BMI View: The positive outlook for Philippines' construction sector is supported by growth in public construction activity as the government's Public-Private Partnership programme gains traction, as well as sustained momentum in private construction activity. The upcoming elections in 2016 will weigh on construction activity.
Latest Updates And Structural Trends
Our outlook for the Philippines construction industry remains positive and we forecast real growth of 8.5% and 8.7% in 2016 and 2017 respectively.
We expect a relatively stable monetary policy to provide a favourable environment for potential homeowners and developers. This is reflected in our forecast, which expects the residential and non-residential building industry to expand at an average annual pace of 8.3% between 2016 and 2025 (compared to 6.4% for the transport sector and 7.9% for the energy & utilities sector).
We believe positive momentum in the approval of projects under the Philippines's PPP programme will continue over the months leading up to the presidential elections in mid-2016. Our longer-term outlook remains tempered by upcoming elections and project implementation deficiencies, but plans to introduce a new public-private partnership bill bode well for further private investments.
|e/f = BMI estimate/forecast. Source: Central Bank, National Statistical Coordination Board, BMI|
|Construction industry value, PHPbn||932.04||1,031.91||1,162.52||1,307.67||1,467.70||1,645.48|
|Construction Industry Value, Real Growth, % y-o-y||10.94||8.47||8.66||8.49||8.24||8.11|
|Construction Industry Value, % of GDP||6.9||7.0||7.2||7.3||7.5||7.6|
The Philippines fell by one place to the 14 th position out of 17 regional markets assessed in our latest Asia RRI (RRI). The country's overall score fell to 53.1 out of 100 due to growing external risk in the region.
With the upcoming elections in 2016, the Philippines is likely to see a slight weakening of its Country Risks score over the coming quarters.
Continued progress on the government's PPP programme and persistent growth rates in the worsening external environment indicates further upside potential to the country's rewards profile.
|Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
|Source: BMI Risk/Reward Index|
The Philippines 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 Philippines Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Philippine infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Philippines to test other views - a key input for successful budgetary and planning in the Philippine infrastructure market.
- Target business opportunities and risks in the Philippine infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Philippines.
- 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.