Asia

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 smaller extent into Vietnam. India is now viewed now as the place to build new manufacturing / production facilities.

The Asian construction sector forecast for 2026 indicates a more optimistic improvement from 2025, estimated growth projected approximately 3.8% after a somewhat lackluster 2025. Construction activity in Asia will be driven by Government funded roads, bridges, high speed rail projects.

China’s economic slowdown will continue in 2026, which of course will impact China’s construction sector. China’s oversupply of housing / commercial property glut remains a big problem, that will be a drag on for possibly another 2 or 3 years.

The Chinese construction industry in 2026 is fueled by Civil / Infrastructure domestic projects. A number of Chinese EPC companies are actively chasing overseas opportunities – projects like railroads, highways & ports, primarily focused on Africa & Asia. The Chinese real estate & construction sector continues to face challenges.

The Chinese commercial & housing sector is just about on “life-support” this problem commenced 3 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 a total oversupply of commercial & housing units. Anyone visiting China will notice numerous unfinished / abandoned or vacant hi-rise apartment buildings & a preponderance of 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.

The Indian Government is pumping billion of Rupees into Infrastructure / Hi-Speed Rail and Power related projects, look for this to continue in 2026 and beyond. India can boast of one of the world’s most dynamic growth countries, the construction sector is on a sustained growth streak.  

India’s construction & engineering sector offers numerous infrastructure (highways, ports, & bridge) type projects. India has plans to build at least 5 to 7 new nuclear power plants in the next 5 years. These projects are focused on providing the industrial base that India needs to grow now & in the future. India is currently 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 2026, 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.

Other Asian countries such as South Korea, Malaya, Singapore, Taiwan, Vietnam and Indonesia appear to be set for constriction related growth in 2026, assuming no major conflicts or economic event take place in the next 12 months.

Japan’s construction industry (for the seventh year in a row) 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 2026, 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.