Parliament must probe ‘unusual’ high cost of building materials – Kwaku Kwarteng

A former Deputy Finance Minister, Kwaku Kwarteng has charged Parliament to look into the reasons behind the recent hikes in the prices of building materials such as sand, stones, cement, iron rods and the likes.

Some building contractors in the past few months have been lamenting the continuous toll the price hikes on building materials, have been having on their businesses.

Speaking on the floor of Parliament on Wednesday, July 7, 2021, Kwarteng noted that if the situation is not checked, prices of other building-related services will also rise.

These price developments have triggered further hikes in building-related services, such as excavations, drilling, tiling etc. Indeed, I have heard complaints that even water supply to construction sites and construction labour have all become unusually more expensive. It is hard to figure out the source of these unusual price increases. We know that Parliament has not passed any law that could have added any tax or levy to the prices of these items.”

Mr. Speaker, it is a strange development that must be frontally addressed. We need to check this for the sake of the construction industry, and more importantly, we need to get to the bottom of this disturbing development to ensure that it does not spread to other commodities and other industries on the market. It is, therefore, my respective view that Parliament needs to take steps, under our standing orders and the law, to assist the country deal with this matter,” he added.

Estate developers lament exponential increase in prices of building material

Building contractors in the country have complained about the hikes in the prices of building materials.

As the demand for houses increases, the COVID-19 induced restrictions have had a negative toll on the construction industry.

This has been widely attributed to the exponential increase in construction materials, which are mostly imported.

Some of the major construction items which prices have been affected include iron rods and cement.

It is worthy to note that a ton of iron rods which used to cost GHS4,000 only a few months ago has shot up to a little over GHS5,000.

Checks by Citi Business News have also revealed that a bag of cement has increased by GHS3 from GHS38 and now selling at GHS41.

Samuel Amegayibor, Executive Secretary of Ghana Real Estate Developers Association (GREDA) believes these price hikes have contributed to the dip their businesses are currently facing.

Even though Citi Business News could not receive comments from cement manufacturers on why this is so, Mr. Amegayibor explained what could have influenced the marginal increase in prices.

I called the cement manufacturers, and they admitted that there has been a price hike, and it’s because of certain challenges they are facing in importing the major material which is called clinker. They are telling us that some of the sources of the clinker have either closed down, and generally, the international market price has gone up and also the cost of freight has also gone, and shipping lines have attributed it to the cost of crude oil, which has also spiked.”