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Executive Summary:
Evaluating the Global Construction Industry in 2024 is not an easy task, however a number of experts / economists and Compass international are reasonably bullish on the remainder of 2024 Construction prospects.
Some good news, it appears that the US economy and construction sector will not experience a full blown economic recession as we move further into 2024. The Global energy transition and the move away from fossil fuels will continue to have a major impact on the Global Construction industry now and in the future.
There is a new cold war between China and the USA. China’s tone has become more belligerent in the last 6 to 12 months. This disagreement could be a major problem in 2024 and beyond. The intensifying rivalry between the USA and China looks like it is a permanent challenge to the global economy and construction sector. The chances of a full blown global recession /economic downturn remains reasonably high as we move into the 2nd Q of 2024. On the positive side, the Global Construction sector is showing some signs of growth and is (for the most part) positioned for a recovery from the last 2 to 3 lackluster COVID / supply chain years.
Escalating tensions in the Middle East and the ongoing Russia and Ukraine conflict are potential road blocks to future growth in 2024. The Global Construction Industry is resilient and is forecast to reach $11.5 trillion by the years end in 2024 and to possibly hit $14 trillion by 2026. However, difficult conditions remain in place, the Global Construction industry will continue to face challenges in 2024. The Global Construction industry is expected to grow between 2.8% and 3.5% in the same period. The following is the distribution of the Global Construction market by geographical location:
# | Region | 2024 Value in Trillions $’s |
1 | North America (USA / Canada / Mexico) | 3.06 |
2 | South America | 0.93 |
3 | Western Europe | 2.41 |
4 | Eastern Europe | 0.78 |
5 | Middle East / Africa | 1.29 |
6 | Asia / Australia (China / India / Japan / Australia / New Zealand / Other S.E. Countries) | 3.03 |
Total | 11.50 |
The countries that will experience some of the highest GDP growth in the 2nd Q of 2024 include:
- Guyana, Ethiopia, Senegal, Libya, UAE, Cote d’Ivoire, India and Vietnam.
The vast majority of these countries are large exporters of Oil / Gas, Minerals and Timber products.
The countries that are seeing increased / improved construction activity include Saudi Arabia, India, China (getting back after the COVID shutdowns), Vietnam and some of the smaller SE Asia nations.
For the best part of 3 years, the Global Construction industry has faced the following challenges:
- High inflation rates
- Supply chain issues / interruptions, causing delivery delays
- The shortage of skilled construction labor & sub-contractors especially in the USA & Canada
- High oil & gas prices (gasoline / petrol & diesel cost have increased by as much as 25% in the last 18 months)
- Construction material costs have increased by close to 20% in the last 24 months
- The ongoing Russia – Ukraine conflict has created major problems in Europe & around the world
- Increased tensions in the Middle East after the Hamas attack on Israel and Israel’s response
- In Asia, possible flash points remain in the South China Sea – China – Taiwan /the Philippines, North Korea & the continuing India VS China northern border standoff
Hopefully, some of these issues will be resolved in 2024 and beyond.
The vast majority of construction bulk materials, such as timber / plywood & OSB, steel products (rebar & structural steel), copper products, roofing, cement, concrete and plumbing & electrical components have started to decline from their record high prices experienced back to COVID levels, some of these bulk construction materials have declined by as much as 10% to 15%. Unfortunately, most construction bulk materials and to some extent construction related equipment such as HVAC components, pumps, electrical equipment are still 5% to 15% or more expensive than they were 12 months ago.
Transportation / ocean freight costs have increased significantly due to the continuing missile attacks on ships in the Red Sea and Indian Ocean.
Inflation is remaining reasonably high across the globe, however it is starting to moderate in most countries.
The hastening utilization of and Artificial Intelligence (AI) & data science has the ability to considerably impact Construction and Project Management practices and Project Execution methods. Estimating, planning and procurement current routines could be transformed in as little as 5 years, if the pace of utilization of AI continues at its current rate. AI will present the construction industry with both short term challenges and future growth opportunities in the years ahead. We will hear much more on the use and application of AI related to Engineering, Procurement and Construction in the coming months and years. More and more companies are implementing AI technology, AI will continues to evolve and improve. Concerns abound on AI’s impact on current and future employment and its long term impact on the current workforce.
