BMI View : Angola's construction industry will average annual growth of 5.1% in real terms over our 10-year-forecast period, driven primarily by investment in the country's residential and non-residential sector, as well as into power generation and freight infrastructure. Untapped oil reserves also hold potential to boost growth over the second half of our forecast. While we highlight the long-term cost of servicing the debt to be a downside risk for Angola's infrastructure sector, the issuance of the country's first Eurobond will partially help to address the financing deficit, with further support coming from China.
Latest Updates And Structural Trends
We continue to forecast 2.5% real growth over 2016, 4% over the next five years and 5.1% over our full 10-year forecast period.
China will remain the most dominant investor in the country, as Brazilian construction firms reduce their activity in Sub-Saharan Africa.
Angola sold its first Eurobond in November 2015 and we anticipate some of the funding will be directed to infrastructure development. However, while a positive for short-term funding, the bond will be expensive to pay off in the long term, which could divert funds to debt servicing, away from infrastructure investment.
|e/f = BMI estimate/forecast. Source: Ministry of Planning, Angola Central Bank, BMI|
|Construction industry value, AOAbn||988.49||1,114.03||1,257.07||1,412.31||1,570.07||1,749.68||1,990.27|
|Construction Industry Value, Real Growth, % y-o-y||8.00||3.65||2.54||3.35||3.17||3.94||6.75|
|Construction Industry Value, % of GDP||8.4||9.4||9.1||8.8||8.3||8.5||8.6|
Angola scores 33.1 overall in our Sub-Saharan Africa RRI, below the regional average of 42.5.
State involvement in construction activities hinders foreign investment in the industry, although we note efforts to liberalise the power sector could help ease investor concerns.
The country suffers from inadequate financial infrastructure and an ailing power supply, which serve as deterrents to businesses aiming to enter the market.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Angola Infrastructure Report features BMI Research'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 Angola Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Angolan infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Angola to test other views - a key input for successful budgetary and planning in the Angolan infrastructure market.
- Target business opportunities and risks in the Angolan infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Angola.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant national and multinational company developments. These are broken down into construction (social, commercial and residential), transport (roads, railways, ports, airports, etc), and energy & utilities (powerplants, pipelines and so on).
Industry SWOT Analysis
Analysis of the major strengths, weaknesses, opportunities and threats within the infrastructure and construction sectors and within the broader political, economic and business environment.
BMI Industry Forecasts
Historic data series (up to 2012) and forecasts to end-2024 for all key industry indicators, supported by explicit assumptions, plus analysis of key developments in the market and risks to the main forecasts. Indicators include:
Construction: Industry value (USDbn); contribution to GDP (%); total capital investment (USDbn); real growth (%).
Construction industry real growth forecasts (%) and industry value (USDbn) forecasts for industry sectors are split into Residential and Non-residential and Infrastructure sectors. Where the data is available for particular countries the infrastructure is further broken down into indicators for the transport subsectors of roads, railways, airports and ports and the energy and utilities sub-sectors of power plants and transmission grids, oil & gas pipelines and water infrastructure. This dataset is unique to the market.
The reports also include analysis of latest projects across the infrastructure sectors (transport, utilities, commercial construction).
BMI’s Infrastructure Risk Reward Index
BMI’s Risk Reward Index provides investors (construction companies, suppliers and partners) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points. These provide indices of highest to lowest appeal to investors, with each position explained.
An assessment of the competitive landscape and key challenges to entering the market. Details of the largest companies active in the sector across the sub-segments of the industry, including the key financial figures from some of the largest players in the sector.
Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape to generate company SWOT analyses. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.
The Infrastructure reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports.
*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.