Romanian construction industry holds steady
By Sarah Ann McCay28 May 2013
Romania’s construction industry was flat in 2012, with just a 0.2% decline year-on-year, according to European market research and consulting company PMR.
The European country saw 2012 get off to a strong start, as its construction industry showed great promise, fuelled by an unusually warm winter, some encouraging corporate results from Q4 2011 and Q1 2012, and improving business sentiment among developers, according to PMR’s latest report ‘Construction sector in Romania 2013 – Development forecasts for 2013-2015’.
However, the market moved into the red in the second half of the year, following renewed concerns over the debt crisis in Europe. The country's political upheavals, which saw a referendum to suspend the president, three different Prime Ministers, and parliamentary elections held at the end of the year, also had a negative impact on the market.
Civil engineering construction strengthened its leading market position over the past four years. In 2012 the market was fuelled mainly by state investment, mostly related to the development of the country's transport infrastructure.
According to the National Institute of Statistics, in 2012 civil engineering construction output expanded by 2.9%. The segment was largely driven by road projects, as well as investments in renewables. Last year, 286 km of national road was renovated and 140.2 km of motorway. A further 230 km of motorway is to be put into use across the country in 2013.
PMR found that the non-residential construction market increased by 2.1% over 2011. In 2012, the best performing segment within non-residential construction was retail and services construction. However, 2012 saw investors secure the lowest number of non-residential construction permits in ten years.
The residential construction segment was the worst performing segment in Romania in 2012. According to the National Institute of Statistics, the segment contracted by 15.4% in 2012. The number of completed homes continued to decrease in 2012 by 6.3% reaching 42,566. This figure brought the market down to pre-2007 levels.