The continuing use of pre-assemblies, pre-fabrication and modular construction methods is gaining wider application that can optimize field labor, constriction costs and schedules.
THINGS WE WILL SEE IN THE 2nd Q OF 2024:
USA, CANADA & MEXICO are forecast to see between 2.2% & to 3.4% GDP growth in 2nd Q of 2024.
The 2024 US / Canadian / Mexico Construction market is estimated to be in the $3.05 to $3.15 trillion range, an increase of 2.9% from 2023.
In the USA, the year and half US manufacturing construction boom is starting to see some signs of a gradual slowdown. However, there are still a number of EV manufacturing and battery plants together with computer FAB facilities and call centers in the development pipeline that will keep this construction sector reasonably busy for the next 18 to 24 months.
The US construction industry continues to face supply chain challenges, price spikes, longer delivery times for such as components as MCC / switchgear, modules / specialized skids, compressors, pumps, fabricated process piping, HVAC / HEPA equipment and filters.
Extreme shortages of skilled labor such as Pipe-fitters, Welders, Electricians and Instrumentation technicians continue to be a serious problem to the US construction industry.
US construction inflation will continue to remain in the 3.5% to 3.9% range for the next 6 to 9 months. High interest / borrowing rates will continue to negatively impact the US Commercial / Housing sector.
US Construction material inflation in the 3 year period from 2021 to 2024 has increased by as much as 24%, with a lot of the increase attributable to COVID and the following supply chain issues and material shortages.
In the period 3/2021 to 3/2024, these construction materials have increased by the following percentages:
- RM Concrete 16% to 21%
- PC Concrete 14% to 18%
- Facing Bricks 14% to 18%
- Copper Pipe / Cable 15% to 20%
- Roofing Products 14% to 19%
- Timber / Plywood Products 12% to 16%
- Rebar / Structural Steel 21% to 28%
- Gypsum Wallboard 17% to 21%
- HVAC / Plumbing Fixtures 11% to 17%
- Process Equipment / Piping 9% to 18%
- Electrical Equipment / Fixtures 15% to 22%
- Paint / Coatings 15% to 20%
USA Real GDP growth forecasts for 2024 is in the 2.7% to 3.6% range, not too bad considering all the events and challenges the economy has faced.
Canada’s construction activity in the 2nd Q of 2024 is forecast to expand marginally by 1.5% to 2.5% over 2023. Construction material costs are set to increase by 2.8% to 3.3% and construction labor will see an increase of 2.8% over the same period in 2023.
Ontario, British Colombia and Quebec appear to the busiest Canadian Provinces for construction, with a mixture of Commercial, Infrastructure, Industrial and Residential construction activity. The Canadian unemployment is currently at 5.7%, with construction a little higher at 6.8% to 7.1%.
The Mexican construction sector is forecast to grow in 2024 and 2025 due a number of Government sponsored infrastructure projects and a pipeline of commercial and industrial projects. Mexico’s GDP will be in the 2.4% to 2.7% range going into 2024 2nd half. Inflation is currently 4.8% to 5.3% and construction unemployment is 2.8% to 3.2%, which is a significant improvement from 12 months back.
Western & Eastern Europe are forecast to see minimal or negative GDP growth in the 2nd Q of 2024:
The European Union will continue to experience zero to minimal construction related growth in 2024 as the economic consequences from the war in Ukraine continues. The Euro Zones economies have been challenged in 2023, prospects overall appear to be improving. Energy price spikes have started to fall in the last 6 months, which should assist the construction sectors in 2024. The value of the Euro has been progressively declining against the US dollar for the best part of 18 months, some economists are projecting that the Euro could fall to between 0.85 and 0.90 to the US dollar in the next 6 months. This, of course, will impact inflation in Europe and could be the catalyst to increase construction related materials costs.
