Emerging nations to boost global construction output
China is set to overtake the US as the top construction market by 2018
November 13, 2009
By Lorraine Turner London
Global construction output will recover to grow 70 percent by 2020, powered by emerging nations like China and India, according to a new report published yesterday.
China is set to overtake the US as the largest construction market by 2018, in spite of the US economy showing its first signs of growth in more than a year, and North America is set to be the highest-growth region in construction amongst developed countries.
The global construction market is estimated to be worth $12.7 trillion (R94.5 trillion) by 2020, with emerging countries - particularly in Asia - dominating output and more than doubling their share of the market to $7 trillion.
This comes after one of the sharpest downturns in the sector in the wake of recession. Output has plummeted $650 billion a year since 2007 in developed countries.
"The recent slump in the global economy has been exceptionally severe and construction has been hit more severely than most industries," says the report, entitled Global Construction 2020, by Global Construction Perspectives and Oxford Economics.
However, the dark clouds were starting to lift as a global economic recovery could emerge as early as this year, the head of the International Monetary Fund, Dominique Strauss-Kahn, said last month. This optimism is echoed by recent company updates.
Holcim, the world's second-largest cement maker, reported forecast-beating quarterly profit on Wednesday, and highlighted strong demand in Asia Pacific, offsetting a gloomier picture for Europe.
The recovery in construction, estimated to account for 15 percent of world output by 2020, will largely be driven by emerging nations that have strong population growth and infrastructure needs.
Spend on transport, utilities and buildings is estimated to rise 128 percent, with countries such as Brazil and South Africa benefiting from hosting sporting events such as the World Cup and the Olympic Games.
In spite of slower growth than emerging nations, construction will rise 35 percent to $5.7 trillion in developed countries by the end of the decade. Western Europe, however, will suffer the longest as one of the lowest-growth regions in construction. - Reuters
|
|
