row, NY
De Toni A. and Tonchia S. (2003), Strategic planning and firms’ competencies:
Traditional approaches and new perspectives, International Journal of
Operations & Production Management, Vol. 23 No. 9, 2003 pp. 947-976
Dillman Don A. (2000), Mail and Internet Surveys: the Tailored Design
Method. 2nd ed, New York; Chichester, England, Wiley,
Drewer S. (1980), Construction and development: A new perspective. Habitat
International, Vol. 5, 3/4, pp. 395-428.
Du Plessis C. (1999), Sustainable development demands dialogue between
developed and developing worlds , Building Research and Information, vol. 27,
no. (6), pp. 378–389
Du Plessis C. (2002), Finding the Tin Man s Heart – Social Responsibility in the
Construction Sector, Paper prepared for the 9th ENTAC Conference, 7-10 May
2002, Iguaçu do Foz, Brazil.
196
Ebohon O. J. (1996), The scope and limits of sustainable development in Africa's
built environment sector. The International Journal of Sustainable Development
and World Ecology, Vol. 3, No. 1
Ebohon O.J. & Rwelamila, P.D. (2001). Sustainable Construction in Sub-
Saharan Africa: Relevance, Rhetoric and Reality. Position Paper for Agenda 21
for Sustainable Construction in Developing Countries. Accessed online in Aug.
2002
http://www.sustainablesettlement.co.za/policy/postionpapers.html
Economisti Associati (1994), Eastern Africa – Survey of Foreign Investors.
World Bank, Washington, DC, September.
The Editorial (2002), Challenges facing construction industries in developing
countries, Journal of Building Research & Information, 30 (3), pp. 149–151
Edmonds G. A. (ILO) (1979), The construction industry in developing countries,
International Labour Review, 118, (3), 1979, 355-369
Edmonds G.A. & Miles D. (1984), Foundations for Change : Aspects of the
Construction Industry in Developing Countries, Intermediate Technology
publication, London 1984.
Edmonds G. A. & De Veen J. J. (1992), A labour-based approach to roads and
rural transport in developing countries, International Labour Review, Vol. 131,
pp. 95-110.
Elinwa A.U. & Buba S.A. (1993), Construction cost factor in Nigeria , Journal
of Construction Engineering and Management, vol. 119, pp. 698-713
Energy Information Administration, EIA (2003), Yemen Country Analysis Brief.
Accessed online in Mar. 2004
http://www.eia.doe.gov/emeu/cabs/yemen.html
197
Engineering News Record (ENR), (1998), World market overview, Engineering
News Record, 30 November, McGraw-Hill, New York, pp 35–68.
Erdik M. (1992), 22 December 1991 Yemen Earthquake, Soil Dynamics and
Earthquake Engineering, 11 pp 327-334
Ergude S. (2001), Low-cost housing: policies and constraints in developing
countries, International Conference on Spatial Information for Sustainable
Development, Nairobi, Kenya, 2–5 October 2001, United Nations Centre for
Human Settlements (habitat)
Economic and social Commission for West Asia (ESCWA)
(1993), The Absorption of returnees in the Republic of Yemen. In Return
Migration profiles, Impact and Absorption in Home Countries,
E/ESCWA/SD/1993/12, ESCWA, New York, 30 December 1993)
European Union , EU (2001), Sustainable construction final report. Proposals for
a response to the challenges. Accessed online in Oct. 2002
http://europa.eu.int/comm/enterprise/construction/suscon/finrepsus/sucop2.htm
European Commission, EC (2002), Yemen Country Strategy Paper 2002-2006.
National Indicative Programme 2002-2004. Accessed online in May. 2003
http://europa.eu.int/comm/external_relations/yemen/csp/index.htm
European Commission, EC (2003), Political Context. Accessed online in Feb.
2004
http://europa.eu.int/comm/external_relations/yemen/csp/
Fellows, R. and A. M. Liu (2003). Research Methods for Construction. Oxford,UK; Iowa,USA; Victoria, Aust., Blackwell Publishing. pp.151
198
Fergany N. (2001), Aspects of labor migration and unemployment in the Arab
region. Almishkat Center for Research, Egypt. Accessed online in Oct. 2002
(www.almishkat.org )
http://www.worldbank.org/mdf/mdf4/papers/fergany.pdf.
Gale A.W. & Fellows R.F. (1990), Challenge and innovation : the challenge to
the construction industry, Construction Management and Economics, 8, pp.431-6
Ganesan S. (1979), Growth of housing and construction sectors: Key to employment creation. Progress in Planning, Vol. 12, pp. 40-41.
Ganesan S. (1982), The Construction Industry in Sri Lanka. World Employment
Programme Research, International Labour Organisation, Geneva
Ganesan S. (1994), Employment maximisation in construction in developing
countries . Construction Management and Economics, 12, pp. 323-5
Gaude J. & Watzlawick H. (1992), Employment creation and poverty alleviation
through labour- intensive public works in least developed countries.
International Labour Review, Vol. 131, No1, pp. 3-18
Gibis B., Artiles J., Corabian P., Meiesaar K., Koppel A., Jacobs P., Serrano P.
and Menon D. (2001), Application of strengths, weaknesses, opportunities and
threats analysis in the development of a health technology assessment
program Health Policy, Volume 58, Issue 1, Octobe2001, Pages 27-35
The General Investment Authority of Yemen GIAY (2002), Investment Law No.
22 for 2002. Accessed online in Nov. 2003
http://www.giay.org/sec2.htm
Goodland R. & G. Ledec. (1987), Neoclassical economics and principles of
sustainable development. Ecological Modelling, vol.38, pp19-46.
199
Han S. S. & Ofori G. (2001), Construction industry in China’s regional economy,
1990–1998. Construction Management and Economics, 19, 189–205
Harris N. (1992), Cities in the 1990s: The Challenge for Developing Countries,
UCL Press, London.
Hax A.C. & Majluf N.S. 1991, The Strategy Concept and Process: A Pragmatic
Approach, Prentice-Hall,
Hernes T. (1988), Training Contractors for Results: A Guide for Trainers and
Training Managers, Derek Miles (ed), ILO Geneva.
Hill R.C. and Bowen, P.A. (1997) Sustainable construction: principles and a
framework for attainment , Construction Management and Economics, vol.15,
no. 3, pp.233-239.
Hillebrandt P.M. (1985), Economic Theory and The Construction Industry , 2nd
Edn, Macmillan, London.
Hillebrandt P. (1997), Problems of, and some remedies for, some
underdeveloped construction industries. Proceedings of the first international
conference on construction industry development, Building the Future Together.
9-11 December 1997, Singapore.
Hillebrandt P. (1999), Choice of Technologies and Inputs for Construction in
Developing Countries, proceedings of 2nd International Conference on
Construction Industry Development, and 1st Conference of CIB TG 29 on
Construction in Developing Countries 27-29 October 1999, The Pan Pacific,
Singapore. Accessed online in Mar. 2002
http://buildnet.csir.co.za/cdcproc/docs/1st/hillebrandt_pm.pdf
Houben G., Lenie K. and Vanhoof K. (1999), A knowledge-based SWOT-
analysis system as an instrument for strategic planning in small and medium
200
sized enterprises. Decision Support Systems, Volume 26, Issue 2, August 1999,
pp 125-135
International Council for Local Environmental Initiatives, International
Development Research Centre and United nations For Environmental
Development ICLEI, IDRC & UNEP (1996), The Local Agenda 21 Planning
Guide - An Introduction to Sustainable Development Planning, International
Council for Local Environmental Initiatives (ICLEI) Toronto. Accessed online in
Sep. 2003
http://www2.sfu.ca/bmcp/geog-449/9-1.htm
http://www.unhabitat.org/cdrom/governance/html/yellop28.htm
International Council for Local Environmental Initiatives, ICLEI (1997), Local
Agenda 21 Survey . A Study of Responses by Local Authorities and Their
National and International Associations to Agenda 21. Toronto. ICLEI-Canada;
International Council for Local Environmental Initiatives (ICLEI) and Division
for Sustainable Development (DSD), (1998), Study on National Obstacles to
Local Agenda 21, Background Paper 31. Joint study by DSD and ICLEI prepared
for the sixth session of the Commission on Sustainable Development, April.
