Dublin, Aug. 11, 2023 (GLOBE NEWSWIRE) -- The "South Africa Construction Market Size, Trend Analysis by Sector (Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential) and Forecast, 2023-2027" report has been added to ResearchAndMarkets.com's offering.
The construction industry in South Africa is anticipated to decline by 1.9% in 2023 due to soaring energy prices and disruptions in the supply of key construction materials amid the Russia-Ukraine conflict. A fall in the total value of building plans passed in the country, combined with a drop in business activities, are additional contributing factors to this decline.
According to Statistics South Africa (Stats SA), the total value of recorded building plans passed by larger municipalities fell by 11.8% year on year (YoY) in the first four months of 2023. In terms of segmentation, it decreased the most for non-residential buildings by 27.7%, followed by a decline of 4% in residential buildings during the same period. The estimated decline in 2023 is also attributed to a decline in the business activities in the country. According to the Bureau for Economic Research, the seasonally adjusted average business activity index declined by 7.8% in the first five months of 2023, preceded by an annual decline of 3% in 2022.
The South African construction industry has been declining since 2016, but it will start to show some improvement in 2024, picking up from the low level of output in 2023, supported by investments in transport, renewable energy and water infrastructure projects. As part of the latest budget released in February 2023, the consolidated government spending will amount to ZAR7.1 trillion ($423.2 billion) from FY2023-24 to FY2025-26. Of the total, the major allocations are ZAR233.1 billion ($13.9 billion) on road infrastructure, ZAR121.3 billion ($7.3 billion) for water infrastructure and ZAR45.9 billion ($2.7 billion) for housing infrastructure during the same period.
Forecast-period growth in the industry will also be supported by investments as part of the South African Automotive Masterplan (SAAM) 2021-35, under which the government plans to increase South African vehicle production to 1% of global production by 2035, and increase local content in South African manufactured vehicles to 60% by 2035 - up from that of less than 40% in 2021. The construction industry's output will also be supported by the Mega solar power plant 5,000MW program, which the government is undertaking with an investment of ZAR20.1 billion ($1.2 billion). The construction works are expected to commence in Q3 2024 and end in Q4 2028.
The report provides a detailed market analysis of the South African construction industry, including its growth prospects by market, project type, and construction activity. It offers critical insight into the impact of industry trends and issues and provides an analysis of key risks and opportunities.
This report provides a comprehensive analysis of the construction industry in South Africa including:
- Historical (2018-2022) and forecast (2023-2027) valuations of the construction industry in South Africa, featuring details of key growth drivers.
- Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
- Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
- Listings of major projects, in addition to details of leading contractors and consultants
For more information about this report visit https://www.researchandmarkets.com/r/vyun3y
Source: GlobalData
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