Market Outlook

Southeast Asia’s Building and Construction Industry

• For 2010, Singapore’s Ministry of Trade & Industry has projected a GDP growth of 3-5%. Singapore expects to see a sustained level of construction demand over the next 2 – 3 years. BCA has projected that the value of construction contracts to be awarded in 2010 will be between $21 and $27 billion, and between $18 and $25 billion for 2011 and 2012.

• The Government of Malaysia during the 2010 budget reported that the construction industry recorded positive growth and has the potential to be further developed with the implementation of various Government development projects. In 2010, allocation totaling RM9 billion is provided to finance infrastructure projects including a provision of RM4.7 billion for road and bridge projects as well as RM2.6 billion for water supply and sewerage services; and, provision of RM899 million for rail facilities, RM820 million for ports and sea services as well as RM276 million for airport projects.

• Under Brunei’s Vision 2035 plan, $9.5 billion has been allocated for the National Development Plan up to 2012, where implementation of national development projects, public service facilities, caring for current infrastructure and public buildings will be carried out by the Ministry of National Development.

• The government of Indonesia has predicted Indonesia’s economy would grow by 7 percent in 2010 and the government plans to boost infrastructure and investment under the 7 billion U.S. dollars stimulus package which is used partly to finance huge infrastructure projects.

• With US$32 billion national budget proposed, the Philippines has projected strong construction sector growth in 2010 with prediction of expansion by 9.4% where overall, construction sector growth should remain positive at an average rate of 8.5% per annum across 2011-2014.

• Thailand’s government approval of US$5.9 billion for investments in infrastructure in the country’s provinces during 2010, is a part of the ‘Stronger Thai’ programme and is in turn part of the multi-billion-dollar infrastructure-geared stimulus plan. The funds will be allocated to projects focused primarily on infrastructure, which the government estimates could add about 1.3 percentage points to growth annually between 2010 and 2012.

• In Vietnam, infrastructure will make up an average of 48% of total construction industry value each year between 2009 and 2014. This is above the global average of 36.4%, indicating that investments in infrastructure in Vietnam will continue to dominate the construction sector. Where in 2010, real growth is forecast to be close to 28% and industry value is predicted to reach US$3.4 billion.