Accessed online in Sep. 2003
http://www.un.org/esa/sustdev/mgroups/iclei.htm
International Council for Local Environmental Initiatives, ICLEI (1999), Asia-
Pacific Local Agenda 21 Resource Guide. Toronto. ICLEI-Canada Accessed
online in Sep. 2003
http://www.iclei.org/ICLEI/la21.htm
International Council for Local Environmental Initiatives, ICLEI, (1997), Local
Agenda 21 Survey. A Study of Responses by Local Authorities and Their
National and International Asssociations to Agenda 21. Toronto. ICLEI, Canada
Accessed online in Sep. 2003
http://www.iclei.org/LA21/LA21rep.htm
201
International Council for Research and Innovation in Building and Construction
CIB (1999), Agenda 21 for Sustainable Construction , CIB Report Publication
237. Accessed online in Apr. 2002,
http://www.cibworld.nl/pages/begin/AG21.html
International Council for Research and Innovation in Building and Construction/
United nations For Environmental Development- International Environmental
Technology Centre, CIB/UNEP-IETC (2001), Agenda 21 for Sustainable
Construction in Developing Countries. du Plessis C. (Ed), CIB First Discussion
Document, Version 2 –July 2001 Accessed online in Aug. 2002
http://www.sustainablesettlement.co.za/docs/a21_discussiondoc.pdf
http://www.sustainablesettlement.co.za/policy/firstdiscussdoc.html
International Council for Research and Innovation in Building and Construction/
United nations For Environmental Development- International Environmental
Technology Centre CIB/UNEP-IETC (2002), Agenda 21 for Sustainable
Construction in Developing Countries, du Plessis Chrisna, Editor, CIB Final
Discussion Document, 2002 . Accessed online in Mar. 2003
http://www.cibworld.nl/pages/begin/Agenda21Book.pdf
http://www.sustainablesettlement.co.za/docs/A21_BOOK.pdf
http://www.csir.co.za/akani/print/2002/nov/print01.html
International Council for Research and Innovation in Building and Construction
CIB (1999), Managing Construction Industry Development in Developing
Countries, Report on the First Meeting of the CIB Task Group 29. Arusha,
Tanzania, 21-23 September. Rotterdam.
International Institute for Sustainable Development (IISD) (1994), Earth
enterprise tool kit, 2nd ed., International Institute for Sustainable Development
Accessed online in Sep. 2003 http://www.iisd.org/pdf/eetoolkit.pdf
202
International Monetary Fund, IMF (2001), Republic of Yemen: Selected Issues.
Country Report No. 01/61, Accessed online in Oct. 2002
www.imf.org/external/pubs/ft/scr/2001/cr0161.pdf
International Monetary Fund, IMF, (2002), Republic of Yemen, Poverty
Reduction Strategy Paper (PRSP), 2003-2005 Accessed online in Sep. 2003
http://www.imf.org/external/np/prsp/2002/yem/01/
International Labour Office, ILO (1987), Guide-Lines for the Development of
Small-Scale Construction Enterprises . Geneva
International Labour Office, ILO (1991), Migrant workers affected by the Gulf
crisis. Report of the Director General, third supplementary report, GB.249/15/7.
27February-2 March, 1991
International Labour Organization ILO (1996), Labour-Based Technology. Last update: 29 April 2002. Accessed online in Feb. 2003 http://www-ilo-mirror.cornell.edu/public/english/employment/recon/eiip/asist/labour/
International Union for Conservation of Nature and Natural Resources/ United
Nations Development Programme/World Wide Fund For Nature
IUCN/UNEP/WWF (1980), The World Conservation Strategy: Living Resource
Conservation for Sustainable Development . International Union for
Conservation of Nature (IUCN), United Nations Environment Programme
(UNEP) and World Wide Fund for Nature (WWF), Gland, Switzerland – cited
By Barry Dalal-Clayton, IIED ‘What Is Sustainable Development?’ Accessed
online in Jan. 2003 http://www.nssd.net/pdf/sustdev2.pdf
International Union for Conservation of Nature and Natural Resources/ United
Nations Environment Programme/World Wide Fund For Nature
IUCN/UNE/WWF (1991), Caring for the Earth: A Strategy for Sustainable
Living, Principles of a Sustainable Society, Gland, Switzerland, 1991. Accessed
online in May. 2002
203
http://www.globallearningnj.org/global_ata/principles_of_a_sustainable_society.
htm
http://coombs.anu.edu.au/~vern/caring/care-earth5.txt
Jones T. (1980), Options for the Future: A Comparative Analysis of Policy Orientated Forecasts, Praeger Publishers, New York.
Johnson G. & Scholes K. (1989), Exploring strategic management, Scarborough,
Ontario, Prentice Hall.
Johnson S., McMillan J. & Woodruff C. (2000), Entrepreneurs and the ordering
of institutional reform: Poland, Slovakia, Romania, Russia and Ukraine
Compared. Economics of Transition, 8 (1), pp. 1– 36.
Jones, Anna J., Annie R. Pearce, Victoria C.P. Chen (1998), Implementing
Sustainability Knowledge Into The Built Environment: An Assessment Of
Current Approaches, (Accessed 24 November 2002).
http://maven.gtri.gatech.edu/sfi/resources/pdf/CP/CP007.PDF
Kirmani S. (1988), The construction industry in development: issues and options,
discussion paper, Infrastructure and Urban Development Department, World
Bank, Washington DC.
Khalfan M.A. (2000), Sustainable Development and Sustainable Construction: A
literature review for C-SanD. WP/2001/1. Accessed on 5th March 2002,
http://www.c-sand.org.uk/Documents/WP2001-01-SustainLitRev.pdf
Kibert C.J. (1994), Establishing principles and a model for sustainable
construction. Proceedings of the First International Conference of CIB TG16 on
Sustainable Construction, Tampa, Florida, November.
204
Kulkarni, B. V. (1983), A Construction Industry in Transition. Development and
Urban Metamorphosis; Volume 1: Yemen at the Cross-Roads. Evin, Ahmet (ed).
Singapore: Concept Media/The Aga Khan Award for Architecture.
Landman M. (1999), Breaking through the Barriers to Sustainable Building. A
thesis for the degree of Master of Arts, Urban and Environmental Policy, TUFTS
University. (Accessed on Nov 2002)
www.egret.net/mlandmanthesis.pdf
Linstone H. & Turoff, M. (1975), The Delphi Method: Techniques and
Applications, Addison-Wesley, London, 1975
Lopes Jorge (1998), The construction industry and macroeconomy in Sub-
Saharan Africa post 1970 , Construction Management and Economics, vol.16,
pp. 637-649
Low S.P. (1991a), World markets in construction 1: a regional analysis,
Construction Management and Economics, vol.9, no.(1), pp.63–71.
Low S.P. (1991b), World markets in construction 2: a country by country study ,
Construction Management and Economics, vol. 9, no.(1), pp.73–78.
Madu C., Kei C. & Madu A, (1991), Setting Priorities for the IT Industry in
Taiwan - A Delphi Study, Long Range Planning, 1991, v24, n5, pp. 105-118
Malone T.F. (1994), The world after Rio. The role of engineering in sustainable
development, American Association of Engineering Societies AAES,
Washington, D.C. pp. 25-32
Mansfield, N.R., Ugwu, O.O. and Doran T. (1994) Causes of delays and cost
overruns in Nigeria construction projects. International Journal of Project
Management, 12 (4), pp. 254-60.
205
Martino J. (1983), Technological Forecasting for Decision Making. Elsevier
Science Publishing Company, New York
Masser I. and Foley P. (1987), Delphi revisited: expert opinion in urban analysis,
Urban Studies, vol. 24, pp. 217-225
Mauro, P., (1995). Corruption and growth , Quarterly Journal of Economics
110, Issue 3, 681–712.
McKillip, J. (1986), Need Analysis: Tools for the Human Services and
Education. Beverly Hills, Calif. , Sage Publications,
McCuen R.H. ed. (1996), The Elements of Academic Research, ASCE press,
New York
Miles D. & Neale R. (1991), Building for Tomorrow : International Experience
in Construction Industry Development. Geneva, International Labour Office,
1991.
