January 27 2020 0Comment

Mace predicts construction in sub-Saharan Africa to grow 7% in next two years

UK-headquartered consultancy Mace has predicted that construction activity in sub-Saharan Africa will grow at an average rate of 7% across the next two years.

Economic growth in the region will support construction development, but Mace notes that increasing domestic political and uncertainty government debt can curb public sector investments in infrastructure.

In a detailed market analysis, the firm breaks down the challenges and opportunities for each country in the area:

  • South Africa: The government aims to challenge corruption and modernise state-owned enterprises
  • Kenya: High levels of gross government debt will weigh on public sector investment, with private sector involvement sought for infrastructure project delivery
  • Ethiopia: Mace predicts a slowdown in industry expansion as work is completed on large infrastructure schemes
  • Rwanda: Expected to be one of the region’s best performers, with construction bolstering economic expansion
  • Tanzania: The country’s construction sector is due to be one a top performer, helped by long-term transport and power projects
  • Uganda: Mace suggests the construction sector is dependent on its ability to harness the economic potential of its oil reserves
  • Ghana: A stable government from the 2020 general election will help the market grow.

Kelvin Byres, Mace’s south and west Africa director, said: “The central outlook for construction activity across the region is cautiously positive but the overall conceals wide variation between nations. South Africa continues to face significant headwinds but the outlook for East and West Africa is brighter.

“In busier markets like Ethiopia, Rwanda and Ghana, there are big opportunities available for those willing to take risks. Developers should ensure that they are tailoring their procurement strategy to reflect localised capacity constraints. Earlier contractor engagement will also be key in delivering the best project outcomes.”

Mace recently released a North American market analysis that said labour shortages would push up cost inflation by a rate of 4%.

 

Source : www.globalconstructionreview.com

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