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1 Message from the Prime Minister, Master Plan of Malaysia Construction Industry 2006 - 2015
2 Master Plan of Malaysia Construction Industry 2006 - 2015, p.11
3 Message from the Minister of Works, Master Plan of Malaysia Construction Industry 2006 - 2015
4 "Programme on Strengthening Bumiputera Renovation Contractors Conference" through the CIDB National Accredited
Renovators (CNAR), that was officiated by Works Minister Datuk Seri Fadillah Yusof (http://1gst.com.my/1gst-news/179-gst-
to-have-minimal-impact-on-renovation-construction-sector.html)
The Real Estate and Housing Developers Association (REHDA) said the impending Goods and
Service Tax (GST) will impact the local construction industry, especially on the joint venture (JV)
developments between landowners and developers.
Datuk Ng Seing Liong, REHDA’s immediate past president and chairman of REHDA’s task
force on accounting and taxation, said once the GST is implemented, the land owners are expected to start
charging six per cent to the developers.
“This six per cent is for construction cost service and landowner is not supposed to be involved
in development. Now the government wants landowners to charge developers six per cent GST because
they claim developers are providing construction service. Developers now pay high land cost to build
houses. With the GST, they have to pay additional six per cent to the landowner as they own the land,”
Ng said.5
Now, we can see that developing impact, between GST and Construction Industry in Malaysia
give weight each other, more supporting from government and developing of infrastructure outside of the
city with GST in Malaysia.
Construction industry has an obligation and a responsibility to ensure that development taking
place today and pursuit of wealth today of the quality of life in the future. Understanding the importance
of the stake holder role in construction industry, there is the institution of construction developing that has
a strategic in construction of infrastructure in Malaysia, especially for contractors.
The institution is The Construction Industry Development Board (CIDB) of Malaysia, was
established under the ACT 520 (Lembaga Pembangunan Industri Pembinaan Malaysia/ LPIPM) on 24th
July 1994, as the governing body entrusted with the responsibility to provide effective leadership and
coordination to industry’s players, in Malaysia. The CIDB is a statutory body under the Ministry of
Works, Malaysia, and has been given the authority to lead and develop the construction works, value for
money, and responsive to consumers’ sentiment over construction performance (CIDB, 2007).
In CIDB, it has been made mandatory for all local and foreign contractors to be registered in one
of the seven grades of registration before undertaking their business operation in Malaysia. In the year
2000, CIDB introduced the ISO 9000 QMS (Quality Management Systems). Due to the grades based on
5 Datuk Ng Seing Liong (August 2014), The Real Estate and Housing Developers Association (REHDA) immediate past president
and chairman, GST Will Impact Local Construction Industry, Building Materials Distributors Association of Malaysia (BMDAM)
(http://www.bmdam.org.my/v2/news_details.php?news_id=100&btn=news_events)
financial categories6, from the smallest financial G1 ( ˂ 200,000 MYR ) to the largest financial G7 ( ˃
10,000,000 MYR ) categories contractors.
Malaysia has the Presidents and Chief Executive Officers (CEO) of the contractors and the master
builders, who jointly organized in Building Industry President Council (BIPC) of Malaysia. Hence, on
June 24th 2003, CIDB and BIPC were organizing a roundtable on “Establishing Priorities to Improve the
Malaysian Construction Industry for the Future”. The event was participated by CEOs of major
construction and property development companies, presidents of professional institutes and building
industry associations, as well as officers from various government departments. The roundtable identified
and recommended measures to improve the construction industry in Malaysia, with the role of
coordinating on recommended and 10 identified Working Groups (WGs) in : 7
Then, CIDB and BIPC consolidated those issues for each WGs to proposed and produced to be
the first draft of consolidated of Master Plan, is the “Malaysian CIMP (Construction Industry Master
Plan) Framework 2005 – 2015”. Then, CIMP as a structure is organized into six sections to ensure that
the construction industry is well positioned to support the nation’s overall economic growth and to meet
various challenges, such as the need to enhance productivity and quality along the entire construction
industry value chain.