Miles D. (1984), Yemen Arab republic: the construction industry. Development
and Urban Metamorphosis. Volume 2: Background Papers, Editor Ahmet Evin,
The Aga Khan Award for Architecture
Milton R. (2001), Hung out to Dry: Disastrous World Bank intervention in
Yemen , The Ecologist, vol. 31, no. 10, Accessed online in Mar. 2002
http://www.theecologist.co.uk/archive_article.html?article=241
Moavenzadeh F. (1978), Construction in developing countries. World
Development, Vol. 6, No. 1, pp. 97-116.
Moavenzadeh F. & Hagopian, F. (1983), Construction and building materials
industries in developing counties. Technology Adaptation Program, MIT
Camberidge, Massachusetts, prepared for UNIDO
206
Moavenzadeh F. & Hagopian, F. (1984), The construction industry and
economic growth , Asian National Development, June/July, pp. 56-60.
Mohapatra P., Bora M. & Sahu K. (1984), Incorporating Delphi Results in
System Dynamics Models: A Case of Indian Tea Industry, in Technological
Forecasting and Social Change, Vol 25, pp 159-177
Nabalamba A. (1995), National perspectives and priorities: a comparative study
of urbanisation in Uganda and Tanzania, in Arlinghaus S.L. & Drake W.D. (eds),
Population-Environment Dynamics: Transitions in Global Change, University of
Michigan, online, Accessed online in Nov. 2002
http://www-personal.umich.edu/%7Ewddrake/545/nabalamba.htm
Nelms K.R. & Porter A.L. (1985), EFTE: An Interactive Delphi Method.
Technological Forecasting and Social Change. no. 28, 43-61.
Nicholas J. O’Shaughnessy (1996), Michael Porter’s Competitive Advantage
revisited, Management Decision, 34/6, pp 12–20
Organisation for Economic Co-operation and Development/The Development
Assistance Committee, OECD/DAC (1996), Shaping the 21st Century,
document, Accessed online in Sep. 2002
http://webnet1.oecd.org/pdf/M00003000/M00003334.pdf
Ofori G. (1985), Indigenous construction materials programmes : lessons from
Ghana s experience , Habitat International, vol. 9, no. 1, pp. 71-79
Ofori G. (1988), A central data bank for construction. Habitat International, vol.
12, no. (1), pp. 87–94.
Ofori G. (1990), The Construction Industry: Aspects of its Economics and
Management. Singapore University Press, Singapore.
207
Ofori, G. (1991), Programmes for improving the performance of contracting
firms in developing countries: A review of approaches and appropriate options.
Construction Management and Economics, vol. 9, pp19-38.
Ofori G. (1993), Research on construction industry development at the
crossroads , Construction Management and Economics, vol. 11, pp.175–85.
Ofori G. (1994), Practice of construction industry development at crossroads,
Habitat international, vol.18, no. 2, pp. 41-56
Ofori G. (1996), International contractors and structural changes in host-country
construction industries: Case of Singapore. Engineering, Construction and
Architectural Management, Vol. 3, No. 4, pp. 271-288.
Ofori G. (1998), Measuring construction industry development . Proceedings,
First Meeting of CIB Task Group 29 on Managing Construction Industry
Development in Developing Countries, 21–23 September, Arusha, Tanzania,
pp.161–71.
Ofori G. (2000), Challenges of construction industries in developing countries:
lessons from various countries. Proceedings of the 2nd international conference
of the CIB TG29 on Construction in Developing Countries: Challenges facing
the construction industry in developing countries, 15-17 November 2000,
Gabarone, Botswana, pp. 1-3
Ofori George (2001), Indicators for measuring construction industry
development in developing countries, Building Research and Information, vol.
29, no.(1), pp.40–50
Ogunlana, S. O. and Olomolaiye P. O. (1989), A survey of site management
practice on some selected sites in Nigeria, Building Environment, 24 (2), pp 191-
196
208
Ogunlana S. O., Promkuntong K. & Jearkjirm V. (1996), Construction delays in
a fast-growing economy: comparing Thailand with other economies.
International Journal of Project Management, Vol. 14, No. 1, pp. 37-45.
Okpala D. & Aniekwu A. (1988), Causes of high costs of construction in
Nigeria. Journal of Construction Engineering and Management; 114(2), pp.
233–45.
Prahalad C.K. and Hamel G. (1994), Strategy as a field of study: why search for
a new paradigm?, Strategic Management Journal, Vol. 15, pp. 5-16.
Pearce D. (1996), Sustainable Development: The Political and Institutional
Challenge. in J.Kirby, P. O Keefe & L. Timberlake (eds), The Earthscan Reader
in Sustainable Development, Earthscan Publications Ltd, London, p. 312
Porter, M E (1979), The structure within industries and companies' performance,
Review of Economics and Statistics, 61, pp 214-227
Porter, M E (1980), Competitive Strategy: Techniques for Analysing Industries
and Competitors. The Free Press, New York pppp
Porter, M. (1990), The Competitive Advantage of Nations, The Free Press, New
York, NY.
Ramdane Djebarni & Abdullah Al-Abed (1998), Housing adequacy in Yemen:
an investigation into physical quality. Property Management, Volume 16 · no. 1,
1998, pp. 16–23
Raftery J., Pasadilla, B., Chiang Y. H., Hui E. C. M. & Tang B. S. (1998),
Globalization and construction industry development: implications of recent
developments in the construction sector in Asia. Construction Management and
Economics, 16, pp 729-737
209
Raynsford N. (2000), Sustainable Construction: The Governments Role.
Proceedings of ICE, Vol. 138, November.
Reich Y. (1994), Layered models of research methodologies , artificial
intelligence for engineering design. Analysis and Manufacturing, vol. 8, pp. 263-
274
Repetto, R. (1986), World Enough and Time. New Haven, Yale University
press. pp. 15-16
Rieger W. (1986), Directions in Delphi Developments: Dissertations and Their
Quality, in Technological Forecasting and Social Change, Vol 29, pp 195-204
Riggs W. E. (1983), The Dephi technique: An experimental evaluation ,
Technological Forecasting and Social Change, vol.23, No 1, pp. 89-94
Rohatgi K. & Rohatgi P. (1979), Delphi as a tool for identifying future
appropriate technologies in India , Technological Forecasting and Social
Change, Vol. 14, No 1, pp. 65-76.
Roodman D. M. & Lenssen N. (1994), Our Buildings, Ourselves. World Watch.
Institute, November/December, p.21.
Rossi P.H. and Freeman, H.E. (1989), Evaluation: a systematic Approach , 4th
edn., Newbury Park.
Rowe, G., Wright G., & Bolger F., (1991), Delphi: A reevaluation of research
and theory, Technological Forecasting and Social change, Vol. 39, No 3, May,
pp. 235-251.
Ruvkun S. (1981), Construction in Latin America. Journal of Construction
Engineering and Management, vol.107, pp. 313-322
210
Saba News Agency (1998), A working-paper; submitted by the Yemeni Public
Corporation for Manufacturing & Marketing of Cement in May 1998; to the
Consultative Council. Published by the Economic periodical of Saba News
Agency, bulletin number (114) of 16/7/1998. online (accessed Jan. 2003)
http://www.yemeninfo.gov.ye/ENGLISH/ECONOMY/status.htm
Sage A. P. (1998), Risk Management for Sustainable Development. Proceedings
of the IEEE International Conference on Systems, Man and Cybernetics, Vol. 5,
1998, pp 4815-19.
Sajjad M. Jasimuddin (2001), Analyzing the competitive advantages of Saudi
Arabia with Porter’s model, Journal of Business & Industrial Marketing, vol. 16
no. 1, 2001, p. 59-68
Saksena K. D. (1986), Pricing policy and price controls in developing countries.
