Slovakian construction sector "back on track" in 2010

Slovakia's construction sector is expected to grow again in 2010 following a -11.3% fall in output in 2009, according to market research company PMR's latest report, "Construction sector in Slovakia 2010 - Market analysis and development forecasts for 2010-2012".

Growth is expected to be spurred on by the government's focus on large infrastructure projects, said the report.

Ongoing and proposed projects that should prove "particularly lucrative for the industry", it added, include construction of the D1 motorway, R1 and R2 expressways, construction of bypass roads on the R4 and R3 expressways, a new broad-gauge railway line across the country, construction of the Bratislava railway tunnel, new nuclear and natural gas power stations, two airport expansion projects, a new national stadium and a new harbour, including a logistics centre.

The -11.3% fall follows a sustained period of growth in the country's construction output, which peaked at +12% in 2008.

The steepest reduction was seen in repair and maintenance work, said the report. There was also a -10.9% fall in the volume of new construction, modernisation and reconstruction, it added.

The slight increase in civil engineering work (+0.9%) was unable to counterbalance the steep decline in the construction of buildings (-15.1%).

There was a -50% year-on-year reduction in orders for new residential construction.

Activity in non-residential construction, which has traditionally been the most successful sector, was also "dented substantially" as demand for offices and retail space slumped.

The report said the least affected area was civil engineering, which grew by +17%.

The report concluded that " a major rebound will, however, be seen on the market only after sentiment has improved on the global financial markets and banks become more willing to grant loans for property development projects."