6Buku Keperluan dan Prosedur Pendaftaran Kontraktor, CIDB Malaysia, cetakan Mac 2015, p.35
7Master Plan of Malaysia Construction Industry 2006 - 2015, p.3-5
8 Master Plan of Malaysia Construction Industry 2006 - 2015, executive summary, Strategic Direction of The Malaysian
Quality in the construction industry will have to encompass more than contractors alone.
Architects and engineers will have to be involved as well since for of the three contributing factors to the
quality failures ( material faults, construction faults and design faults ), 50% of the failures can be
attributed to design faults, while 40% are due to construction faults, and only 10% are because of material
faults.10
The endorsement of CIDB dan BIPC roundtable on June 24th 2003, with Working Groups (WGs)
on 10 identifications toward as the beginning of construction industry frame work in Malaysia. A few of
strategic direction makes in vision, mission and critical success factors are as followed, seven thrusts have
been developed and keys of performance to be succeeded to the overall CIMP that has been set up. The
recommendation, has been developed to address key issues identified below :11
10 Master Plan of Malaysia Construction Industry 2006 - 2015, CIDB Working Groups on Productivity and Quality, p.4 and p.47
11 Master Plan of Malaysia Construction Industry 2006 - 2015, executive summary, Strategic Recommendations, p.12
ST3 : Strive for the highest standard of quality, 3.1 Foster a quality and environment-friendly culture
occupational safety and health, and environmental 3.2 Enhance occupational safety and health
practices 3.3 Adopt Malaysian Standard (MS) in the manufacture or
import of building and construction materials
ST4 : Develop human resource capabilities and capacities 4.1 Enhance and enforce the use of skilled labour (building
in construction industry capability)
4.2 Nurture the desire to work in the construction industry
amongst the local workforce (building capacity)
ST5 : Innovate through research and development and 5.1 Continuously innovate construction processes and
adopt new construction methods techniques
5.2 Stimulate R&D activities through resource-pooling initiative
amongst key players and provision of R&D infrastructure
ST6 : Leverage on ICT in the construction industry 5.1 Encourage knowledge sharing for continuous improvement
5.2 Develop local construction software industry
7.1 Ensure industry sustainability in the liberalized environment
ST7 : Benefit from globalization including the export of 7.2 Market the construction industry in a focused, global
construction products and services manner
7.3 Ensure the financial services sector’s development is in line
with industry’s needs
7.4 Develop complementary industries
1.0 Review and amend the tax, legal, and regulatory frame
Enabling Recommendations work
2.0 Redefine the structure and the role of CIDB
3.0 Reinforce Bumiputera entrepreneurs’ capabilities and
equitable share in the construction value chain
The table above based on a roadmap strategic in the developing of construction industry in
Malaysia decade 2006 – 2015. Hence, not only this frame work of CIMP will be recommended and
established for improving Malaysia in the future, but also to make a significant contribution to the
nation’s aspirations and the welfare of Malaysian people in a decade.
Those inputs are then divided into its elements and the activities to be implemented for each
element were then identified and included into the time span of the roadmap in order to achieve the
mission within stipulated time frame in 2006 – 2015.
The strategies and the action plans of CIMP, need to be implemented using approach covering
within 10 years period from 2006 to 2015. This has been adopted into the growth in capabilities
construction industry of Malaysia. Implementation of the strategies address to be a roadmap of
construction industry in Malaysia, and they are divided in 3 phases :
12 Master Plan of Malaysia Construction Industry 2006 - 2015, executive summary, Implementation Framework and Plan, p.58-
63.
2. Phase 2 : (2009 – 2012) Further strengthen existing capabilities in all key areas to compete
effectively with global peers.
This 2nd phase will focus to develop new capabilities and to build a strong foundation for
industry to venture overseas. This is a strategy for competing effectively with its peers in the
global marketplace.
3. Phase 3 : (2013 – 2016) Increase presence and enhance stature in the global construction
arena.
The long term plans in this 3rd phase will be a fulfillment of the vision to be a world-class,
innovative, and knowledgeable global solution provider, to establish a secured footprint for
the construction industry in global construction marketplace.