London Frances Pinter, London
Samuelson P.A. & W.D. Nordhaus (1995), Economics, (15th edition), McGraw
Hill, New York
Saaty T. & Boone L. (1990), Embracing the Future: Meeting the Challenge of
our Changing World. Praeger, New York
Saxena K. B. C. (1996), Re-engineering Public Administration in Developing
Countries, Long Range Planning, Vol. 29, No. 5, pp. 703 to 711,
Sergei Guriev (2003), Red tape and corruption, Journal of Development
Economics , Volume 73, Issue 2 , April 2004, Pages 489-504
Serageldin Ismail. (1982), Rural Architecture in the Yemen Arab Republic: The
Impact of Rapid Economic Growth on Traditional Expression. The Changing
Rural Habitat; Volume I: Case Studies. Brian Brace Taylor (ed). Singapore:
Concept Media, The Aga Khan Award for Architecture
211
Serpell A. & Alarcon L. F. (1998), Construction process improvement
methodology for construction projects, International Journal of Project
Management, vol. 16, no 4, pp 215-221
Silver C. S. & DeFries R.S. (1990), One earth, one future: our changing global
environment. National Academy Press, Washington, DC. Accessed online in Feb.
2003
http://www.nap.edu/books/0309046327/html/index.html
Simpson E.S. (1987), The developing world; an introduction. Longman
scientific and technical Essex, England
Sitarz D. ed. (1993), Agenda 21: The Earth Summit Strategy to Save Our Planet,
Earth press, Boulder, Colorado, pp. 93-95, Cited by Haury, David L, 1998
Education for Environmental Sustainability. ERIC Digest, Clearinghouse for
Science Mathematics and Environmental Education Columbus OH. ERIC
Identifier: ED433194. Accessed online in Aug. 2002
http://www.defra.gov.uk/environment/darwin/lecture/030521.htm
Social Fund for Development SDF (2003), The Rural Roads and Cultural
Heritage Unit. Accessed online in May. 2004,
http://www.sfd-yemen.org/home/cultural_roads.htm
Spence R. (1987), Building materials: time to rediscover local resources.
Appropriate Technology, 13 , 4, pp. 28-30
Spence, R. & Mulligan, H. (1995), Sustainable development and the
construction industry . Habitat International, 19 (3), pp. 279-292
Stone E. F. (1978), Research methods in organizational behaviour, Goodyear
publishing company, Santa Monica, CA
212
Sultan B. & Kajewski S. (2003a), The behaviour of construction costs and
affordability in developing countries: a Yemen case study, Knowledge
Construction Joint International Symposium of CIB Working Commissions W55,
W65 and W107, Singapore, 22-24 October 2003
Sultan B. & Kajewski S. (2003 b), The Yemen Construction Industry:
Readying the Industry for the Successful Implementation of Sustainability , The
CIB 2003 International Conference on Smart and Sustainable Built Environment
(SASBE2003), held on 19-21 November 2003, Brisbane, Australia
Taylor D. W., Berry P. C. and Block, C. H. (1958), Does group participation
when using brainstorming facilitate or inhibit creative thinking?, Administrative
Science Quarterly, 3, 23-47
Tassios S. (1992), Structure & function of the construction industry with
emphasis on developing countries. Paper ID/WG.528/1, 8 September 1992.
prepared for meeting of UNIDO and UNCHS (Habitat), First Consultation on the
Construction industry, Tunis, Tunisia, 3-7 May 1993
Tanzi V., (1998), Corruption Around the World: Causes, Consequences, Scope,
and Cures. International Monetary Fund, Staff Papers, Volume 45, no. 4,
December 1998.
Thom D. (1994), Engineering to sustain the environment. The Role of
Engineering in Sustainable Development. Ellis, M.D., ed. American Association
of Engineering Societies, Washington, DC. pp. 62-80
Todaro M. P. (1985), Economic development in the Third World, New York,
Longman, 1985 3rd ed.
Todaro M. P. (1997), Economic development, New York ; London : Longman,
6th ed., 1997
213
Transparency International TI, (2003), The 2003 Transparency International
Corruption Perceptions Index. Transparency International Organization,
Accessed online in Sep. 2004:
http://www.transparency.org/cpi/2003/cpi2003.en.html
Transparency International, TI (2004), Corruption Perceptions Index 2004.
Transparency International Organization, Accessed online in Sep. 2004:
http://www.transparency.org/cpi/2004/cpi2004.en.html
Tse R.. & Ganesan S. (1997), Causal relationship between construction flows
and GDP: evidence from Hong Kong, Construction Management and
Economics, vol. 15, pp. 371- 376
Turin D.A. (1967), Housing in Africa : Some Problems and Major Policy Issues,
in The Economic Problems of Housing , Nevitt, A.A. (editor). Macmillan ,
London, 1967
Turin D.A. (1972), Construction and development: a frame work for research
and action, a paper prepared for the IBRD (London University College
Enviromental Research Group)
Turin D.A. (1973), The Construction Industry: Its Economic Significance and Its
Role in Development. (2nd ed.), University College Environmental Research
Group UCERG, London.
Turin D.A. (1978), Construction and development. Habitat international, vol. 3,
no. 1/2, pp. 33-45
United Nations Conference on Environment and Development, UNCED (1992),
Agenda 21. The United Nations Programme of Action from Rio. Accessed online
in Jun. 2002,
http://www.un.org/esa/sustdev/agenda21text.htm &
http://www.unep.org/unep/partners/un/unced/agenda21.htm
214
http://www.igc.apc.org/habitat/agenda 21/
http://www.un.org/esa/sustdev/documents/agenda21/index.htm
United Nation Centre for Human Settlement, UNCHS 1981, The Construction
Industry in Human Settlement Programmes, UN CHS/OP/81/6, Nairobi, Kenya,
October 1981
United Nations Centre for Human Settlements (UNCHS) (1984 a), The
Construction Industry in Developing Countries. Contribution to Socio-Economic
Growth, Nairobi,
United Nations Centre for Human Settlements (UNCHS) (1984b), Small-scale
Building Materials Production in the Context of Informal Economy, Nairobi,
HS/45/84/E
United Nations Centre for Human Settlements (UNCHS) 1984 c, Government
Policy Guidelines to Improve the Construction Industry, HS/39/84/E, Nairobi,
United Nations Centre for Human Settlements UNCHS (1985), Planning of the
Construction Industry With Emphasis on the use of Indigenous Production Factor
, Nairobi, HS/82/85/E
United Nations Centre for Human Settlements UNCHS (1991), Energy for
building. United Nation Centre for Human Settlements (Habitat). Nairobi, 1991
United Nations Centre for Human Settlement (UNCHS) (1993), Technology for
Human Settlements: The Role of Construction , UN, Nairobi.
United Nations Centre for Human Settlement, UNCHS (1996a), An Urbanizing
World: Global Report on Human Settlements, Oxford University Press, Oxford.
United Nations Centre for Human Settlements UNCHS (Habitat) (1996b), The
Habitat Agenda, The Habitat Agenda: Goals and Principles, Commitments and
215
Global Plan of Action Istanbul Declaration on Human Settlements, Accessed
online in Aug. 2002
http://www.unchs.org/unchs/english/hagenda/index.htm
United Nations Centre for Human Settlements, UNCHS (Habitat), (2000),
Monitoring the Habitat Agenda Through the Local Agenda 21 Process , by
Walker J. and Bosch A. Habitat Debate, 2000 - Vol.6 No.1, ISSN 1564-9970,
Accessed online in Aug. 2002
http://www.unhabitat.org/HD/hdv6n1/index.html
http://www.unhabitat.org/hd/hdv6n1/7.html
United Nations (2002), List of Least Developed Countries. Accessed online in
Aug. 2003:
http://www.un.org/special-rep/ohrlls/ldc/list.htm &
http://www.unctad.org/Templates/Webflyer.asp?docid=2026&intItemID=1397&
lang=1
United Nations Industrial Development Organization UNIDO/World Bank
Cooperative Programme (1981), Yemen Arab Republic: The Construction
Industry, Report no. 17, Vienna, July 1981.
