SOUTH AMERICA (South America is predicted to see 2.4% to 2.8% GDP growth for 2020):
Forecasting the South American construction sector is a difficult activity, bearing in mind that there are more than 10 divergent countries that all have different construction practices & economic goals. The construction market forecast for each of these countries ebbs & flows on the policies of each Governments economic policies or social needs.
Overall, regional growth is forecast to quicken in 2020, moving upward to 2.6%, as economic situations continue to recover. Much of the future construction growth in South America will be enhanced by the improving economies & increased government spending on public facilities & infrastructure projects. The last three years have been challenging economically for most South American countries. However there are a few encouraging indications going into 2020.
The South American Construction / Infrastructure / Commercial Construction markets will experience moderate growth in 2020, commercial & office related type construction is active throughout South America. Shopping mall(s), apartments, warehouses, water supply / disposal, office developments, housing & light manufacturing facilities have & will continue to be built in major & mid-sized cities in Argentina, Chile, Central America (Panama, El Salvador, Guatemala & Nicaragua) & Colombia. Look for this trend to continue in 2020 & beyond.
Economic and construction recovery is happening in Brazil as we move into 2020, Brazil’s construction industry is experiencing modest gains as we move into the 1st Q of 2020 after three disastrous years. Brazil is currently experiencing an uptick in its’ construction sector, unemployment in 2020 in the Brazilian construction sector is 12% to 16% which is historically very high for Brazil, look for this rate to improve in 2020. Overall industry unemployment is slightly less, ranging between 10.5% & 11.5%, still historically high.
The Colombian construction sector is experiencing growth going into 2020, a number of large Infrastructure and Industrial projects are in the pipeline.
Argentina is experiencing a currency drop that indicates the country is heading into a recession & possible political turmoil going into 2020. Economic activity has fallen in the last nine months, high interest rates, & a drop in consumer confidence. These issues & rising inflation has put a damper on new construction projects.
The United Nations estimate that 5 million citizens have left Venezuelans as the country’s economic situation worsens. The Venezuela economic / construction state of affairs becomes more & more tenuous as we move further into 2020, the question is how long can this continue.
South America’s construction sectors will continue to experience restrained demand for EPC services. Argentina & Venezuela will continue to find 2020 to be a challenging year; they are both in recession. The other major countries, i.e. Brazil, Bolivia, Colombia, Chile, Ecuador, Paraguay, Peru & the Central American nations will all see positive / restrained GDP growth in 2020.