13 Master Plan of Malaysia Construction Industry 2006 - 2015, executive summary, Implementation Framework and Plan, p.63.
CABINET COMMITTEE
ON INVESTEMENT &
INFRASTRUCTURE
DEVELOPMENT
MONITORING &
MOW ASSESSMENT
CIDB
CIDB BOARD
Secretariat
CIMP WORKING
COMMITTEE
IMPLEMENTATION
TECHNICAL
WORKGROUPS
DISCUSSIONS
Construction industry in Malaysia, has been developed in the last decade from 2006 to 2015.
From focus as a new strengths and capabilities which perpetuate inefficiency and low growth rates in
construction industry, focus to develop new capabilities and to build strong foundation to venture
overseas to be a world-class, innovative, and knowledgeable global solution provider, achieve to establish
a secured footprint in global construction marketplace.
GST is one of programs from government that involved into Malaysian infrastructure
development, to increase of the development quality starting from GST. In a decade of CIMP roadmap,
actually seemed that Malaysia has been implemented all the programs. Hence, all stakeholder have owned
the results of monitoring, reviewing and updating accordingly by CIDB to ensure its relevance and
applicability. In order to results and variances in performance will be analyzed and highlighted to the
relevant stakeholders nowadays to develop the construction industry of the future in Malaysia.
REFFERENCES
Buku Keperluan dan Prosedur Pendaftaran Kontraktor, CIDB Malaysia, cetakan Mac 2015, Malaysia.
Construction Industry Master Plan (CIMP) Malaysia 2006 – 2015, Executive Summary, first printing
2007, ISBN 978-983-2724-44-5, Kuala Lumpur, Malaysia.
Construction Industry Master Plan (CIMP) Malaysia 2006 – 2015, first printing 2007, ISBN 978-983-
2724-44-5, Kuala Lumpur, Malaysia.
Datuk Ng Seing Liong (August 2014) GST Will Impact Local Construction Industry, The Real Estate .
and Housing Developers Association (REHDA) immediate past president and chairman, Building
Materials Distributors Association of Malaysia (BMDAM), Malaysia.
(http://www.bmdam.org.my/v2/news_details.php?news_id=100&btn=news_events)
Dato Seri Najib Tun Razak, Prime Minister (2015) Pastikan Cukai Barangan dan Perkhidmatan Tidak
Bebankan Rakyat, Jaminan Perdana Menteri, UTUSAN MALAYSIA, Pemangkin Fikiran
Rakyat, bil : 77 Tahun 51, Selasa 310315, 10 Jamadil Akhir 1436, Malaysia.
(www.utusan.co.my)
Datuk Seri Fadillah Yusof, Works Minister (Dec 2014) GST to Have Minimal Impact on Renovation
Construction Sector : in “Programme on Strengthening Bumiputera Renovation Contractors
Conference" through the CIDB National Accredited Renovators (CNAR), Works Ministry of
Malaysia, Malaysia.
(http://1gst.com.my/1gst-news/179-gst-to-have-minimal-impact-on-renovation-construction-
sector.html)
iProperty.com (August 2014) GST Will Impact Local Construction Industry, Malaysia’s no1 Property
Website, Malaysia.
(http://www.iproperty.com.my/news/9104/gst-will-impact-local-construction-industry)
Jonkers, Frans (June 1999) Malaysia 1999 : Country Forecast Report with Forecast Through end-2001,
published by Business Monitor International Ltd, June 1999, chapter 6 : Key Economic Sectors
(p.103-128) ISSN 0267-8195, Malaysia.
Zuhairi, A.H., Kamar, KAM., Zain, M.Z.M., Ghani, M.K., and Rahim, A.H.A. (2008) Industrialized
Building Systems (IBSs) in Malaysia : The Current State and R&D Initiatives, Malaysian
Construction Research Journal (MCRJ) vol. 2 no. 1, ISSN 1985-3807, CREAM – CIDB
Malaysia, Malaysia.