United Nations Industrial Development Organization UNIDO and UNCHS
(Habitat), (1993), First Consultation on the Construction Industry, Report,
UNIDO, ID/WG. 528/9 Tunis, Tunisia, 3-7 May 1993, pp. 11
United Nations Industrial Development Organisation, UNIDO (1993), Prospects
for the Development of the Construction Industry in Developing Countries,
ID/WG. 528/5, Vienna
United Nations Development Program, UNDP (2002), Human Development
Indicators, Accessed online in Sep. 2003
216
http://hdr.undp.org/reports/global/2002/en/indicator/indicator.cfm?File=indic_28
4_1_1.html
http://hdr.undp.org/reports/global/2002/en/
United Nations Development Program UNDP (2003), Human Development
Indicators 2003, Accessed online in Sep. 2003
http://www.undp.org/hdr2003/indicator/indic_4_1_1.html
http://www.undp.org/hdr2003/pdf/hdr03_HDI.pdf
United Nations Development Program UNDP (2003A), Human Development Indicators 2003, Accessed online in Aug. 2003 http://www.undp.org/hdr2003/indicator/index_indicators.html
http://www.undp.org/hdr2003/indicator/indic_112_1_1.html
UNDP (2003B), Demographic Trends, Human Development Indicators 2003,
Accessed online in Aug. 2003
http://www.undp.org/hdr2003/indicator/indic_40_1_1.html
UNEP (2003), Sustainable building and construction: Facts and Figures, UNEP
Industry and Environment, Accessed online in Feb. 2004
http://www.uneptie.org/media/review/vol26no2-3/005-098.pdf
UN Commission on Sustainable Development (1996), Indicators of Sustainable
Development Framework and Methodologies . United Nations, New York.
Van Dijk J. (1990a), Delphi Method as a Learning Instrument. Bank employees
discussing an automation project , Technological Forecasting and Social
Change, Vol. 37, No 4, July, pp. 399-407
Van Dijk, Jan, (1990b), Delphi Questionnaires versus Individual and Group
Interviews, Technological Forecasting and Social Change, Vol. 37, No 3, May,
pp. 293-304.
217
Viljoen J. and Dann S. (2003), Strategic Management, 4th edition, Prentice Hall,
Prentice Hall, Australia
Wahab (1990), A new direction for building and road research in Nigeria, in
proceedings of CIB 90, Building economics and construction management,
Sydney, vol. 5, pp. 183-94
Waissbluth M. & A.D. Gortari 1990, A Methodology for Science and
Technology Planning Based upon Economic Scenarios and Delphi Techniques,
Technological Forecasting and Social Change, Vol. 37, (1990), pp.383 397.
Watuka J & Aligula EM (2002), Sustainable construction practices in the
Kenyan construction industry: The need for a facilitative regulatory environment.
CIB W107 1st International Conference: Creating a sustainable construction
industry in developing countries, 11 to 13 November 2002, Stellenbosch, South
Africa, Accessed online in Apr. 2003
http://buildnet.csir.co.za/cdcproc/docs/3rd/watuka.pdf
Webler T., Levine D., Rakel H. & Renn O. (1991), A Novel Approach to
Reducing Uncertainty: The Group Delphi, Technological Forecasting and Social
Change Vol 39, pp 253-263
Wells J. (1985), The Role of Construction in economic Growth and
Development, Habitat International, vol. 9, no. 1, pp55-70
Wells J. (1986), The Construction Industry in Developing Countries: Alternative
Strategies for Development. Croom Helm Ltd., London
Wells J. (1999), The construction industry in low income countries: an agenda
for research, In Proceedings of the 2nd International Conference on Construction
Industry Development and 1st Meeting of CIB Task Group 29, Singapore, 27–9
October, Vol. 1, pp. 132–40.
218
Wells J. (2001), Construction and capital formation in less developed economies:
unraveling the informal sector in an African city. Construction Management and
Economics, (2001) 19, 267–274
Wells J., Sinda H. S. & Haddar F. (1998), Housing and Building Materials in
Low-Income Settlements in Dar es Salaam, Habitat International , vol. 22, no. 4,
pp 397-409
World Bank Country Classification, Accessed online in Apr. 2002
http://www.worldbank.org/data/countryclass/countryclass.html
http://www.worldbank.org/data/databytopic/GNIPC.pdf
World Bank (1981), The Road Maintenance Problems and International
Assistance. World Bank, Washington D.C.
World Bank (1984), The Construction Industry: Issues and Strategies in
Developing Countries, International Bank for Reconstruction and Development,
World Bank, Washington, D.C. Henriod et al,
World Bank (1987), Trade and industrial policies in the developing countries of
east Asia , World Bank, Washington, DC.
World Bank (1988), World development report, Washington DC
The World Bank Development reports 79, 81, 85, 86, 91,92,94,95, 96,97, 98/99,
2000-1 Oxford University Press, online:
http://devdata.worldbank.org/data-query/
http://devdata.worldbank.org/external/CPProfile.asp?SelectedCountry=YEM&C
CODE=YEM&CNAME=Yemen%2C+Rep.&PTYPE=CP
www.worldbank.org/data
http://www.worldbank.org/data/databytopic/GNIPC.pdf
http://www.worldbank.org/data/quickreference/quickref.html
http://www.worldbank.org/data/countryclass/countryclass.html
219
World Bank (1994), World Development Report 1994: Infrastructure for
Development. Oxford University Press, Washington, DC.
The World Bank (1999) World Development Indicators 1999. McGill
World Bank (2002a), The Republic of Yemen Economic Growth: Sources,
Constraints and Potentials Report No. 21418-YEM -31 May 2002, Social and
Economic Development Group, Middle East and North Africa Region,
Development Group, Middle East and North Africa Region, Accessed online in
Aug. 2003
http://lnweb18.worldbank.org/mna/mena.nsf/Attachments/Growth2002/$File/Gr
owth-letter.pdf
World Bank (2002b), World Development Indicators 2002, Accessed online in
Feb. 2003
http://www.worldbank.org/data/wdi2002/index.htm
World Bank , (2002c), Yemen: Poverty Reduction Strategy Paper (PRSP),
Accessed online in Jul. 2003
http://poverty.worldbank.org/files/Yemen_PRSP.pdf
World Bank (2003), World Bank s development databases: Selected World
Development Indicators SWDI 2003, Accessed online in Dec. 2003
http://rrojasdatabank.net/wdr2003/swidi.pdf
World Bank (2004), Yemen Economic Update. The World Bank Group, Sana’a
Office Social and Economic Development Group (MNSED), Middle East and
North Africa Region. Prepared by Nadir Mohammed & Maria Handal. Accessed
online in Aug. 2004
http://www.worldbank.org.ye/
http://lnweb18.worldbank.org/mna/mena.nsf/Attachments/Yemen+Update-
Spring2004/$File/YE-Spring2004.pdf
220
Woudenberg F. (1991), An Evaluation of Delphi, Technological Forecasting and
Social Change, Vol 40, pp 131-150
Wyatt D.P. (1994), Recycling and serviceability: the twin approach to securing
sustainable construction , in First International Conference of CIB TG 16 on
Sustainable Construction, Tampa, Fl, 6-9 November, pp. 113-22.
Yin R. K. (2003), Case Study Research : Design and Methods. Thousand Oaks,
Calif., Sage Publications, 2003. 3rd ed.
