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Creation Date: Fri, 13 Nov 2009 GMT

China construction to overtake US in 2018

Report predicts reshuffle of global markets will also favour Nigeria, India and Poland

China will overtake the US to become the world's largest construction market in 2018, a new report has predicted. The report launched today forecasts global construction trends over the next 10 years. Its key predictions include Nigeria becoming the world's fastest growing construction market by 2020, followed by India and then Poland. China will be the largest market by 2020, the research found, with the US being the second largest, followed by India.

The Global Construction 2020 report found that Nigeria's construction spending will grow by at least 9% every year over the next decade, driven by rapid urbanisation. China's construction market will be worth almost £2.5 trillion in 2020 and will represent an immense 19% of global construction output.

A spokesman for Oxford Economics, which produced the report, said: "Overall the report shows that over the next 10 years the busiest markets will be in emerging economies and the emphasis will be on infrastructure."New world orders: Construction's latest global hotspots
13 November 2009

By Emily Wright

A startling report is forecasting a big shift in the world demand for construction by 2020. So dig out the guide books and maps for Nigeria, India and eastern Europe

You probably have a good idea of which countries have the largest demand for construction services right now, but it probably doesn't bear much resemblence to what you expected back in 1998, before the Dubai boom really began, most of the east Asian tiger economies had been crushed by a financial landslide and nobody really thought India was going to be a major player anytime soon ... which prompts the obvious question: what will the world look like in 2020?

According to Global Construction 2020, a report by economic consultancies Global Construction Perspectives and Oxford Economics, it's going to look pretty unfamiliar. For one thing, the Chinese construction market it expected to overtake the US by 2018, India is going to overtake Japan to become the third biggest market and Nigeria is going to be booming.

The report looks at 35 countries and tries to predict their growth rates over the next 10 years based on their demographics, their need for infrastructure and housing, and their wealth. So, Nigeria is at the top of the emerging market list because its population is urbanising faster than any other country in the world, its 150 million people are desperately in need of decent infrastructure, it has oil - and at the moment it spends a mere 3.2% of its GDP on construction.

But perhaps the best news is that, according to the authors, the world's construction market is heading for a period of rapid growth. The report says the recession took £390bn out of worldwide output, leaving the global market at something like £4.5 trillion global market, equating to 13.4% of world GDP, but estimates that by 2020 output will have grown 70% to $7.5 trillion and will make up 14.6% of world output. Developing markets such as Nigeria, India, China and Russia, which are predicted to grow 110% over the next decade, will make up £4.2 trillion of this. "Construction in 2020 in emerging markets will be 17.2% of GDP in emerging markets," says Graham Robinson from Global Construction Perspectives.

The UAE is notable only by its scarce coverage. There are no statistics on Qatar, Oman or Kuwait, which the report's writers say is due to the fact that, despite being oil and gas rich, in terms of their construction markets they do not offer long-term opportunities.

"The current downturn in the UAE has realised significant concerns. Property values have dropped and a high proportion of residential property remains empty," says Robinson. "We expect that output will take some time to rebound and the problem in the commercial sector could be even worse."

The report forecasts that overall growth in the UAE's construction market will be 70% over the next decade and that by 2020 it will be just 4% the size of China's.