The German construction industry is forecast to see zero growth in 2024 German CAPEX costs are forecast to decline by 5% over the previous year. The size of German construction sector is between $260 and $280 billion. Many German capital projects were put on hold in 2023 due to the Russian / Ukraine conflict and the potential of a serious gas shortage. Construction activity in Germany is marginally improving from 6 to 9 months back. The German Government has allocated billions of Euros for the expansion of Germany’s infrastructure that includes new and refurbished highways, bridges, ports and rail facilities
The UK experienced zero growth last year and this trend is continuing with construction activity in the UK is down by 10% to 15% from a year ago.
The London area is the only area that appears to bucking the somewhat overall UK gloomy trend. The UK will have a General Election sometime in 2024, the ruling Tory party will endeavor to boost the economy, which usually translates to addition funds spent on construction related capital projects.
So far 2024 has not been a good year for construction in the UK, house building is down by more than 8%, the high speed HS2 rail link from London to Birmingham has been significantly scaled back, and plans to build new NHS hospitals have been put on hold.
A number a major and mid-sized UK construction related companies have gone out of business in 2023, hopefully this will moderate significantly in 2024.
The UK pound remains weak against the US dollar on growing concerns regarding the stability of the UK finances, this could further increase inflation, oil & many imported items are priced in US dollars. The UK pound has fallen by more than 5% against the US dollar in the last 6 months to 1.26 US$ to a GBP.
We are starting to see an increase in new and revamped Industrial facilities across the UK, Germany, France and Italy as we move into the 2nd half of 2024, perhaps an indication that these countries and the rest of Europe are set to see a more normal construction situation in the 2nd half of 2024 and beyond.
Many French capital projects were put on hold in 2023 due to the Russian / Ukraine conflict. Construction activity in France is gradually starting to improve. The French Government is projected to increase future expenditures on new and refurbished roads, bridges, ports, airports and rail facilities….. This points to the 2nd half of 2024 being a much better period that the 3 previous years for the French construction sector. France’s inflation rate is reasonably high at between 3.1% and 3.7%%, look for this rate to start to trend downwards in the next 3 months.
ASIA – Asian countries are projected to see 3.3% to 4.8% GDP growth in the 2nd Q of 2024:
India’s construction sector has been growing at a record pace in the last 5 years. India is set to become the 3rd largest Construction Market by 2026 only trailing the USA and China, will we see India overtake China in the next decade, stay tuned.
The Indian construction industry is forecast to be in the $0.7 to $0.8 trillion range by the end of 2024. Construction is close to 11.5% of India’s GDP and one of India’s major industries.
India’s construction industry has performed a crucial 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 2024 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 18 to 24 months.
India’s GDP growth rate is forecast to be in the 7.6% to 7.9% range in 2024 ahead of all major countries and perhaps double that of its rival China. India has overtaken China as the world’s most populated country in 2023, with a population of 1.425 billion.
India is experiencing a construction boom and is forecast to see annual growth in its construction sector of 8% to 11% in 2024 and 2025. Ten years ago, 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 capital investment. We are seeing more US & Western European capital investment shifting into India. India is now viewed as the place to build new manufacturing / production facilities. The military standoff between India and China in the northern Himalayan region is tenuous and threatening, with troops positioned in close proximity to each other, both countries are claiming sovereignty of the disputed border area.
The Chinese construction industry is forecast to see GDP growth of 4.2% to 4.8% in the 2nd Q of 2024. China’s Governments 14th 5 Year plan calls for domestic investment in Transportation, Infrastructure, Energy and Urbanization projects. The halcyon growth rates that we saw 5 or more years back are perhaps in the rear view mirror now as we move further into 2024. China’s inflation rate is currently 1.1% to 1.4% and unemployment is between 4.9% and 5.4%.
Indonesia has commenced construction on its new futuristic capital “Nusantara.” President Widodo proclaimed that Jakarta, the current overcrowded, unhealthy and polluted capital which is predisposed to earthquakes, flooding and is steadily submerging below sea level would be withdrawn as Indonesia official capital city. The new capital 1,300km (800 miles) away from Jakarta on the island of Borneo. Thousands of construction workers are currently installing utilities, roads and temporary worker camps. Construction of this new capital will take at least 5 years or more and will cost more than $10 billion.
