The European construction sector is set to grow in the coming years but will be stifled by world events according to new research.
Cautious growth of two per cent is set to return in 2012 rising to 2.5 per cent in 2013 according to Rider Levett Bucknall’s lastest European cost commentary report.
The findings confirm that there has been little change across Europe in construction costs across Europe over the last twelve months up to March 2011.
The majority of countries have reported either no change or else a fall of up to 5 per cent; notable exceptions are the Netherlands which is down by 11 per cent and Sweden which has increased by 15 per cent thanks to strong domestic demand and robust monetary stimuli.
During 2011, European construction output is predicted to fall by a marginal 0.1 per cent, the fourth successive year of contraction following falls of 3.4 per cent, 8.8 per cent and 3.3 per cent in 2008-2010.
The recovery looks set to be led by the countries of central and Eastern Europe, notably Hungary, Slovakia and especially Poland with the most troubled construction markets continuing to be Ireland and Spain, both of which are expected to see another year of double-digit declines in output.
Lance Taylor, chief executive of Rider Levett Bucknall said: “In the main, Europe has successfully emerged from recession, although the picture is very varied. In the UK, any stronger start we had to the year has most definitely slowed up.
“The coalition Government’s determination to reverse the public sector deficit within four years has led to deep and wide ranging cuts in government funding across all sectors which is having an inevitable impact.
“New VAT increases and the lending restrictions which the banks continue to operate have meant that commercial development in the UK has remained almost dormant this year with the only real signs of activity around London.
“However the general outlook for Europe is more positive with all countries in the EU, apart from Greece and Portugal, due to be out of recession in 2011.”
