Georgetown has seen a boom in the construction sector in recent years. This boom has inevitably led to dramatic changes in the city’s urban development, transforming sections of the old colonial landscape into a modern hub of multi-use buildings. Investments in the real estate sector have also been increased in various parts of the country at the same time that the Government decided to expand its housing drive. This drive has been given greater impetus by the cheap prices for local and foreign building materials.
When the Government decided to develop large tracts of land for housing purposes, and made it easier for every Guyanese to have their own home, the demand for construction materials and other goods and services increased. This enabled local companies from the manufacturing, services, distribution and financial sectors to capitalise on the opportunities that were created. Financial institutions are seeing increases in their businesses. Major commercial banks are also fuelling the boom by providing more financing to home owners and potential homeowners. Even the state is able to capitalise on the boom. New developments in the real estate sector are paving the way for other infrastructural projects, such as the construction of new roads, and the expansion of old ones, to enable easier transportation and alleviate traffic congestion.
As we have previously said, home ownership also has other immediate spinoff benefits, as owners seek to furnish and constantly upgrade their properties. Businesses that cater to this trade typically employ a large number of unskilled persons, as well as give a boost to local manufacturers of furniture and other household goods. The NDCs can now collect rates and taxes to provide various services to the area.
But just as important are the social benefits that give families a sense of stability and security. The moment someone owns a home, the family acquires pride in home ownership, and typically sees itself as having a stake in the community. This leads to the development of social capital in the form of trust between residents. If countries do not have this kind of social capital, it is almost impossible for them to mobilise their citizens for the sacrifices a sustainable developmental thrust demands.
The success of a developing country depends on the development of a growing middle class. There can be no middle class, unless they are facilitated to own their own homes.
It seems all exciting, especially since economic boom is spurred by a building boom. But the excitement could result in the authorities overlooking some negative issues that also accompany a construction boom. Authorities must pay keen attention to these issues.
One of Guyana’s major challenges is urban and rural flooding. That is mainly because the country is flood-prone. Some 90 per cent of the Guyanese population is at risk from contemporary flood hazards. Georgetown, especially, floods quite easily. This has raised questions on the wisdom of encouraging greater construction in the city. While households and businesses could incorporate flood-protection measures during construction, they would not have considered sea level rises, which make coastal zones particularly vulnerable to climate variability and change. This raises concerns about land loss, flooding, and responses to sea level rises.
Authorities also need to consider that a construction boom exerts pressure on the water and electricity companies. The demand for water and electricity services is increasing proportionately. However, the Guyana Power and Light is presently unable to meet customers’ demands for a reliable supply of electricity. This has resulted in some communities having to wait for long periods before accessing electricity, while those that are already connected to the company’s system are receiving an unreliable supply of the commodity. The Guyana Water Inc is similarly challenged.
In fact, when new housing developments are created, both of these companies are challenged to provide services to new consumers without affecting the service offered to current customers. It means, therefore, that the utility companies would have to make large investments quickly to keep up with the boom.
