BMI View: We maintain our tempered forecasts for Colombia's construction industry's real growth at 8% and 6.6% y-o-y in 2015 and 2016, respectively. Our more moderate outlook reflects the challenges facing the Colombian economy - namely the low oi l price environment, a weak peso and the peace process continuing to drag on.
Key Trends And Developments
Given the new oil price environment, our Country Risk (CR) team believes that the booming Colombian economy will lose its lustre. Latest economic activity data shows a significant slowdown, with Q115 real GDP growth coming in at 2.8% year-on-year. This is broadly in line with our CR forecasts for headline growth of 3.1% in 2015, well below 4.6% in 2014.
The lower oil price environment has prompted the Colombian government to revise its budget estimates significantly as oil revenues account for about one fifth of total government inflows. Moreover, lower oil prices are negatively impacting both business and consumer sentiment, posing a downside risk to growth in infrastructure and the residential/non-residential building sectors.
In response to the more challenging macroeconomic environment, the government has put forward an economic stimulus plan - though given the reduced government revenue, we remain sceptical about its full implementation. Should public spending from Pipe 2.0 materialise, it is transport infrastructure and housing projects which will be some of the main beneficiaries of this COP16.8tn (USD6.5bn) plan.
Despite the headwinds highlighted above, the national road programme 4G continues to make progress with the third wave of projects to be awarded in Q415. This positive trend in the transport infrastructure sector has been accompanied but increasing investment in the ports subsector.
Weakening investor sentiment is having a negative impact on the housing market. In order to support the segment, the government is promoting a number of policies including an increase in the number of...
The Colombia 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 Colombia Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Colombian infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Colombia to test other views - a key input for successful budgetary and planning in the Colombian infrastructure market.
- Target business opportunities and risks in the Colombian infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Colombia.
- 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.