Construction in Ukraine continues to fall

Ukraine’s construction industry is set to record a 16% decline year-on-year in 2013, marking its fifth consecutive quarter of negative performance, according to European research company PMR.

This year's expected decrease follows a 8.3% drop in 2012. Between 2008 and 2013 the Ukrainian construction sector succeeded in expanding year on year in real terms only once - in 2011, when it posted double-digit growth. At its lowest point in 2009, the market saw a 40% decline year-on-year.

The third quarter of 2013 was the fifth consecutive quarter of negative year-on-year performance in construction as the government and local administrations revised downward planned spending on many civil engineering projects.

Between the first quarter and the third quarter of 2013, new construction and reconstruction accounted for 81.7% of total construction output, while maintenance was responsible for 7.5% of and overhaul activities for 10.8%.

In January to October 2013, only six of Ukraine’s 27 administrative areas saw an increase in construction activity. During that period, construction output dropped 15.1% year-on-year in real terms.

PMR said the contraction was mainly within the civil engineering construction sector, where output dropped 20.1% year-on-year.

The non-residential sector also performed poorly, with output falling 16.9% short of that achieved during the first ten months of 2012. However, the residential construction segment managed 8.8% year-on-year growth.