The value of the construction industry in Thailand is forecast to increase by US$ 2.5 billion by 2019, despite its recent poor performance, says a new report.
Research from Timetric, reveals the industry saw growth of -0.23% over the forecast period (2010 to 2014).
According to the report, however, the increasingly stable political and economic outlook is encouraging new investments in residential, infrastructure and commercial construction projects.
Due to these more favourable circumstances, Timetric forecasts an increase in the value of the Thai construction industry from US$17.4 billion in 2014 to US$19.9 billion in 2019 in real terms, at an annual growth rate of 2.79%.
A construction activity breakdown shows residential construction to be the largest sector, at 37% of the industry’s total value, followed by infrastructure construction at 24.6%.
The primary drivers of growth are said to be increased demand for housing, government investment in public infrastructure and a general move to economic expansion.
Construction activity should also be boosted by tax incentives put in place by the Thai government, aimed at encouraging foreign investment into agriculture, renewable and alternative energies, IT and tourism.
The government has initiated a THB 2.4 trillion (US$ 75.0 billion) national development plan, aimed at the development of Thailand’s road, rail and port infrastructure, and running up to 2022.
While the Timetric report’s analysis forecasts a positive outlook for construction in Thailand, up to and beyond 2019, it also indicates that continuing uncertain economic conditions, along with a lack of modern transport infrastructure and a shortage of skilled labour, could hamper growth.