KOTA KINABALU: The temporary ban on the export of scrap iron by the Sabah Government on Friday is timely.
Sabah Builders Association (SBA) president Henry Tsen, in welcoming the decision announced by Sabah Chief Minister Datuk Seri Hajiji Noor on Friday, said the recent price hikes had caused the price of houses in the state to increase.
"The ban will result in sufficient raw material supply for the steel industry.
"SBA hopes to see an increase in production of local mills and looks forward to a drop in the price of rebar (reinforcing bars) soon," said Tsen.
For decades, he added the prices of major construction material like steel rebar and cement had always been significantly higher than that in West Malaysia.
"This explains why Sabah houses are always more costly. Hopefully this scenario will start to change with this action taken by the state government," said Tsen.
SBA believes the state government's objective is to reduce the high price of houses especially affordable housing, he said.
SBA praised the Chief Minister for listening to the voices and predicament of housing developers and steel industry players.
Sabah United Chinese Chamber of Commerce (SUCCC) president Tan Sri Andrew Liew Sui Fatt also welcomed the decision and described it as a practical move.
He said the decision helped to make sure the state's steel industry has sufficient supply of raw material and stabilised the market to prevent a shortage in the supply chain.
The move taken by the Chief Minister will ensure the survival of the local steel industry and other related businesses in the state under the new norm of economic environment, said Liew who is also the Associated Chinese Chambers of Commerce and Industry of Malaysia (ACCCIM) vice- president.
Hajiji in his announcement stated that the steel industry contributes significantly to Sabah's economy and is providing 500 jobs with an average monthly wage of RM2,000 per worker.
The chief minister had also said if the steel industry ceased operations, the state's unemployment rate would rise and create a negative impact to the state's economy during the trying times of the Covid-19 pandemic.