Asia

The recent US bombing of Iran’s three nuclear facilities & its’ impact on the Asian / Middle East construction industry still has to be fully analyzed. Construction costs & the material supply chain could be seriously affected; additionally crude oil price could increase by 20% or more.

China & India continue to be the largest and most active construction markets in Asia. China is slowing down to some extent and India is continuing its’ strong and consistent pace. 

The Chinese real estate & construction sector continues to face challenges. The Chinese commercial & housing sector is just about on “life-support” – this problem commenced 2 years ago, and so did the pace of homebuying which is trending significantly downwards. Issues include rising consumer debt and a lack of demand for new housing / apartment units / commercial property. The enduring downward decline in the housing market is a harbinger of major problem ahead. There is total oversupply of commercial & housing units. Anyone visiting China will notice numerous unfinished / abandoned or vacant hi-rise apartment buildings & a preponderance idle construction equipment / high rise cranes not being utilized. Less than 5 years back, China’s real estate development / housing market constituted 20% to 25% of the overall Chinese economy.

India currently is experiencing a “golden” period; India is one of the world’s fastest growing economies. India’s construction sector is making significant headway, a visitor to India will see significant construction activity (roads, bridges, factories & new building) in just about all of India’s 28 states & 8 unions.

The Indian economy is one of the fastest growing out of the world’s major countries. Assisted by government initiatives / investment programs, major Fortune 500 consumer goods investments & new technology such data centers. India’s construction industry is forecast to experience dynamic growth in the next 12 months. India is coming on strong, doing extremely well. India has overtaken China in as the world’s most populated country in 2024, with a population of 1.45 billion. 

India & China are serious rivals, both countries have stationed a significant number of troops on the disputed border region that could turn out to be a “ticking timebomb” now and in the future.

The Indian construction industry is forecast to be in the $0.75 to $0.85 trillion range by the end of 2025. Construction is close to 11.5% of India’s GDP and one of India’s top 3 industries. The Indian construction market is forecast to be a $1.25 to $1.30 Trillion market by the year 2030.

India’s construction industry has played an important role in India’s increasing world status and economic growth. The Indian construction sector is a huge employer, employing 10’s of millions of construction workers. Look for this growth to continue in 2025 and beyond. India’s infrastructure sector is primed for significant growth, infrastructure projects related to roads, bridges, ports and the like are in the planning pipeline and forecast to cost more than $500 billion and are expected to be completed in the next 24 to 36 months.

Ten to fifteen years back, the majority of major US & European industrial / manufacturing companies were directing their CAPEX capital investments into China. However, with all the recent political posturing, territorial disputes & COVID related shutdown issues, China has experienced a slowdown in foreign capital investment. We are seeing more US, Japanese & Western European capital investment moving into India & to a smaller extent into Vietnam. India is now viewed as the place to build new manufacturing / production facilities. 

Japan’s construction industry for the seventh year continues to experience slow or minimal growth in its’ civil / infrastructure, home building, commercial, institutional and industrial sectors, perhaps mirroring Japan’s steadily declining & ageing population. The Japanese construction sector is estimated to be $600 to $750 billion in 2025 or close to 8% of the country’s GDP.

Indonesia is the largest S.E. Asia nation with a population of 280 million & located on 100’s of islands. Indonesia has sizable O&G, timber & mineral resources. The future looks bright for the Indonesian construction sector. 

In the last 5 years, South Korea has strengthened its standing as a as a leader in technology, micro-chips, ship building & FPSO construction.

Some of the smaller Asian nations such as Bangladesh, Malaysia, Sri Lanka, Indonesia, Singapore, Pakistan, Philippines, Thailand, Vietnam and Laos in 2025, have a huge need for new highways, bridges, railroads and other transport and power / industrial related projects.