Japan’s construction industry for the sixth year continues to experience slow or minimal growth in its civil / infrastructure, home building, commercial, institutional and industrial sectors, perhaps mirroring Japans steadily declining and aged population. Japan’s construction industry is forecast to grow by 1.5% to 2.5% in 2024 very similar to previous years.
The Japanese construction sector is estimated to be $610 billion in 2024 or close to 8% of the country’s GDP.
Some Asian nations such as India, Bangladesh, Malaysia, Sri Lanka, Indonesia, Singapore, Pakistan, Philippines, Thailand, Vietnam and Laos have a huge need for new highways, bridges and other transport and power related projects.
AFRICA – African nations are set to see minimal, or in some cases negative GDP growth in the 2nd Q of 2024:
The most active African countries in the 2nd Q of 2024 for construction will be Egypt, South Africa, Nigeria, Ethiopia Uganda, Kenya and Mozambique.
Africa’s population is forecast to grow to more than 2.5 billion in the next 25 years, from the current 1.2 billion, this growth will fuel the need for all kinds of construction projects across Africa’s 54 counties.
Africa’s construction market is forecast to be in the $75 to $85 billion range in 2024.
The African Construction sector will continue to face challenges and slow growth in 2024.
Escalated oil, diesel, food and energy costs are deterring future construction and economic growth in the vast majority of the 54 African nations.
Egypt will construct one of the largest wind farms in the middle-east valued at more than $7.5 billion by 2027.
Also in the construction pipeline are plans to build a new nuclear plant, upgrades to Egypt’s Petro-Chemical installations and new railroad facilities.
Ethiopia construction industry is estimated to be in the $50 to $60 billion range as we move into 2024.
Ethiopia’s construction sector developing with a good number of infrastructure related projects in the pipeline, the construction industry is estimated to grow by 5% to 6% in the next couple of years.
Nigeria’s new 650,000 barrel a day Dangote refinery recently came on stream with its first crude oil loading.
Nigerian’s construction sector is forecast to grow by 3% to 5% in 2024, high inflation remain a continuing challenge. Nigeria is still challenged by the increasing cost of imported and domestic construction materials. The annual inflation rate in Nigeria is between 18% and 22%. For the Nigerian construction sector this is a serious challenge.
The South African construction sector is forecast to grow by 2.2% to 2.6% in 2024, high unemployment and inflation continues to be a significant problem.
African counties such as Egypt, Ethiopia, Kenya and some of the North African nations are forecast to experience a slow but steady improvement to their economies and construction sectors compared to the 2 or 3 difficult COVID previous years.
RUSSIA -Russia is forecast to see positive GDP growth in the 2nd Q of 2024:
Russia suffered a major blow on 3 / 24 with the terrorist attack on a Moscow concert hall attack losing 130+. Unemployment is only 2.9%, it would appear that Russia is set to continue its conflict with Ukraine for perhaps the next 6 months or longer.
Unfortunately, the Russia-Ukraine conflicts has impacted the Global Economy and Global Construction Sector, look for this problem to continue until a peaceful solution can be found.
Are sanctions against Russia working? The answer is NO they are not. The Russian Ruble is currently one of the world’s strongest performing currency, the Russian Ruble has been resuscitated by enhanced crude oil exports to both China and India.
Russia is currently experiencing a high construction inflation rate of between 5.5% and 6.6%, this of course will lead to higher construction costs or projects getting cancelled in 2024.
The USA, European Union, UK, Canada, Japan, South Korea and Australia have levied tough sanctions / penalties on Russia with possible more to come as a result of their hostilities against Ukraine. Russia will have to deal with the severe sanctions that could cripple its economy & construction sector. Many US and European Construction related companies have moved their operations out of Russia.