Yuxiang C., Donghua Z. and Changgeng L., (1990), Applications of the Delphi
method in China, Technological Forecasting and Social Change , vol. 38, Pages
293-305
Zawdie G. & Langford D.A. (2002), Influence of construction-based
infrastructure on the development process in Sub-Saharan Africa. Building
Research & Information, 30(3), pp160–170
Zuvekas (1979), Economic Development: an introduction. St Martin s press,
New York
221
APPENDIX A-1
SOCIO-ECONOMIC INDICATORS FOR SELECTED
COUNTRIES
HDI Rank country
GDP per
capita
GDP per
capita
GDP per capita
++
GDP per capita
(PPP US$)@
Unemployment 2001*
(1978) 1999 2001 2001
139 Bangladesh 114 370 370 1,610 40%
165 Chad 172 (75) 200 200 1,070 NA%
104 China 780 890 4,020 Urban 10
161 Ivory coast 1014 710 630 1,490 Urban 13 (98)
120 Egypt 628 1,400 1530 3,520 12 (2001)
129 Ghana 913 (77) 390 290 2,250 20 (97)
127 India 187 450 460 2,840 8.8 (2002)
90 Jordan 865 1,500 1750 3,870 16% official rate; actual rate is 25%-30%
146 Kenya 359 360 340 980 40% (2001 est.)
143 Nepal 121 220 250 1,310 47% (2001 est.)
155 Nigeria 717 (77) 310 290 850 28% (1992 est.)
144 Pakistan 254 470 450 1,890 7.8% plus substantial underemployment
156 Senegal 361 510 480 1,500 48% (urban youth 40%) (2001 est.)
99 Sri Lanka 196 820 830 3,180 8% (2002)
138 Sudan 488 330 1,970 18.7% (2002 est.)
110 Syria 1030 970 1000 3,280 20% (2002 est.)
160 Tanzania 249 240 270 520 NA%
148 Yemen 215 (75) 350 460 790 30% (1995 est.)
Least Developed Countries
- - - 1,274 -
Developing Countries - - - 3,850 -
OECD - - - 23,363 -
Sources: # UNDP (2003), * CIA (2003), ++ World Bank (2003) and @
(2002b),
222
APPENDIX A-2
URBAN POPULATION (AS % OF TOTAL POPULATION) FOR
SELECTED COUNTRIES
HDI Rank Country Total population (millions) # Urban population (as % of
total)
1975 2001 2015 1975 2001 2015
139 Bangladesh 75.2 140.9 181.4 9.9 25.5 34.4
Chad 4.1 8.1 12.1
104 China 927.8 1,285 1,402 17.4 36.7 49.5
161 Ivory coast 6.8 16.1 19.8 32.1 44.0 50.9
120 Egypt 39.3 69.1 90.0 43.5 42.7 45.8
129 Ghana 9.9 20.0 26.4 30.1 36.4 42.4
India 620.7 1,033 1,246
90 Jordan 1.9 5.2 7.0 57.8 78.8 81.1
146 Kenya 13.6 31.1 36.9 12.9 34.3 47.2
143 Nepal 13.4 24.1 32.0 5.0 12.2 17.9
152 Nigeria 54.9 117.8 161.7 23.4 44.8 55.5
144 Pakistan 70.3 146.3 204.5 26.4 33.4 39.5
156 Senegal .8 9.6 13.2 34.2 48.1 57.4
99 Sri Lanka 13.5 18.8 20.6 22.0 23.1 29.9
138 Sudan 16.7 32.2 41.4 18.9 37.0 48.7
110 Syrian 7.5 17.0 23.0 45.1 51.8 57.9
160 Tanzania 16.2 35.6 45.9 10.1 33.2 46.2
148 Yemen 6.9 18.7 30.7 16.6 25.0 31.2 Sources: UNDP 2003
223
APPENDIX A-3
CONSTRUCTION ECONOMY INDICATORS
Source: UNCHS 1984
224
APPENDIX B-1
YEMEN SOCIO-ECONOMIC INDICATORS
year Population (million)
GNP US$
GDP/capita PPP (US$)
Exchange rate v US$
Inflation % pa
1990 11.876 664 1090 16.5-25 -
1991 13.411 520 1374 25 -
1992 13.854 - - 32-36 -
1993 14.312 - - 36-45 -
1994 14.785 280 45-69 -
1995 15.250 270 460 95-110 -
1996 15.692 260 552 110-126 40
1997 16.139 330 640 129.28-135 12
1998 16.599 360 740 135.8-140.9 -5
1999 17.5 370 720 155.7 8
2000 17.7 380 750 164.59 23
2001 18.078 420 820 166-172 20
2002 18.701 490 750 178 4.3
2003 19.35 460 800 183 13.6
Sources: The World Bank Development reports, World Bank 2003, CIA 2003B, IMF 2003
225
APPENDIX B-2
RELATIVE IMPORTANCE OF ECONOMIC SECTORS TO
GROSS DOMESTIC PRODUCT IN YEMEN FOR THE YEARS
1994-1999 AT CONSTANT MARKET PRICES
(IN PERCENTAGES)
Source: International Monetary Fund IMF (2001)
226
APPENDIX B-3
STATUS OF THE CEMENT INDUSTRY IN YEMEN
The cement industry had been since its establishment in 1973 favorably
supported by the state, whereby the latter obtained the amounts of loans
necessary to financing the three main factories.
The Year Quantities in tones
1990 835,054
1991 846,812
1992 814,407
1993 1,083,753
1994 914,952
1995 1,088,638
1996 1,041,321
1997 1,229,126
Source: extracted from Saba News Agency (1998)
227
APPENDIX C-1
LETTER TO STAKEHOLDERS FOR THE SURVEY ON THE LOCAL CONSTRUCTION INDUSTRY OF YEMEN
Dear participant, The construction industry is a major contributor to the national economy of many countries. This industry is also a major consumer of natural and human resources. The construction industry in the developing economy of Yemen is characterised by severe problems, which permeate most aspects of the industry, from initial feasibility and design through to cost management and construction. Considerable capital and resources are wasted within the construction process, which has a direct flow-on effect for the national economy and socio-economic development. The development of the construction industry, which aims to achieve efficiency, quality, affordability and sustainability is strongly tied to the economy, therefore solutions should be offered within the local capabilities and operating environments. The survey’s main question is:
What are the real constraints in the construction industry development?
As a key stakeholder, you are invited to participate in a survey of the Yemen Construction Industry. Your input will be important to provide us with an understanding of the industry and key strategies for future sustainable development. This survey is carefully designed to take the shortest time possible. I value your participation and thank you for the commitment of time, energy and effort. If you have any further questions, I can be reached at the address below. Sincerely, Basel Sultan PhD candidate Faculty of Engineering Queensland University of Technology, GPO Box 2434, Brisbane, Queensland, 4001, Australia, Emails: [email protected]
228
APPENDIX C-2
SURVEY
PARTICIPANTS DETAILS:
Name/ institution:
Which sector do you represent? Private sector Government Academic
Other (please specify) • This survey is designed to be completed electronically. Send the file back as an email
attachment • Please click in appropriate boxes by clicking inside boxes, or by typing where
indicated in the shaded grey fields • Please complete this survey by 10th Decmber 2003
DEFINITIONS (Please you will find these Definitions useful)
By construction industry we mean: All forms of building; civil works, building & including infrastructure; telecommunications & electrical installations; consulting services & supply of materials.
Waste has defined as “any thing different from the absolute minimum amount of resources of materials, equipment, and manpower necessary to add value to the product’. In general, all construction activities that produce cost, direct or indirect, but do not add value or progress to the product can be called waste. Waste in construction is not only focused on the quantity of waste of materials on-site, but also related to several activities such as overproduction, waiting time, material handling, processing, traveling, inventories and movement of workers.
Informal sector: includes all construction activities carried out by individuals or groups on self-help basis without a regulated process of contracting. These activities are usually not recorded in national accounts.
Labour-Based Technology is a construction technology which aims to apply a labour/equipment mix that gives priority to labour, but supplements labour with appropriate equipment where necessary for reasons of quality or cost.
229
The following section (A) is designed to obtain some knowledge on the main issues and deficits that affecting your local construction sector
Section A
Please give a ranking to the following factors according to their high or low influence
Hig
h fa
ctor
Med
ium
fact
or
Low
fact
or
Inadequate supply of materials Inadequate supply of skilled labour Inadequate supply of specifications Inadequate supply of affordable land Inadequate supply of affordable infrastructure Inadequate finance system Poor utilization of local building materials Poor utilization of local building technologies Inappropriate law and legislation Lack of standardization of local materials Lack of focused research and experimental projects Informal sector
1. Barriers for achieving efficient construction development are:
Administrative problems and bureaucracy
Market problems
Financing Difficulties in acquiring skilled labour and technicians Poor plant locations and land problems Poor local conditions and infrastructure Lack of studies and information Administrative problems and bureaucracy
2. Reason for the lack of full capacity in building materials:
230
Cont. Section A
Please give a ranking to the following factors according to their high or low influence
Hig
h fa
ctor
Med
ium
fact
or
Low
fact
or
Expensive local materials Expensive imported materials Expensive labour Excessive wastage Inefficient designs Inefficient Local construction methods Expensive and inefficient transportation and delivery Inflation and fluctuation of prices
3. The high Construction cost is due to:
Lack of cost effective methods
Lack of planning and management
Resources misused Unclear information and information quality problems Resources quality problems Lack of execution skills Lack of control and supervision Inefficient procurement and transportations
4. Causes of waste:
The designers awareness of the construction wastes
231
Sections B, and C are designed to obtain some data and particulars on the existing local construction sector
Section B
1. What methods do you use in construction? Labour intensive
labour-base
machine/capital
2. What is your distribution (breakdown) of construction
cost?
