How will develop the Eastern-European construction market in 2016?
For the first time, EECFA could present its new forecast at the 80th EUROCONSTRUCT Conference which was organized by Buildecon, the central body and research centre of EECFA in December 2015.
In EECFA area the outlook for the total market remained almost unchanged for 2016, -1.5%, but our forecast for building construction is less pessimistic than half a year ago. Russia is contributing most to the negative expectation, and no further expansion is foreseen in Turkey in the next year. The Eastern and Western Balkan countries' development path in building construction is quite similar and the outlook for these countries is positive.
In the 4 EU member countries (Bulgaria, Croatia, Romania and Slovenia) construction seems to be bottoming out with growth recurring in 2017. There are two development patterns. First, in Romania and Croatia - already in 2015 - total construction output is estimated to record a growth and continue to increase substantially in 2016 and 2017. Second, Bulgaria and Slovenia are set to see a decrease in construction output growth this year, with further drop in 2016, but in both countries a big hike should follow in 2017. Growth is also coming back to the EU candidate Serbia with positive rates in construction in 2015 followed by expansion in 2016 and 2017 as well.
Construction markets outside the EU (Russia, Turkey, Ukraine) are all projected to have witnessed negative growth rates this year (-5.2%, -1.4%, -13.8%, respectively). In Russia the reason was the drastic slump in all building segments caused by the worsening external-economic environment, decreasing oil prices and western sanctions. Turkey has also seen a backdrop in both non-residential and civil engineering and residential could not grow too much due to the political uncertainties. The bad performance in Ukraine derives from drops in non-residential and civil-engineering affected by the shocks in the economy, the high budgetary debt, investment deficit and the forced militarization. In 2016, only Ukraine will be positive in terms of growth projections, both Turkey and Russia foresees a decrease, but growth should return in 2017 in all three construction markets.
Autor: Buildecon, EECFA Central, www.eecfa.com, info@eecfa.com
Source of data: 2015 Winter EECFA Forecast Reports, EUROCONSTRUCT 2015 Winter Reports.