Russia is a very significant supplier / exporter of oil, natural gas and metals. Elevated prices on essential materials / metals / commodities, have started triggering major price spikes around the world. Ukraine and Russia supply up to 35% of world’s wheat and barley requirements. Countries in the Middle East and in Africa are major importers of these crops, prices have risen by more than 40% with both Russia and Ukraine unable to export these products.
The Russian economy prior the commencement of hostilities in Ukraine was slightly smaller in economic terms than Italy, look for the Russian economy and construction sector to contract by at least 5% to 10% in 2024, price hikes, high inflation and rising unemployment appears to be in the cards in the next 6 to 12 months.
Needless to say, 2024 will be a challenging year for the Russian construction sector. The effect of the ongoing war with Ukraine on the construction sector has yet to be fully comprehended.
SOUTH AMERICA – South America is predicted to see minimal GDP growth in the 2nd Q of 2024:
The 12 countries that constitute South America have a combined construction market of $90 to $95 billion in 2024.
South America’s construction sector remains stable and will experience minimal growth as we move into the 1st Q of 2024.
The Brazilian construction sector is estimated to be a $125 billion market or close to 6.5% of the country’s GDP. Brazil’s political and economic situation appears to be improving. Inflation / escalation inflation in Brazil is running close to 4.5% which is a big improvement to 6 months back.
Argentina is experiencing construction inflation rate of between 50% and 75%, reports from Venezuela that inflation is more than 100%. Chile & Colombia are both experiencing reasonably high inflation rates as we move into 2024 and unfortunately this will impact construction costs and future construction activity.
The smaller nations of South / Central America and Caribbean, such as Bolivia, Peru, Paraguay, Ecuador, Panama, Dominic Republic and Jamaica are challenged by high unemployment levels, inflation and rising costs of construction related materials.
Construction related bulk materials and equipment such as copper (wire / pipe), structural steel, rebar, piping (PVC, CS & SS), lumber/ plywood, windows, doors and instrumentation devices are starting to moderate in most countries.
MIDDLE EAST – The Middle East countries will see 2.7% to 4.4% GDP growth in the 2nd Q of 2024:
The Middle East construction market is forecast to be in the $1.40 to $1.45 billion range in 2024.
The Middle East region is experiencing significant growth in Saudi Arabia, while other Middle East countries are struggling with the fallout of the Israel / Hamas conflict.
Saudi Arabia is running at a blistering pace towards its Vision 2030, the kingdom is experiencing an amazing construction boom. Every day we read of new mega projects being planned and breaking ground in most regions of the kingdom.
Saudi Arabia has recently announced the plans to construct more than 20 mega capital projects all across the country that will significantly transform the country in the next 5 years. Some of these projects include Neom a vast new high-tech city, the Mukaab a 400-meter-tall office tower that will be the tallest structure in the Middle-East, the King Salman Energy Park, Oxagon a new floating city in the Red Sea, close to the Suez Canal, the new Riyadh Metro, one of the largest public transport capital projects in the world and the new Red Sea International Airport. These major capital projects and the ongoing infrastructure, mining and Oil & Gas construction sectors promises to make Saudi Arabia a very active location for construction in 2024 and beyond. The capital projects are estimated to cost between $750 and $900 billion.
These vast and bold concepts to construct these mega projects are focused at restructuring the country into a “world class” global economic, commercial and tourist destination.
Hamas’s attack on Israel and Israel’s response against Gaza have reversed the peace process in the Middle East, this conflict could become a wider regional war between the USA and Iran.
Saudi Arabia’s construction sector is by far the largest in the Middle East, over the largest 5 years Saudi Arabia’s construction sector has grown by as much as 20%, the size of the Saudi Arabian construction market in 2024 is estimated to be between $85 and $95 billion.
Recently, a new community located in Jeddah was announced with more than 15,000 houses and supporting facilities called Alarous. There are also other projects in the pipeline to construct more than 200,000 new housing units across the KSA by 2030.
A new ski resort named Trojena, has recently been announced valued at more than $200 million
The new Red Sea resort area will contain more than 40 resort / hotels providing more than 10,000 luxury suites / rooms and more than 2,000 villas and luxury housing units together with supporting amenities. Another similar facility located at Shura Island that contains a number of similar facilities is under construction.
