BMI View : We expect Egypt's construction sector growth to accelerate in the coming years as an influx of development and external funding eases Egypt ' s fiscal deficit and facilitates continued government investment in infrastructure projects. We retain our optimistic growth outlook for Egypt ' s construction secto r over the remainder of our ten- year forecast period on the back of elevated levels of structural demand for infrastructure and the government ' s active solicitation of private capital via Public Private Partnership (PPPs), both of which will provide support to Egypt ' s ambitious infrastructure investment targets. A deterioration in t he country's security situation poses the largest downside risk to our otherwise bullish forecast.
Latest Updates And Structural Trends
We have revised our 2016 construction sector growth forecast upwards to 9.7% to reflect an acceleration of construction activity and the disbursement of external funding. We expect broad-based growth across Egypt's construction spectrum over the long term, as Egypt's growing population increasingly strains the country's existing infrastructure.
The International Monetary Fund announced in August that it would extend a USD12bn loan over the next three years, alleviating pressure on Egypt's fiscal position.
Egypt's substantial housing deficit will continue to provide investment opportunities for private investors. Egypt's New Urban Communities Authority (NUCA) is set to invite 12 real estate developers to bid for a new phase of public-private partnership (PPP) projects, with an estimated total investment of USD25bn.
|e/f = BMI estimate/forecast. Source: National sources, BMI|
|Construction industry value, EGPbn||118.04||145.42||177.99||211.81||251.42||292.37||339.83||395.59||449.47||523.07||592.01|
|Construction Industry Value, Real Growth, % y-o-y||9.70||9.65||8.40||8.00||9.20||7.79||8.23||8.91||6.87||10.12||7.43|
|Construction Industry Value, % of GDP||4.9||5.3||5.5||5.6||5.8||6.0||6.2||6.5||6.6||7.0||7.2|
Egypt performs below average for the region in our Infrastructure RRI for the Middle East and North Africa, ranking 9th out of 14 countries, with an overall score of 52.4 out of 100.
The country's Industry Rewards score improved to 50 in Q416, though it still ranks below the regional average of 51.6.
Egypt achieves a weak Country Risks score of 49.2, mainly due to widespread corruption and limited institutional capacity to process tenders and permits in a timely manner.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
|Source: BMI Risk Reward Index|
The Egypt 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 Egypt Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Egyptian infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Egypt to test other views - a key input for successful budgetary and planning in the Egyptian infrastructure market.
- Target business opportunities and risks in the Egyptian infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Egypt.
- 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.