WORLD NEWS
8
GLOBAL
Residential forecast
Annual growth of +2.9% seen in global house
building as developed markets rebound and rural-
to-urban migration continues.
W
orldwide construction of new housing units is forecast to reach
61.3 million units in 2018, according to a new report by market
research company The Freedonia Group. It said annual growth in
the residential construction sector would average +2.9% over the forecast
period.
Although global population growth is expected to decelerate over the
forecast period, Freedonia said declines in average household size would
support +1.6% annual growth in the number of households, which would
in turn boost demand for new housing. Changes in population distribution,
mainly due to rural-to-urban migration, are also expected to bolster demand
for new housing, particularly in urban areas.
Worldwide construction of new multifamily units (apartments) will
increase +3.2% a year through to 2018 with nearly 90% of growth taking
place in the Asia-Pacific and Africa/Middle East regions. However, in those
regions, and worldwide, single-family dwellings (houses) will continue to
make up the majority of new residential units.
Higher income countries that suffered dramatic declines in residential
construction during 2008 to 2013 are forecast to see some of the fastest
gains in construction of new housing units, with advances coming from
a depressed 2013 base. Spurred by a partial rebound in US residential
construction, North America is forecast to post nearly +8% annual growth
in new housing units.
However, the largest absolute gains in construction of new housing are
expected in the Asia-Pacific and Africa/Mideast regions. Nearly 38 million
new housing units will be constructed in the Asia/Pacific region in 2018,
accounting for over 60% of the world total, even though the rate of growth
in the region will be below the global average.
Smaller households and a rising demand for urban housing will support
the activity, particularly in developing countries in the region.
US
Republican senator and House Majority Leader Kevin McCarthy has called
for the winding-down of the US Export-Import (Exim) bank, which supports
billions of Dollars’ worth of infrastructure projects around the world through
loans, guarantees and insurance to support exports by US companies.
Mr McCarthy said in an interview that he would not support the renewal
of the bank’s charter when it comes up for review in September. “The
Exim bank is not something the
government needs to be involved
in. The private sector can do it.
One of the biggest problems with
government is they go and take
hard-earned money do things the
private sector can do,” he said.
However, according to the Bank, it
returned more than US$ 1 billion in
profits to the US Treasury last year,
having made 3,842 authorisations
worth US$ 27.3 billion. Of these, it
provided support of US$ 9.8 billion
for infrastructure projects globally
in 2013. It also supports the export
of manufactured goods, including
construction and mining equipment.
international
construction
july-august 2014
US
Up again
Construction put in place in the
US for the 12 months to the end
of May stood at US$ 956 billion, a
+6.6% rise on a year ago according
to the US Census Bureau. This
was also an increase on the year-
to April figure and over the course
of the first five months of 2014,
construction output was up +8.2%
on the same period last year.
In recent months, residential
construction has driven growth.
however, there was a downturn
in
May.
Private
residential
construction was down -1.5% from
April, and the growth compared to
a year ago was +7.5%, a significant
slowdown on earlier in the year.
However, private non-residential
construction saw an acceleration
in May. The sector was up +1.1%
compared to April, and +11%
compared to a year ago, thanks to
strength in the power, commercial,
manufacturing
and
office
construction sectors.
“The May figures show that
construction activity continues to
expand, but with lots of variability
by month and project type,” said
Ken Simonson, chief economist
with the Associated General
Contractors of America (AGC).
“These uneven patterns seem likely
to continue for the rest of the year.”
He continued, “The outlook is
brightest for multifamily and oil
and gas-related projects, including
manufacturing. But single-family
and office construction, which have
done well so far, may fade later this
year.”
Association officials said the
increase in highway and street
construction will do a U-turn if
Congress and the administration fail
to act soon to replenish the Federal
Highway Trust Fund. It added that
current estimates indicate the federal
government will have difficulty
reimbursing states for payments to
highway contractors in July.
“Stabilising the Highway Trust
Fund should be lawmakers’ top
priority when they return from
recess early next week,” said Stephen
E. Sandherr, the association’s chief
executive officer. “Construction
firms, their suppliers and highway
users should not be held hostage to
political posturing.”
EUROPE
Growth
returns
The
European
Construction
Industry Federation (FIEC) says
European construction output fell
-2.3% last year to € 1,162 billion
(US$ 1,580 billion). However,
it forecasts a +0.1% increase this
year – equivalent to about € 1.5
billion (US$ 2.0 billion) additional
activity.
FIEC said that cuts in government
spending had been particularly
damaging to the industry last year,
with construction of public non-
residential buildings falling -5.5%,
while infrastructure was down
-3.7%. These losses were offset
to some degree by a recovery in
housing, which is expected to rise a
further 1.0% this year.
FIEC said the downturn last
year saw industry employment fall
some -4.1% in the EU. It added
that 2013 was the sixth consecutive
year that industry employment had
fallen.
SOUTH AFRICA
New venue
The next Bauma ConExpo Africa
exhibition in South Africa will be
held at the Johannesburg Expo
Centre (JEC), a change from
the city’s Gallagher Convention
Centre, which hosted the inaugural
Bauma Africa in September 2013.
The dates for the next show are 15
– 18 September, 2015.
The 2015 event will be jointly
organised by Messe München
International, which runs the
Bauma
and
Bauma
China
exhibitions, among others, and the
US-based Association of Equipment
Manufacturers (AEM), which is
best-known for the ConExpo-Con/
Agg exhibition. They said the new
venue offered 50,000 m
2
of hall
space and 60,000 m
2
of outdoor
space.
The organisers added that JEC has
good infrastructure for exhibitors
and visitors alike.
Bauma Africa 2013 at the
Gallagher Convention Centre
took up 60,000 m
2
of gross space,
attracted 754 exhibitors and 14,700
visitors from over 100 countries.