All of the 2024 future projected Middle East construction growth, particularly in the oil / refinery, energy petro-chemical / industrial and commercial construction is fueled by $80 to $100 a barrel of crude oil.
Dubai continues to be an active construction market, with numerous infrastructure and commercial projects currently under construction or in the development pipeline.
The rising price & demand for oil could turn out to be a great boost for some Middle East countries that could benefit future Oil & Gas CAPEX construction projects. Construction is projected to steadily increase Qatar, UAE / Dubai, Bahrain and Kuwait over the upcoming years fueled for the most part by oil and gas revenues.
Australia & New Zealand combined will see 1.2% to 1.9% GDP growth in the 2nd Q of 2024:
Australia’s commerce friction with China, conflicts in Europe and the Middle East and the recent attacks on shipping that have increased ocean freight costs, has not been beneficial to the Australian and New Zealand construction sectors in the last 6 to 12 months.
The Australian construction industry is forecast to decline by 2% to 3% from last year’s expenditures.
Recent construction bankruptcies is not a particularly positive trend as we move into the 2nd half of 2024.
The Australian home building construction sector is set to contract by 4% to 6% in the remainder of 2024, caused for the most part by high borrowing costs and elevated construction prices.
The size of the New Zealand construction market is estimated to be in the $55 to $60 billion in 2024, construction activity is expected to remain similar to 2023.
Overseas – ocean freight costs have started to trend downwards, the importation of construction materials and capital goods into both Australia and New Zealand is a significant cost item to both countries.
2nd Q of 2024 Construction Outlook for Major Countries:
Countries | 2nd Q 2024 % GDP Growth | 2nd Q 2024 Inflation % | 2nd Q 2024 Unemployment % | Comments on Construction in 2nd Q of 2024 Future Spending Activity |
USA | 2.7 – 3.3 | 3.2 – 3.5 | 3.7 | The good news for the US construction sector continues, we have seen various announcements of plans to build a number of Electrical Vehicle Manufacturing / Battery Facilities, Semi-Conductor / Computer Chip Facilities, Call Centers, Logistical Centers and Fulfillment type facilities in many regions across the country. Extreme shortages of skilled labor such as Pipefitters, Welders, Electricians and Instrumentation technicians continue to be a serious problem to the US construction industry. US construction inflation will continue to remain in the 3.5% to 3.9% range for the next 6 to 9 months. High interest / borrowing rates will continue to negatively impact the US Commercial / Housing sector. The USA is making noteworthy advances over some of it economic rivals with the CHIPS / Science act passed in mid-2023 and costing more than $50 billion that funds various computer chip manufacturing / high-tech facilities. The USA construction sector is experiencing a boom in new EV manufacturing & battery production facilities along with computer chip facilities & call centers that have recently been announced. This surge in spending is expected to continue into the 1st half of 2024 and possibly beyond. |
CANADA | 0.7 – 0.9 | 2.9 – 3.1 | 5.7 | The Canadian infrastructure, civil engineering, mining and Oil & Gas construction sectors are experiencing a pick-up as we move into 2024. Ontario, British Colombia and Quebec appear to the busiest Canadian Provinces for construction, with a mixture of Commercial, Infrastructure, Industrial and Residential construction activity. The Canadian unemployment is currently at 5.7%, with construction a little higher at 6.8% to 7.1% |
BRAZIL | 2.1 – 2.7 | 4.2 – 4.7 | 7.7 | Not a lot to report on future 2024 construction activity, Brazil is still in a recovery mode after 2 tough years related to COVID.
The Brazilian construction sector is estimated to be a $125 billion market or close to 6.5% of the country’s GDP.
Brazil’s political and economic situation appears to be improving. Inflation / escalation in Brazil is running close to 3.4% which is a big improvement to 3 months back. |
UNITED KINGDOM | 0.2 – 0.4 | 3.8 – 4.2 | 3.9 | In the UK, the thinking is that the commercial construction sector is recovering with prospects for 2024 being better than last year.
