THE Sarawak government has been asked to emulate the federal government and allow construction companies to renegotiate contracts with the state, to take into account fluctuating prices of building materials.

At a press conference this morning, Sarawak DAP chairman Chong Chieng Jen said the ballooning cost of building materials meant it was “almost impossible” for companies awarded construction contracts prior to November “to continue without making huge losses”.

Chong, the assemblyman for Padungan, said many simply could not afford to proceed with the terms of their current contract, adding that in the past year, the price of construction material has increased “tremendously”.

“Steel prices have almost doubled. Even the prices of locally produced cement, sand and gravel have increased.”

On May 1, in an attempt to deal with the problem, the Ministry of Works issued a directive allowing the contractors to review prices, Chong said, adding that blacklisting and terminating the contracts for companies that could not continue is not the answer.

“Many GPS assemblymen have urged the government to blacklist these contractors and punish them,” he said.

“The sudden surge material costs is something that is beyond the control of these contractors.

“Given that all of us have suffered for two years of the Covid 19 pandemic and the state’s economy is still slow to recover, these contractors should be given a second chance.

“To blacklist them at this time will have a far-reaching adverse effect on the state’s economy as a whole, further slowing down our recovery,” he said. – May 25, 2022.