Construction activity around the world will soar by US$6.3 trillion (S$7.97 trillion) in 2025, with the growth explosion boosted by the new Asian Tigers comprising Indonesia, Vietnam and the Philippines, according to the Global Construction 2025 report.
Sponsored by 24 major companies, the report revealed that construction activity will account for 13.5 percent of global output, driven by the growing population of the developing world and rising urbanisation.
The report authored by industry experts from Global Construction Perspectives and Oxford Economics noted that “growth in the world’s global mega cities gives rise to major challenges for the engineering and construction industry. Some two billion additional city-dwellers are expected by 2050, giving rise to challenges around providing power, water, sanitation, housing, offices and transportation as well as doing this sustainably and developing new cities of the future”.
Two-thirds of the world’s construction activity will be focused in India, China and the US, while Indonesia is expected to be “the most dynamic” of the new Tigers, with the construction market posting an average annual growth of more than six percent until 2025.
Meanwhile, the Philippines and Vietnam are projected to post an average annual growth of five percent.
“Both Vietnam and the Philippines will benefit from broader inter-regional trade flows with China and neighbouring economies, as well as the need for investment in essential infrastructure and production capacity as their level of economic development increases,” said the authors.
While China surpassed the US as the largest construction market in the world in 2010, the report expects the US to witness a 40 percent growth by 2025.
“The recovery in the US construction market, which started last year, is forecast to continue, with housing remaining the fastest growing sector. We forecast the volume of construction output in the US to grow by over 75 percent between 2012 and 2025.”
Nikki De Guzman, Junior Reporter at PropertyGuru, wrote this story. To contact her about this or other stories email nikki@propertyguru.com.sg
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