In the second half of 2019, the nitrogen and PFAS issues were a key focus for the construction sector. Despite these issues, the construction sector showed growth of approximately 4 to 5% in 2019. In 2020, however, the construction sector is expected to start feeling the impact of the nitrogen and PFAS issues. The ABN AMRO expects construction output to contract by 2% in 2020 and for growth not to stabilise again until 2021. However, this contraction is not due to limited demand, but to limited supply from the construction sector. The impact is expected to be greatest for residential construction and civil engineering.
However, research by the ING It appears that, thanks to strong domestic demand, government measures and innovative solutions, construction output is expected to grow slightly by 0.5% in 2020. According to ING, the infrastructure sector will bear the brunt of the impact, due to the significant effects of the issues surrounding PFAS and nitrogen.
Two major banks have analysed the outlook for the construction sector in 2020, but what is an institutional organisation’s outlook for construction output in 2020 – positive or negative? On 22 January 2020, the EIB (Economic Institute for the Construction Industry) is holding its annual conference on the outlook for construction output and employment, this year covering the period 2020–2024. To provide our clients in the construction sector with the best possible guidance, VWG Corporate Finance will be attending this conference and will provide you with an update shortly.