The Australian construction industry is in for a major shock as Bensons Property Group (BPG), one of the country's leading construction groups, has declared bankruptcy.
One of Bensons Property Group's projects, a 485 million AUD apartment building on the Gold Coast of Queensland - Photo: dailymail.co.uk
The collapse of the giant business has left more than 1,300 homes worth a total of $1.5 billion unfinished in the states of Victoria, Queensland and Tasmania.
This not only causes difficulties for home buyers but also raises serious concerns about instability in the Australian construction industry, while creating negative impacts that spread to many sectors of the country's economy.
BPG's bankruptcy decision comes as the construction industry is under severe pressure from rising material costs, disruptions to global supply chains due to the COVID-19 pandemic and rising home loan interest rates.
CEO Rick Curtis stressed that the decision was “extremely difficult but inevitable” to protect the interests of customers, employees and stakeholders.
However, declaring bankruptcy does not stop at leaving behind unfinished houses or projects, but also causes a chain effect, deeply affecting many areas directly and indirectly related to the construction industry.
Australia's construction crisis has caused severe disruption to the country's property market, with a series of housing projects on hold indefinitely.
Many homebuyers, especially young families, are facing the risk of significant financial losses, and are even under additional pressure to find funding to complete unfinished homes themselves. This has severely undermined people’s confidence in the real estate market, which is already under pressure from rising house prices and limited supply.
Housing shortages in major cities such as Sydney, Melbourne and Brisbane have exacerbated the problem, pushing up property prices and putting pressure on demand for social housing.
Not only the real estate market, Australian supply chains and construction contractors are also seriously affected.
Suppliers of building materials such as steel, cement and timber are facing a significant drop in orders, forcing many businesses to scale back operations or even close. Thousands of construction workers and subcontractors have lost their jobs, leading to a drop in household incomes and a reduction in purchasing power in the economy.
The domino effect not only severely affects the construction industry but also spreads to the retail, service and consumer sectors, putting great pressure on the labor market and social security systems.
The financial system is also facing significant risks from the crisis. Banks and financial institutions that have provided credit for large construction projects now face the risk of increased bad debt.
This not only reduces future lending capacity but also stagnates capital flows into new projects, slowing economic growth.
These consequences require the Australian Government to intervene to support the construction industry through this difficult period, while also posing major challenges in balancing the national budget.
Big challenges for the Australian economy
The construction crisis has exposed fundamental weaknesses in Australia’s economic system. Disruptions to construction projects have not only undermined investor confidence, especially at a time when demand for housing in major cities is high.
Without timely improvement measures, this instability could persist, reducing investment flows and affecting the prospects of economic recovery after the pandemic.
To address this, the Australian Government needs to work closely with businesses, banks and financial institutions to develop comprehensive solutions. Supporting the completion of unfinished projects and protecting the interests of home buyers must be a top priority.
At the same time, reform policies in construction industry management, including financial supervision and consumer protection, need to be strongly implemented to ensure the sustainability of the construction industry in the future.
What is happening is not just a problem for the construction industry but has become a major challenge for the Australian economy. In this context, the balance between short-term support and long-term development will be the decisive factor in mitigating the negative impacts and rebuilding confidence in the market.
Without timely action, the fallout from the current crisis could leave a lasting negative mark on Australia's economy and society.
Source: https://tuoitre.vn/nganh-xay-dung-uc-soc-manh-khi-tap-doan-hang-dau-tuyen-bo-pha-san-20241228125216343.htm
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