Importance of construction and infrastructure in economic development and growth

Importance of construction and infrastructure in economic development and growth

A. Construction (Role or Function)

1. Construction is the powerful tool in economic development of the country as shelter and transportation are the things every human being deals with.

2. Contraction is a major industry throughout the world accounting for a gross domestic product and gross national product

3. The construction industry makes a vital contribution to the competiveness and prosperity of the economy

4. Construction is the labour intensive, when the sector is working at full capacity, large section of the country’s work force are active

5. Roads that have been paved in rural areas linking them to cities have boosted trade in agricultural products as the cost of transportation of agricultural products have gone down

6. As an investment sector, construction has the potential to impact positively on short run growth

7. As the economic development programme of the country has embraced public private partnership, the construction industry could cement its backbone position in national development if it takes a crucial role in the provision of infrastructure that can support the initiative.

8. As an investment sector, construction has the potential to impact positively on short run growth

9. Construction sector plays a powerful role in economic growth, in addition to producing the structure that add to productivity and quality of life of the country

10. Considering the fundamental significance of the construction sector in employment creation, capital formation and its aggregate drop over effects, it is clearly an important sector in the economy

B. Infrastructure (Role or Function)

1. Infrastructure represents those types of capital goods that serve the activities of many industries included paved roads, railroads, seaport, communication network, financial system, and energy supplies that all support production and marketing for industries within the countries.

2. The performance of infrastructure is largely a reflection of the performance of the economy. It provides services that are part of the consumption bundle of residents. Large-scale expenditures for public work increase aggregate demand and provide short run stimulus to the economy.

3. Infrastructure development is a vital component in encouraging a country’s economy growth. Developing infrastructure enhances the countries productivity consequently making a firm more competitive and boosting a region’s economy

4. Not only does the infrastructure in itself enhances the efficiency of production, transportation and communication, but it also helps provide economic incentives to public and private sector participant

5. The accessibility and equality of infrastructure in a region help shape domestic firm investment decision and determine the regions attractiveness to foreign investment

6. The provision of economic infrastructure can expand the productive capacity of the economy by increasing the quantity and quality of such infrastructure