Middle East to be among fastest-growing regions as worldwide output touches $12.9tr
The global construction industry is expected to rise to $12.9tr in real value terms by the year 2022, expanding by an average of 3.6% per year from 2018 until then, with the Middle East region leading the growth, according to a report by the worldwide data and analytics company GlobalData.
In its latest report, ‘Global Construction Outlook to 2022: Q3 2018 Update’, the company reveals that construction output will go up worldwide from its 2017 level of $10.8tr, with certain regions registering faster growth than others.
Danny Richards, construction lead analyist at GlobalData, said: “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 Middle East and Africa region as a whole will be the fastest with an annual average growth of 6.4% from 2018 to 2022. The report said that the GCC countries, which have suffered from the weakness in oil prices greatly reducing government revenues in recent years, are expected to see a return to growth. As oil prices pick up, large-scale investment in infrastructure projects – mostly related to transport – will be a key driving force behind the construction growth in the region, the report added.
Globally, the pace of 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, said the report, which calculates
The Asia-Pacific region will continue to account for the largest share of the global construction industry, but its growth pace will slow down owing to a 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.
The report added that 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 risks in the face of uncertainty over Brexit.
“While 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,’ Richards added.