ARTICLES LABELLED WITH TAG EECFA

High inflation and rising interest rates seem to have bitten in overall consumption. And although Serbia is likely to avoid recession in the short run, its real GDP growth is estimated to be a moderate 2%-4% this year and next with a downside risk being the looming recession in the EU. The rental housing market has been supported by the Russian and Ukrainian citizens settling down in Serbia, keeping rent rates high. Housing construction is still strong and although the volumes in building construction are already consolidating, big infrastructure projects could sustain civil engineering on all-high levels in the mid-term, according to Dejan Krajinović (Beobuild Core d.o.o.) at EECFA which conducts research on the construction markets of 8 Eastern-European countries, including Serbia.

The composition of Croatia’s construction output is changing. While the residential segment may soon experience a slowdown, health-related construction - public and private renovations and new builds alike - is seeing a considerable boom, write Michael Glazer (SEE Regional Advisors) and Tatjana Halapija (Nada Projekt), Croatian members of the EECFA (Eastern European Construction Forecasting Association).

While the costs of construction materials in Romania rose during 2022, impacting the ability of developers to self-finance their projects, the current outlook is not pointing towards an improvement of this situation this year, according to an analysis by the Eastern European Construction Forecasting Association (EECFA).

The EECFA 2022 Winter Construction Forecast Report has been released and yet another downward revision characterizes the forecast for both Southeast Europe and Eastern Europe. Southeast Europe could see shrinkage on the horizon. This, however, comes after a great period of construction between 2016 and 2021, so the market is foreseen to come down from a peak level. In this respect, the 3% decline until 2024 is no drama, in EECFA’s view. The drama is in East Europe where the peak was reached in 2018 and the market was around 10% below that peak level even before the Ukraine war began. Since then, EECFA has paused issuing forecasts in Ukraine and a status report has been prepared. Without Ukraine, the region is expected to reach its bottom in 2023.

Bulgaria’s Recovery and Resilience Plan (RRP) aims to facilitate economic and social recovery from the COVID-19 crisis and to create a more sustainable, equitable, and successful economy. It includes a set of schemes not only to restore the economy's growth potential but to boost it, too. In achieving this, several construction projects to increase energy efficiency and decrease CO2 impact are to be implemented in 2023-2026, says Anita Dangova at EPI, EECFA’s Bulgarian research institute.

Previous optimism over the prospect of the construction market in the Southeast European region is gone, the Eastern European Construction Forecasting Association (EECFA) reports. The current forecast is foreshadowing almost no growth until 2023 and contraction in 2024. The main reason behind is the worsening climate for construction due to the consequences of the Russian invasion of Ukraine.

According to Yasen Georgiev from EPI, EECFA Bulgaria, like elsewhere in the EECFA countries that are not directly impacted by the war in Ukraine, the construction market in Bulgaria entered a period of an increasing unpredictability. What stands behind is an interplay between domestic and external factors.

Serbia’s construction market was booming when the economic and geopolitical situation changed, so the complicating circumstances in the world are stifling the potential growth and slowing down the ongoing recovery. Inflationary pressures have exploded with the start of the war in Ukraine and the effects of the current crisis are still unforeseeable, writes Dejan Krajinović from Beobuild Core d.o.o. for EECFA Serbia.

For Croatia, as for other EECFA countries, the Russian invasion of Ukraine has been both a supply shock and a demand shock. And many of the elements of these shocks are the same for Croatia as for other EECFA countries. On the supply side, energy costs are rising as are the costs of construction materials and of construction finance. Supply chains and labour markets have also been disrupted. On the demand side, inflation has cut into consumers’ real disposable income, consumer confidence has been shaken as a result and finance for real estate purchases has become more expensive, says Michael Glazer, SEE Regional Advisor at EECFA Croatia.

Romania’s trade relations with Ukraine, Russia and Belarus are limited, but the country has been importing raw materials from these countries that are used in the local construction market, according to an analysis by the Eastern European Construction Forecasting Association (EECFA).