BMI View: A return to positive growth in Estonia's construction and infrastructure industry is forecast for 2016, before holding fairly robust momentum over the next decade. Hot spots can be found in residential building, al though a housing bubble may be on the horizon, while EU transport and energy interconnectivity projects are seeing focused investment across the Baltics. Financing may be an issue given the small size of the market and the only tentative recovery in Estonia's external demand picture, al though private consumption will remain resilient in the short term .
Latest Updates And Structural Trends
Positive growth will return to the Estonian construction industry in 2016, with a confident 4.7% rebound after three years of recession.
We see the residential and non-residential sector only growing in dominance as a percentage of total construction value over our forecast period, rising from 63.9% in 2015 to 73.7% in 2024.
Despite projects gaining momentum, Estonia's energy infrastructure sector will grow only moderately over the next decade, averaging 1.8% growth annually to 2024, when its value will amount to EUR300mn (USD406mn).
Transport infrastructure will contribute 47% to total infrastructure value in 2016 at EUR210mn (USD215mn), before falling to 45.2% in 2024 and a total of EUR280mn (USD330mn).
|f = BMI forecast. Source: Statistics Estonia, BMI|
|Construction Industry Value, Real Growth, % y-o-y||3.54||4.74||4.82||4.09||3.23||2.96||2.93|
|Construction Industry Value, % of GDP||6.4||6.5||6.6||6.7||6.7||6.7||6.7|
|Construction industry value, EURbn||1.26||1.35||1.45||1.55||1.65||1.75||1.85|
Estonia, a low risk, high reward country in our Central and Eastern European RRI, has moved to the top of the table, although this has more to do with the movements of other nations and its rating is flattered by the high ratio of government spending as a percentage of GDP and the strong macro-fundamentals. However, in view of the country's small size, scope for further growth is also relatively limited, which has prompted local companies to shift focus abroad.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Estonia 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 Estonia Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Estonian infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Estonia to test other views - a key input for successful budgetary and planning in the Estonian infrastructure market.
- Target business opportunities and risks in the Estonian infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Estonia.
- 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.