New Market Research Report: South Africa Infrastructure Report Q3 2014

From: Fast Market Research, Inc.
Published: Fri Jul 25 2014

In line with our view, growth in South Africa's construction industry continues to gather pace, with the industry growing in real terms by 4.9% in Q114. That said, we expect the multitude of downside risks affecting the market to drag on growth over the remainder of the year, bringing it in line with our forecast of 3.4% in 2014 . Strikes continue to be a major industry in the construction industry and importantly, the mining industry, which is a key driver of infrastructure investment. We note there is hope that a victorious ANC party will strive to better implement the NDP, however , we do not expect huge progress to be made.

Despite still lagging behind its regional peers in terms of growth rate, it is important to note South Africa's construction industry is recovering after its collapse following the world cup in 2010. We are now seeing a return to sustainable growth.

The residential and non-residential sector has been performing well, with Group Five, the construction major with most exposure to the housing sector, outperforming its peers. A push to move all people into formal accommodation by the government and the legislation for the promotion of Special Economic Zones (SEZs) should act as additional drivers to growth.

Full Report Details at

Many of the grand infrastructure programmes proposed by President Jacob Zuma draw on huge capex schemes by the country's state-owned infrastructure operators, including Eskom, Transnet, Prasa and Sanral. They all have multibillion-dollar plans in the pipeline; financing has proved to be a major obstacle and continues be so. Eskom and Transnet have made progress in issuing bonds to raise capital, but Sanral in particular continues to struggle with huge debts, which threatens investment into the road sector. The rail and port sectors are a key source of growth in our forecasts as Transnet has front loaded its spending plans with huge capacity expansion projects, for examples a new dug-out port in Durban. The government's...

The South Africa Infrastructure Report features Business Monitor International (BMI)'s market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.

BMI's South Africa Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the South African infrastructure and construction industry.

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