BMI View: Zimbabwe's construction industry remains highly risky for investors, poorly financed and subject to t he policies of President Robert Mugabe, which have resulted in a very poor business environment. Zimbabwe is keen to encourage foreign investment. H owever, so far China remains the only actor making inroads into the country - into the power and mining sectors.
We expect weak growth in the Zimbabwe construction industry as high risks, poor financing availability and dim growth prospects ward off investment, outside of Chinese state-sponsored projects.
As such, we forecast 2.5% real growth for 2016, with growth to remain fairly stable with an average of 2.5% over the course of our ten-year forecast period to 2025.
Zimbabwe Power Company (ZPC) expects to reach financial close by H216 for the USD1.1bn expansion of Hwange Thermal Power Station in the region of Matabeleland. The plant, which produces an average of 500MW, will have capacity to add 600MW to the national power grid once the expansion is complete.
The government announced in January that construction of the Batoka hydropower plant is set to start in 2017. The plant, to be built on the Zambezi River along the Zimbabwe-Zambia border, is a joint venture between the two countries. Feasibility studies for the scheme are expected to be concluded by June 2016. The World Bank is the primary financier of the project, which is expected to produce 2,400MW of electricity.
|e/f = estimate/forecast. Source: Zimstat, UN, BMI|
|Construction Industry Value, Real Growth, % y-o-y||2.13||2.52||1.94||2.06||2.17||2.29||2.40||2.80||2.91||3.01||3.11|
Within BMI's Sub-Saharan Africa Infrastructure RRI, Zimbabwe scores second worst among its regional peers - only slightly better than Sudan.
Zimbabwe receives an overall score of 23.8 out of 100, below the regional average for all indicators, with the lowest score for Country Risks.
|Geography||Risk/Reward Index||Rewards||Industry Rewards||Country Rewards||Risks||Industry Risks||Country Risks|
The Zimbabwe 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 Zimbabwe Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Zimbabwean infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Zimbabwe to test other views - a key input for successful budgetary and planning in the Zimbabwean infrastructure market.
- Target business opportunities and risks in the Zimbabwean infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Zimbabwe.
- 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.