The global construction industry is expected to grow by an average of 3.6% a year over the forecast period 2018 to 2022, according to GlobalData, a data and analytics company.
The company’s latest report, ‘Global Construction Outlook to 2022: Q3 2018 Update’ reveals that in real value terms*, global construction output is forecast to rise to $12.9 trillion by 2022, up from $10.8 trillion in 2017.
Danny Richards, Construction Lead Analyist at GlobalData, says, ‘‘We forecast that global construction output growth will accelerate to +3.6% in 2018, up from 3.1% in 2017, reflecting the recovery in the US as well as general improvements across emerging markets. In South and South-East Asia, for example, construction in India has regained growth momentum, while the pick-up in oil prices has supported the recovery in the Middle East and Africa.’’
The pace of global construction growth is set to improve slightly to 3.7% between 2019 and 2020, before easing back in the latter part of the forecast period, reflecting trends in some of the largest markets.
The Asia-Pacific region will continue to account for the largest share of the global construction industry, however the pace of growth will slow given the projected slowdown in China’s construction industry to an average of +4.2% between 2018 and 2022, offset by an acceleration in construction growth in India.
Construction activity is gathering momentum across Western Europe with the region’s output set to expand by 2.4% a year on average from 2018 to 2022. However, expansion in the UK is subject to major downside risks in the face of uncertainty over Brexit.
The Middle East and Africa region as a whole will be the fastest with an annual average growth of 6.4% from 2018 to 2022. Countries in the Gulf Cooperation Council (GCC) have suffered from the weakness in oil prices in recent years, greatly reducing government revenues. As oil prices pick up, however, large-scale investment in infrastructure projects - mostly related to transport - will be a key driving force behind the construction growth in the region.
Richards says, “Whilst there are intensifying downside risks for global construction related to global economic growth, notably stemming from the erupting trade war between the US and China, the global economy will continue to expand in the range of 2.5% to 3% a year from 2018 to 2022 which will support continued construction growth in key markets.’’
* ‘real value terms’ is measured from constant 2017 prices and US$ exchange rates
Related Stories
Market Data | Aug 22, 2018
July architecture firm billings remain positive despite growth slowing
Architecture firms located in the South remain especially strong.
Market Data | Aug 15, 2018
National asking rents for office space rise again
The rise in rental rates marks the 21st consecutive quarterly increase.
Market Data | Aug 13, 2018
First Half 2018 commercial and multifamily construction starts show mixed performance across top metropolitan areas
Gains reported in five of the top ten markets.
Market Data | Aug 10, 2018
Construction material prices inch down in July
Nonresidential construction input prices increased fell 0.3% in July but are up 9.6% year over year.
Market Data | Aug 9, 2018
Projections reveal nonresidential construction spending to grow
AIA releases latest Consensus Construction Forecast.
Market Data | Aug 7, 2018
New supply's impact illustrated in Yardi Matrix national self storage report for July
The metro with the most units under construction and planned as a percent of existing inventory in mid-July was Nashville, Tenn.
Market Data | Aug 3, 2018
U.S. multifamily rents reach new heights in July
Favorable economic conditions produce a sunny summer for the apartment sector.
Market Data | Aug 2, 2018
Nonresidential construction spending dips in June
“The hope is that June’s construction spending setback is merely a statistical aberration,” said ABC Chief Economist Anirban Basu.
Market Data | Aug 1, 2018
U.S. hotel construction pipeline continues moderate growth year-over-year
The hotel construction pipeline has been growing moderately and incrementally each quarter.
Market Data | Jul 30, 2018
Nonresidential fixed investment surges in second quarter
Nonresidential fixed investment represented an especially important element of second quarter strength in the advance estimate.
