Gloomy global construction forecast

According to an article posted by ARI, sustained worldwide economic recession is making itself felt everywhere, including global construction markets. Economic forecasting company Global Insight says that global construction growth is expected to dip by under +2 percent in 2009. The growth figures are expected to be the lowest since 2002.

The most severely effected of all is the North American market that will face a contraction of -9 percent, driven by the downturn in the U.S., while Western Europe will fare a little better with almost no growth. On the other hand, Eastern Europe may face a slight setback in terms of growth but will manage to stay in the positive territory. France and Europe may escape unscathed, but Spain and UK may be scalded with possible downturns in growth. Asia may still offer growth, despite a downturn in its export markets.

Global Insight predicts a bright future for the Middle East and Latin America even though the risk of falling commodity remains a source for concern. Many of the countries in these regions are relying on their foreign currency reserves and fiscal surpluses to cushion the shock of the global recession.

Global Insight expects the best opportunities over the coming years to be in the area of infrastructure construction in emerging markets, since developing economies are expected to continue to invest in infrastructure while their commercial, industrial and residential construction activity suffer a setback.

Recovery for the construction industry may not come before the year 2011. Global Insight director of construction services Scott Hazelton said, " No true recovery for construction markets is expected until 2011. However, the recovery could be steep and the needs of emerging markets remain great. The construction recovery, when it comes, should be strong." Your comment?