CIC - Construction Intelligence Center

Construction in Hungary to rebound

19 Jul 2017

Hungary’s construction industry is expected to reach a value of US$11.3 billion in 2021 in real terms, measured at constant 2010 US dollar exchange rates, according to a report by Timetric's Construction Intelligence Center (CIC).

According to the report, construction sector growth over the forecast period to 2021 will be supported by a gradual improvement in regional economic conditions, coupled with a resurgence in both investor and consumer confidence. This is expected to add momentum to the flow of investments into construction projects.

The industry’s expansion is expected to be supported by public sector investments in transport infrastructure projects as the government aims to revamp economic growth. Additionally, positive developments in the tourism and retail sectors and the expansion of the manufacturing sector are also expected to contribute to the industry’s expansion over the forecast period. 

In real terms, Hungary’s construction industry is expected to register a compound annual growth rate (CAGR) of 6.3%, a marked improvement on the 0.1% CAGR registered during the review period (2012-2016). 

Construction activity in Hungary was weak during 2016, owing to the effects of the economic recession. This had an adverse impact on business confidence, which in turn reduced the pace of investment in construction projects. Consequently, the industry’s output contracted by 15.7% in real terms in 2016, following an average annual growth of 6.0% during the preceding three years.

A sudden shortfall in the European Union (EU)’s structural funding for transport infrastructure projects resulted in reduced construction activity. This was due to allegations on the part of the Hungarian government in issuing project tenders against the rules stipulated by the EU. 

Infrastructure and Industrial Construction Segments to Drive Industry Growth 

Infrastructure construction was the largest market in the industry during the review period, accounting for 27.6% of its total value in 2016. The market is expected to increase in importance over the forecast period, to account for 30.0% of the industry’s total value in 2021. 

“Market growth is expected to be supported by increased investments in infrastructure projects, on the back of government efforts to address the growing traffic congestion,” comments Danny Richards, Lead Economist at Timetric's CIC.

Accounting for 19.5% of the industry’s total value, industrial construction was the second-largest market in 2016. Forecast-period growth is expected to be driven by a gradual increase in industrial production volumes, coupled with a rise in exports. 

About this report

This information is taken from the Timetric report: ‘Construction in Hungary- Key Trends and Opportunities to 2021’.

To find out more information about the report, please contact us at reports@timetric.com. To purchase the full report, click here

CIC clients can access the report here

About the Construction Intelligence Center

The Construction Intelligence Center (CIC) is the most comprehensive source of data and analysis on the global construction industry. The Construction Intelligence Center is a product of Timetric, which provides information solutions and technologies that enable organizations to drive business value and manage business risk.

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About Timetric

Timetric is a leading provider of online data, analysis and advisory services on key industry sectors. It provides integrated information services covering risk assessments, forecasts, industry analysis, market intelligence, news and commentary.

 

For more information and updates, please visit www.timetric.com.

 

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