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Growth forecast for Romanian construction industry

Published by
World Cement,

According to a new report from Timetric, ‘Construction in Romania – Key Trends and Opportunities to 2018’, the Romanian construction industry increased in value at a compound annual growth rate (CAGR) of 3.78% in nominal terms from 2009 – 2013. Meanwhile, foreign direct investment (FDI) in construction and real estate increased by 7.7% from RON24.4 billion (US$7.0 billion) in 2012 to RON25.9 billion (US$7.8 billion) in 2013. According to Banca Nationala a României, FDI in construction and real estate, as a percentage of total FDI, rose from 9.2% in 2012 to 9.8% in 2013. The increased FDI and improving consumer and investor sentiment is set to drive growth, and the industry is expected to post a nominal forecast-period CAGR of 1.78%.

Industry growth is expected to continue from 2014 – 2018 as a result of the government's focus on developing physical and social infrastructure, as well as the anticipated recovery in the global economy. The government plans to invest RON27.8 billion (US$7.9 billion) to construct 656 km of new highways by 2030 under the General Transport Master Plan, which will improve road connectivity throughout the country. Furthermore, the Romanian government increased its budget expenditure on the education sector by 10.4% from RON18.1 billion (US$5.2 billion) in 2012 to RON20.0 billion (US$5.9 billion) in 2013. This is expected to contribute to the expansion of educational infrastructure over the forecast period. Increased construction activity in the real estate, office building and waste processing sectors is also set to drive growth.

Adapted from press release by Rosalie Starling

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