A Global Forecast for Construction to 2030, published by Marsh and Guy Carpenter, written with Oxford Economics, a global leader in economic forecasting and analysis, was recently released. The report provides a view on the future of construction as the industry recovers from the unprecedented effects of COVID-19 and the key drivers shaping its future over the next decade.
 
Key findings about Asia:

• Global construction output sets to increase by 42% by 2030 with nearly half of the growth from Asia
• Global construction output is expected to grow by 6.6% in 2021 and by 42% by 2030, driven largely by government stimuli and the demand for residential construction. Three Asian countries – China, India and Indonesia accounts for almost half of the projected growth in construction in the next decade
• Near-term risk: The uncertainty caused by the spread of the delta coronavirus variant is one of the near-term risks. It is concerning Asia as most Asian economies are slower in rolling out the vaccines, resulting in extended restrictions on movement to cope with new outbreaks. Supply chain bottlenecks and labour shortages are also among the near-term risks.
• Longer-term risk: economic risks arise with elevated levels of debt to GDP ratios as it affects governments’ ability to fund infrastructural development. To address this challenge, a new wave of Public Private Partnerships is predicated, according to the report.

More Country-specific takeaways:

• China will move away from its previous growth model that emphasised heavy industry, infrastructure and investment, to consumer-led growth. This will mean more construction taking place in the nonresidential sector.
• India will overtake Japan as the third-largest global construction market by 2023. The country’s construction over the next decade will have two central drivers: demand for new homes and huge infrastructure needs. Need for new infrastructure is directly tied to the country’s growth trajectory.
• Indonesia: Indonesia is forecast to move up three places in the global top 10 construction markets, overtaking the UK and Germany as well as Japan to become the fourth-largest construction market in 2030.
• In Malaysia, the construction sector is expected to remain subdued in the short-term. It is expected to pick up in the latter half of the forecast period as excess capacity is gradually being absorbed amid still respectable economic growth