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Construction output to shrink in France

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World Cement,

Moustafa Ali, Economist at GlobalData, has commented on the release of data from the French National Institute of Statistics and Economic Studies (INSEE) showing a steep fall in construction output in 2Q2020:

“The steep fall in French construction output, having contracted by 24.1% in the second quarter on a quarterly basis, reflects the lockdown measures imposed by the French Government in April and May and the closure of construction sites by a large number of firms in the sector.

“GlobalData forecasts that construction output will contract by 11.6% in France in 2020. With most firms having reopened sites by the end of May and the improvement in general economic conditions across the country, output is expected to significantly improve in the coming months.

“On a year-on-year basis, construction output is substantially down by 33.6% in 2Q2020 compared to 2Q2019. Construction was the worst hit sector in the second quarter, according to INSEE, with works suspended for most of the quarter. While output is expected to improve, downside risks remain, in particular, a second lockdown induced by another wave of infections later this year. With the economy also not expected to return to pre-COVID-19 levels in the short run, the weak economic outlook will weigh down on the French construction sector.”

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