BMI View: PPPs will be the major d river for infrastructure construction growth over the coming years, as the Colombian government has bee n widely successful in attract ing private sector capital, especially into the 4G Highway Concession Program me . Additional capital from international debt financing and newly creating infrastructure funds are helping to diversify funding sources for infrastructure and will be critical for maintaining robust growth in light of low commodity prices.
Latest Updates And Structural Trends
Colombia's construction industry will continue to outperform in the region, with the sector expected to reach 5.3% real growth in 2016 and average 5.7% annually over our five-year forecast (2016-2020).
The successful implementation of the public-private partnership under the auspices of the Agencia Nacional de Infraestructura (ANI), will be the major driver of future growth, with the vast majority of high-value projects set to move into the construction phase of development utilizing the model.
Within this space, the USD25bn 4G Highway Concession Programme will be the largest benefactor of innovative financing and PPPs. Projects continue to move forward under wave three of the program, with the USD648mn Pacifico 3 reaching financial close in March and Pacifico 2 reportedly close to doing so.
International capital will play a crucial role, helping to complement the domestic banking industry and bolster financing availability. In Q116 Goldman Sachs joined the ranks of the major international lenders supporting the 4G programme, with Brazil's Itau reportedly set to follow suit.
The creation of new infrastructure funds will further diversify Colombia's financing sources, reducing the risks associated with the financing stage of the project cycle. This will be critical for maintaining the flow of funds given that the Colombian economy is facing numerous challenges - namely the low oil price environment, a weak peso, and the ongoing peace process.
|f = BMI forecast. Source: BanRe, DANE, BMI|
|Construction industry value, COPbn||77,517.00||86,084.79||94,364.58||104,101.68||113,917.47||123,737.01||133,410.96|
|Construction Industry Value, Real Growth, % y-o-y||3.95||5.25||5.57||6.57||5.93||5.37||4.82|
|Construction Industry Value, % of GDP||9.5||9.7||10.0||10.2||10.5||10.6||10.7|
Due to the country's strong growth prospects and improving business environment, Colombia ranks second highest in our Latin America Infrastructure Risk/Reward Index regional table.
With regards to Country Rewards, where Colombia scores the highest at 69.8 out of 100, we highlight the labour market for infrastructure as being one of the strongest in the region.
Colombia also achieves a high score for the level of competitiveness in the market and the transparency of the tendering process.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
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.