Materials
Labour
Plant
Overhead
&Profit
%
%
%
%
3. What is your distribution (breakdown) of construction cost?
Structural Finishes
% %
4. Do you depend on informal or formal sector in
construction projects?
Formal
informal
Section C
5. Please add Any other comments, including suggestions? (this section is optional)
Thank you
232
APPENDIX C -3
RESULTS OF SURVEY
Section A
%
Factors
Hig
h fa
ctor
Med
ium
fact
or
Low
fact
or
Impo
rtan
ce
inde
x
Ran
king
The availability of materials 3 69 28 58 12
The availability of skilled labour 31 59 10 74 8
The availability of specifications 23 69 8 72 10
Inadequate supply of affordable land 38 41 21 73 9
Inadequate supply of infrastructure 69 28 3 89 2
Inadequate finance system 59 38 3 85 4
Poor utilization of local building materials 33 33 33 67 11
Poor utilization of local building technologies 8 54 38 56 13
Inappropriate law and legislation 69 21 10 86 3
Lack of standardization of local materials 44 54 3 80 6
Lack of focused research 38 59 3 79 7
Informal sector 56 41 3 85 5
Administrative problems and bureaucracy 79 18 3 92 1
Barriers to achieving construction development
Market problems 13 82 5 69 7
Difficulty in getting materials 13 79 8 68 8
Financing 49 49 3 82 4
Difficulties in acquiring skilled labour and technicians 49 33 18 77 5
Machinery lacking 15 62 23 64 9
Poor plant locations and land problems 21 72 8 71 6
Poor local conditions and infrastructure 56 44 0 85 2
Lack of studies and information 54 38 8 82 3
Reason for the lack building materials industry
Administrative problems and bureaucracy 59 41 0 86 1
233
%
factors
Hig
h fa
ctor
med
ium
fact
or
low
fact
or
Impo
rtan
ce i
ndex
Ran
king
Expensive local materials 8 77 15 64 8
Expensive imported materials 79 21 0 93 2
Cost of labour 3 54 44 53 9
Excessive wastage 59 41 0 86 3
Inefficient designs 28 49 23 68 6
Inefficient Local construction methods 18 79 3 72 5
Expensive and inefficient transportation and delivery 23 56 21 68 7
Inflation and fluctuation of prices 92 8 0 97 1
Lack of cost effective methods 54 46 0 85 4
Construction cost is high due to:
Lack of planning and management 44 54 3 80 1
Resources misused 49 33 18 77 3
Unclear information and information quality problems 41 49 10 77 4
Resources quality problems information / 31 67 3 76 5
Lack of execution skills 31 64 5 75 6
Lack of control and supervision 46 41 13 78 2
Causes of waste
Inefficient procurement and transportations 31 33 28 62 7
234
Section B
1. What methods do you use in construction? Labour-intensive
labour-based
machine/capital
26.6%
66.7%
6.7%
2. What is your distribution (breakdown) of
construction cost?
Materials
Plant
Labour
Overhead &Profit
48.30%
13.75%
22.28%
16.67%
3. What is your distribution (breakdown) of construction cost?
Structural Finishes
53.1% 46.9%
4. Do you depend on informal or formal sector in
construction projects?
Formal
Informal21
13.4%
86.6%
21 A number of stakeholders noted a 100% reliance on informal sector
235
APPENDIX D-1
LETTER FOR ROUND ONE DELPHI
2004 Dear participant, Thank you for your interest in my research to develop a strategy for the construction industry in Yemen. I value the unique contribution that you can make to my study. You have been selected as a member of a panel of experts to participate in a two round questionnaire on the Yemen Construction Industry. The research methodology I am using is a qualitative one through which I am seeking comprehensive description of your experience in the construction industry. In this way I hope to answer my research question:
How could the construction industry in Yemen achieve economic efficiency and sustainability?
Through your participation and professional experience, I hope to formulate a strategy and a set of recommendations. You will be asked for opinions based on experience gained within your professional life to best approach the problem I am investigating. I am seeking solutions and strategies you think will be appropriate for the developing economy of Yemen. I value your participation and thank you for the commitment of time, energy and effort. If you have any further questions, I can be reached at the address below. Sincerely, Basel Sultan PhD candidate Queensland University of Technology, GPO Box 2434, Brisbane, Queensland, 4001, Australia, Emails: [email protected] Emails: [email protected]
236
APPENDIX D-2
DELPHI QUESTIONNAIRE ROUND ONE
PURPOSE The purpose of this survey is to obtain the expert opinion on most important policies and strategies that will stimulate and sustain the economy of the construction industry in Yemen. The construction industry has the potential to enhance economic sustainability through its structure, conduct and performance. An economically efficient construction industry enhances economical sustainability by ensuring least cost methods of construction and optimal allocation of resources and discouraging wastes. INSTRUCTIONS (Please review these instructions to understand the purpose of this survey and to be able to answer the questions.). This survey is divided in two rounds:
First round – please review the list of strategies and policies and rank their importance Second round – the participants will be able to review the list of strategies It should take only 20 minutes to fill out each round of the survey.
INSTRUCTIONS– PART 1 – please read the following definitions Sustainable Development is defined as: “Economic and social development that meets the needs of the current generation without undermining the ability of future generations to meet their own needs”. Sustainable construction means that the principles of sustainable development are applied to the comprehensive construction cycle from the extraction and beneficiation of raw materials, through the planning, design and construction of buildings and infrastructure, until their final deconstruction and management of the resultant waste. Sustainable construction adopted the concept of sustainability and relates it to building and construction activities. Originally the term `sustainable construction’ was proposed to describe the responsibility of the construction industry in attaining `sustainability’.
The key contribution of the construction industry to economic sustainability is manifested through: • Sustained and efficient use of resources and materials • Sustained employment opportunities through formal
construction, • Sustained employment opportunities through material
production and distribution, • Sustained employment through related services like
transport, financial, marketing and rental/sale of property,
• Sustained employment through operation and maintenance during the economic life span of the buildings,
• Sustained investment and capital formation opportunities for the economy.
An economically efficient construction industry enhances economical sustainability by ensuring least cost methods of construction and optimal allocation of resources and discouraging wastes.
INSTRUCTIONS– PART 2 – please, give your details
Which sector do you represent? Government
Private Academic Other…..
Name
Orgnisation
Your position
Years of experience
Your contact address
Your Email
qualification and achievement
237
ROUND ONE – From your experience of Yemeni capabilities and deficiencies, please rank the policies and strategies below in what you consider to be the level of need. 1 being the most needed and 8 being the least needed to attain economic sustainability of the construction industry in Yemen.
Please make sure no ranking numbers are repeated
POLICIES / STRATEGIES ranking
I. LABOUR-INTENSIVE CONSTRUCTION POLICIES. (promotion of employment by mandating minimum crew size and supervisors and use of less machinery in construction projects, associated with import reduction of machines, spares and foreign exchange savings )
II.
ENERGY-EFFICIENT POLICIES IN DESIGN AND CONSTRUCTION. (Mandating the use of low embodied energy materials such as stone and mud, minimizing high energy materials such as cement and steel. Energy reduction in buildings via insulation, day lighting, optimize material use and minimize site waste)
III.
CREDIT AND FUNDING POLICIES TO SELECTED PROJECTS. (Providing credit and financial services, loan guarantee schemes and tax allowances to small to medium size formal and informal stakeholders. Safeguards should be set on favouring efficiently and economically designed and procured projects and on inputs and reuse of locally available natural resources)
IV. LOCAL MATERIALS PROTECTION POLICY. (Encouraging production and use of local low-energy materials by lowering taxes increase quality, and restriction on selected imported materials.)
V.
