13 th Pacific Association of Quantity Surveyors Congress (PAQS 2009) 1 A PRELIMINARY STUDY OF ECONOMICS; THE SURVIVAL STRATEGIES EMPLOYED BY THE MAJOR CONTRACTORS IN MALAYSIA DURING THE ASIAN FINANCIAL CRISIS Hafizah Mohd Latif 1 , Dzulkarnaen Ismail 1 and Syed Abdul Haris Syed Mustapa 2 1 Lecturer of Building Department and 1 Department of Quantity Surveying 2 , Faculty of Architecture, Planning and Surveying, Universiti Teknologi MARA, Sri Iskandar Campus, 32610 Bandar Baru Sri Iskandar, Perak Darul Ridzuan, Malaysia. fiezalatif@gmail.com ABSTRACT It is clear that the 1997 economic crisis has given a great crash to the performance of Malaysian economy. Realizing the pressure facing the industry, the question on ‘how the local construction firms can survive’ particularly those which are listed on KLSE have been explored. The most fundamental method of the research is the historiography particularly in evaluating the information from the case studies. Four companies were selected as case studies. It was found that the most accepted strategies during the crisis are (1) diversified in other businesses, (2) secured domestic projects by coping in line with the Government’s policy and allocation, especially in infrastructure and housing sectors (3) to secure project(s) in other countries, (4) reduce cost by effective resource management and (5) to complete the project earlier then the targeted completion date. Keywords: Contractors, Financial Crisis, Strategies 1. INTRODUCTION Malaysia has experienced several economy crises. As of Malaysia’s history, it was observed by the economist that the distance of every crisis in Malaysia was about 10 years. It is now year 2009 and again Malaysia (as well as other countries) facing with the economic slowdown (Global Financial Crisis). It is therefore prudent for the industry to gain knowledge from the past experience as to go through the tough situation and to be more preemptive to battle any possible shocking events. This study conducted based on a descriptive research paradigm. Characteristically, under this approach, the whole framework of the research is of the historical-narrative which uses a narrative to examine and analyze the sequence of strategies utilized by the contractors. Analysis of documents and materials (to evaluate historical or contemporary confidential or public records, public feedbacks on the internet and report) were carried out. Interviews with experience construction personnel were further carried out to get more data and to reveal any hidden issues. As the scope of study, the research has selected construction companies on Main Board of KLSE. The main reason why the researcher only concentrated on Main Board listed companies because it was easier to recognize the strategies of larger companies. Also, the annual report and banks report were more accessible to the researcher besides providing a major source of information. The listed companies were the most suffered from the financial crisis due to the sharp declined in KLSE and the loss of confidence of the investors. A list of construction companies was obtained from KLSE files. To select the most reasonable construction companies as case studies, the researcher has narrowed down the companies by referring to the top-ten list of the construction sector from year 1996 to 1999 as tabulated below.