Stagnation of the European Construction Industry to be Succeeded by Moderate Recovery Not Before 2003-04
Following the upward trend registered by the construction industry in Europe in the late 1990s (+3.5 percent in 1999, +2.5 percent in 2000), growth came to an abrupt stop in 2001, against the background of an overall economic downturn. Building production stagnated and is expected to grow at a very moderate pace (+0.5 percent) in 2002. A slight recovery is in view for 2003 (+1.5 percent), and should accelerate somewhat in 2004 (+2 percent). With these rates, the European construction industry will lag behind overall economic growth by about 1 percentage point per year. In Austria, the construction industry suffered more seriously, and a modest revival is projected only for 2003-04. The economic setback in western Europe and general doldrums among investors also put a critical check on investment dynamism in eastern Europe. In Central and Eastern Europe, the building volume in real terms shrank by 2 percent in 2001 and is expected to shrink again by 1 percent in 2002. It will be only in 2003 and 2004 that the construction industry in the CEECs should once again provide an impetus for the overall economy: for 2003, production is expected to grow by 3.9 percent, and the growth rate should reach fully 7 percent in 2004, due to greater infrastructural investments. The upturn of the European construction business, which had begun in 1999-2000, was halted by an overall economic slowdown. In some western European countries, the industry experienced a massive crisis in 2001. The country most affected was Germany, but building production also plummeted dramatically in Denmark, Austria, Belgium, the Netherlands, Norway and Finland. These countries will experience a decline in construction volume also in 2002, but growth should start again in 2003 and 2004. In eastern Europe, it was mainly Poland (by far the largest construction market) which went through a substantial crisis. Its real building volume fell by 7.8 percent in 2001, and is set to fall by another 5.5 percent in 2002. In Hungary, the construction industry is currently developing with great dynamism, and in the Czech and Slovak Republics a slack phase will be followed by an upturn as of 2002, which should accelerate in 2003-04, the consequence mainly of more investment in the infrastructure prior to the countries' accession to the EU. In 2001, the Austrian construction industry felt the crisis more strongly than the average of western European countries. Its real building production declined by about 3 percent. For 2002, the retrenchment is expected to be more muted (–1 percent). The decrease is due to a slump in new housing construction as well as the delaying of public infrastructure projects. It will take until 2003 for the construction industry to have a slight prospect of revival, due to greater emphasis on infrastructural investment. The industry's growth rate could be 1.5 percent in 2003 and 2004, respectively.
Baukonjunktur; Westeuropa; Osteuropa; Euroconstruct; Prognose; Österreich; Nach Stagnation der europäischen Bauwirtschaft leichte Erholung erst 2003/04; Stagnation of the European Construction Industry to be Succeeded by Moderate Recovery Not Before 2003-
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