STRATEGIES FOR SUSTAINING THE CONTINUITY OF AFFORDABLE INFRASTRUCTURE PROJECTS. (Infrastructure projects can help enhance the process of industrialization by raising productivity and reducing production cost. Poor investment decisions with respect to the choice of infrastructure projects could have devastating effect on the economy)
VI.
STRENGTHENING THE LAW AND REGULATIONS IN CONSTRUCTION AND LAND AFFAIRS. (sort out all legal rights for investors and tenures via legal agencies to ensure the well conduct of the industry activities in a sustainable and efficient manner)
VII. PRICING POLICIES (Maintain the monetary and fiscal discipline required to promote price control)
VIII. IMPROVE ADMINISTRATION EFFECTENESS. AND REDUCE BUREAUCRATIC PROCEDURES (RED TAPE) (Abandon all unnecessary and complicated procedures, collectively minimize corruption.)
238
INSTRUCTIONS– PART 3 - Please indicate any additional strategy not presented in the previous list that you consider important for achieving economic sustainability in the construction industry.
THANK YOU
239
APPENDIX D-3
DELPHI ROUND TWO LETTER
2004
Dear participant, Thank you for your response to the first questionnaire and for your commitment to the process. Your continued participation is critical. As we indicated in the beginning, this process involves a series of two rounds. Enclosed is the second round questionnaire based on what you and the other experts provided on the first round. We now need you to rank order the items to confirm their importance in view to other expert’s opinions. Please return your questionnaire as an email attachment by 7 April. I value your participation and thank you for the commitment of time, energy and effort. If you have any further questions, I can be reach at the address below. Sincerely, Basel Sultan PhD candidate Faculty of Engineering Queensland University of Technology, GPO Box 2434, Brisbane, Queensland, 4001, Australia, Emails: [email protected]
240
APPENDIX D-4
DELPHI QUESTIONNAIRE ROUND TWO
PURPOSE The purpose of this survey is to obtain the expert opinion on most important policies and strategies that will stimulate and sustain the economy of the construction industry in Yemen. The construction industry has the potential to enhance economic sustainability through its structure, conduct and performance. An economically efficient construction industry enhances economical sustainability by ensuring least cost methods of construction and optimal allocation of resources and discouraging wastes. The questionnaire question is to answer
How could the construction industry in Yemen achieve economic efficiency and sustainability?
Please read the following definitions Sustainable Development is defined as: “Economic and social development that meets the needs of the current generation without undermining the ability of future generations to meet their own needs”. Sustainable construction means that the principles of sustainable development are applied to the comprehensive construction cycle from the extraction and beneficiation of raw materials, through the planning, design and construction of buildings and infrastructure, until their final deconstruction and management of the resultant waste. Sustainable construction adopted the concept of sustainability and relates it to building and construction activities. Originally the term `sustainable construction’ was proposed to describe the responsibility of the construction industry in attaining `sustainability’.
The key contribution of the construction industry to economic sustainability is manifested through: • Sustained and efficient use of resources and
materials • Sustained employment opportunities through
formal construction, • Sustained employment opportunities through
material production and distribution, • Sustained employment through related services
like transport, financial, marketing and rental/sale of property,
• Sustained employment through operation and maintenance during the economic life span of the buildings,
• Sustained investment and capital formation opportunities for the economy.
An economically efficient construction industry enhances economical sustainability by ensuring least cost methods of construction and optimal allocation of resources and discouraging wastes.
Name
Orgnisation
Your Email
241
ROUND TWO – From your experience of Yemeni capabilities and deficiencies, please confirm your ranking of the policies and strategies below, base on other expert opinion, from 1 being the most needed and 8 being the least needed to attain economic sustainability of the construction industry in Yemen.
Please make sure no ranking numbers are repeated
POLICIES AND STRATEGIES Experts rankings Confirm
Your ranking
A B C D E F G H I J
LABOUR-INTENSIVE CONSTRUCTION POLICIES. (promotion of employment by mandating minimum crew size and supervisors and use of less machinery in construction projects, with import reduction of machines, spares and foreign exchange savings )
6 7 5 2 5 3 6 6 6 5
ENERGY-EFFICIENT POLICIES IN DESIGN AND CONSTRUCTION. (Mandating the use of low embodied energy materials such as stone and mud, minimizing high energy materials such as cement and steel. Energy reduction in buildings via insulation, day lighting, optimize material use and minimize site waste)
2 3 3 7 3 7 7 5 5 4
CREDIT AND FUNDING POLICIES TO SELECTED PROJECTS. (Providing credit and financial services, loan guarantee schemes and tax allowances to small to medium size formal and informal stakeholders. Safeguards should be set on favouring efficiently and economically designed and procured projects and on inputs and reuse of locally available natural resources)
7 8 4 8 7 4 4 7 8 7
LOCAL MATERIALS PROTECTION POLICY. (encouraging production and use of local low-energy materials by lowering taxes increase quality, and restriction on selected imported materials)
8 6 7 4 4 8 1 4 3 8
STRATEGIES FOR SUSTAINING THE CONTINUITY OF AFFORDABLE INFRASTRUCTURE PROJECTS. (infrastructure projects can help enhance the process of industrialization by raising productivity and reducing production cost., Poor investment decisions with respect to the choice of infrastructure projects could have devastating effect on the economy)
3 4 2 3 8 5 2 3 1 2
STRENGTHENING THE LAW AND REGULATIONS IN CONSTRUCTION AND LAND AFFAIRS. (sort out all legal rights for investors and tenures via legal agencies to ensure the well conduct of the industry activities in a sustainable and efficient manner)
5 5 1 6 2 1 5 2 7 1
PRICING POLICIES (maintain the monetary and fiscal discipline required to promote price control.)
4 2 8 1 6 6 8 8 4 6
IMPROVE ADMINISTRATION EFFECTENESS AND REDUCE BUREAUCRATIC PROCEDURES (abandon all unnecessary and complicated procedures, collectively minimize corruption)
1 1 6 5 1 2 3 1 2 3
THANK YOU
242
APPENDIX E
PICTURES OF YEMENI BUILDING
E-1 TRADITIONAL BUILDING CONSTRUCTION IN YEMEN The main characteristics of the traditional construction are the use of local materials and the implementation of indigenous methods and techniques.
Picture 1 Traditional buildings built in Sana’a
The traditional buildings may have as many as eight storeys and they have load-bearing walls constructed with either exposed hewn stone or rammed earth or earth-blocks, depending on the material available in the region.
Picture 2 Traditional buildings built in Shibam
243
E-2 MODERN/TRADITIONAL BUILDING CONSTRUCTION IN YEMEN
Picture 4 Modern buildings built from stone walls and concrete
The modern/conventional construction in Yemen refers to buildings built
recently and after the 1960s, mostly in cities and large towns, and whose main characteristic is the reinforced concrete frame. Walls are made of concrete blocks
and sometimes an additional facing of local stone. Characterised by excessive use and waste of stone and concrete work
Picture 3 Modern/Traditional buildings built from stone walls and concrete
244
Picture 5 Modern buildings built from concrete frame and stone walls
Picture 6 Modern buildings built from stone walls and concrete blocks
245
Picture 6 Modern buildings built from concrete frame and stone walls
246
E-3 INFRASTRUCTURE IN YEMEN
Picture 7 Lack of infrastructure and access roads
247
APPENDIX F
THE RESEARCHERS’ BACKGROUND
The researcher is a qualified structural and constructional engineer. The
researcher was born in Yemen (research site); studied primary and
secondary schooling in Yemen; completed his Bachelor and Master
degrees in civil and structural engineering from the United Kingdom; has
been involved in the construction industry in Yemen since 1989, was
appointed as a lecturer in 1991 at Sana’a University. With over 12 years of
experience in private and public sector construction, he has extensive
expertise in consultancy and project management services across the
government, corporate and university sectors. He has planned and
executed the construction of a number of buildings including the World
Bank central office building in Sana’a and contributed in key infrastructure
projects such as the Sewerage Treatment Plant project in Sana’a. In
addition he has established his own business specialising in the design and
construction of domestic houses, villas and multi-storey buildings for the
private and the commercial sectors.
