No acceleration for construction industry

It became evident at the group's winter conference in Barcelona that building volume growth of just 1.3 per cent to € 1.2 bn is to be assumed for 2005 in the 19 states belonging to Euroconstruct. An increase of 2.2 per cent was achieved in the previous year. Still as late as June 2005, forecasts for the current year were envisaging growth at around the previous year’s level, which shows how the situation deteriorated in the second half of the year.
The European building and construction sector is continuing to develop in greatly varying ways. Whereas losses are being forecast from 2005 to 2008 for Germany and for Portugal in particular, four eastern European countries are experiencing headlong development with double-digit growth rates. Topping the list is Hungary with an increase of just under 40 per cent, followed by Poland (34 per cent), the Czech Republic (24 per cent) and Slovakia (18 per cent). However, the countries with the highest growth rates are at the same time the ones with the smallest market volumes.
Germany still continues to play a key role in the European construction sector, although the country has steadily lost ground since 1998. Its share of the volume of construction in Europe has sunk from 26 to 16 per cent since that time. Together with Britain (14.6 per cent), Italy (14.3 per cent), France (14 per cent) and Spain (12.3 per cent), Germany makes up the “Big 5” – the five west European countries that account for nearly three-quarters of the entire European construction volume.
Among the “Big 5”, only Spain, where growth is forecast to reach 13 per cent, clearly exceeds the average increase of 6.7 per cent calculated by Euroconstruct.
Private housing construction, which makes up around one-quarter of the market, seems to have left the good years behind and will be moving towards stagnation after 2006 in terms of value. This is another area where a clear contrast between east and west European countries is becoming evident: while development is on the decline in western Europe, growth is being recorded in the eastern countries and is due to gather momentum from 2007.
House construction is also expanding strongly in Sweden, Belgium, the Netherlands and Denmark, although it will be rather a short-term phenomenon here: the boom in Sweden could end in 2006, the market researchers are forecasting stagnation in Belgium from 2007, and for Denmark from 2008. Other major markets like France, Britain and Spain also have their best years behind them…