European Funding To Energise CEE Infrastructure
BMI View: Central and Eastern European infrastructure markets will experience an upswing in activity with a broad recovery in 2014 to continue over 2015. This recovery is primarily due to greater access to infrastructure funding from the European Union earmarked for projects across the region and the European Commission and European institutions accelerate infrastructure financing.
Since the end of 2013, we have held the view that Europe's construction and infrastructure markets will experience an upswing in activity, with a broad recovery in 2014 to persist over 2015 ( see 'North America And Europe In 2014: Turning A Corner', 12 December 2013). This trend is particularly prominent in Emerging Europe with a new wave of European Union (EU) infrastructure funding earmarked for the region in the coming two years. We are reiterating this view after 2013 official data from across the region's construction markets points to a more positive outlook over 2014. Among these markets, we highlight Hungary, Poland and Estonia as markets we expect to perform well over a three-to five-year time horizon.
Our forecasts show that growth is set to return to the region at a sustainable, albeit moderate rate. We are currently forecasting Emerging Europe's construction market to enjoy an average real growth rate of 3.9% per annum between 2014 and 2018, after contracting by 0.6% in 2013.
|Region Returning To Positive Growth Outlook|
|Construction Industry Value (LHS) and Real Growth (RHS)|