Construction activity in and around London is still reasonably active.
So far 2024 has not been a It has not been a good year for construction in the UK, house building is down by more than 8%, the high speed HS2 rail link from London to Birmingham has been significantly scaled back, and plans to build new NHS hospitals have been put on hold. |
GERMANY | 0.2 – 0.4 | 2.4 – 2.9 | 3.2 | The German construction industry is forecast to see zero growth in 2024 German CAPEX costs are forecast to decline by 5% over the previous year.
Germany has just signed a major deal with Norway to purchase a large amount of gas over the next 20 years valued at many billions of $. |
FRANCE | 0.7 – 0.9 | 3.3 – 3.6 | 6.9 – 7.6 | Numerous French CAPEX projects were put on hold in 2023 due to the Russian / Ukraine conflict. Construction activity in France is gradually starting to improve. The French Government is projected to increase future expenditures on new and refurbished roads, bridges, ports / airports and rail facilities. Which point to the 2nd half of 2024 being a much better period that the 3 previous years for the French construction sector. France’s inflation rate is reasonably elevated at 4.5%, look for this rate to start to trend downwards in the next 3 months. |
RUSSIA | 4.9 – 5.7 | 6.7 – 7.5 | 1.9 – 2.9 | Unfortunately, the Russia-Ukraine conflicts has impacted the Global Economy and Global Construction Sector, look for this problem to continue until a peaceful solution can be found. Russia suffered a major blow on 3 / 24 with the terrorist attack on a Moscow concert hall attack losing 130+. Unemployment is only 2.9%, it would appear that Russia is set to continue its conflict with Ukraine for perhaps the next 6 months or longer. |
JAPAN | 0.9 – 1.2 | 2.1 – 2.4 | 2.2 – 2.5 | Japan’s construction industry for the sixth year continues to experience slow or minimal growth in its civil / infrastructure, home building, commercial, institutional and industrial sectors, perhaps mirroring Japans steadily declining and aged population. Japan’s construction industry is forecast to grow by 1.5% to 2.5% in 2024 very similar to previous years. |
CHINA | 4.2 – 4.8 | 1.1 – 1.4 | 4.9 – 5.4 | The construction sector in China is slowing down as we move further into 2024, it appears that the overall economy is facing challenges. China the world’s 2nd largest economy is still dealing with the adverse impact of the COVID virus, the demand for new housing, together with the weakness pre-owned property prices and less demand for Chinese products / exports around the world are the basic reasons for this speedy slowdown in China. 2024 will be a less than stellar year for the Chinese construction sector. China’s Government reported inflation of 0.5% in 2023 which is very low compared to other major countries, this rate is possibly open to interpretation similar to the low COVID casualty rate reported by China, some economist believe the real rate is between 0.8% and 1.2%. |
INDIA | 8.4 – 8.8 | 4.8 – 5.2 | 7.8 – 8.3 | India’s construction sector has been growing at a record pace in the last 5 years. India is set to become the 3rd largest Construction Market by 2026 only trailing the USA and China, will we see India overtake China in the next decade, stay tuned.
India has overtaken China in as the world’s most populated country in 2023, with a population of 1.425 billion.
India will experience solid growth in 2024, a high GDP of perhaps more than 8% and moderating inflation at less than 5%, the mood in India’s construction sector is upbeat for at least the next 3 to 5 years. The Indian construction market is estimated to be $750 billion, or close to 11.5% of India’s GDP one of India’s major industries. |
2nd Q 2024 Prices at a Glance:
- Forecast Cost of a barrel of Crude Oil $85 – $93
- Forecast of Euro / US $ Exchange Rate 0.91 – 0.94
- Forecast of UK Pound / US $ Exchange Rate $1.19 – $1.27
- Forecast of Copper per pound $3.95 – $4.05
- Forecast of Gold per Ounce $1,980 – $2,050
- US Construction Material Inflation (Basket of 10 construction materials) 3.2% – 3.9% – Average 3.7%