The Croatian construction industry has grown in line with its economy in recent years, recording relatively stable growth during 2007 and 2008 due to substantial foreign direct investment (FDI) and public sector investment, and an increase in private residential mortgages. However, following this period of positive growth the construction industry recorded a huge decline: in 2010, the industry was valued at HRKXX.X billion (US$X.X billion), a decline of XX.X% from 2009. The Croatian construction industry has followed a similar trend to the European construction industry over the last few years, with smaller companies being able to adapt more easily to changing market conditions. As a result, there are growing numbers of small companies, while the number of large companies has dropped. Timetric expects the construction industry to record a CAGR of XX.XX% over the forecast period, as compared to the CAGR of XX.XX% recorded during the review period. The growth of the construction industry over the forecast period is expected to be fuelled by the infrastructure market, with a CAGR of XX.X%, and the commercial construction market, with a CAGR of XX.X%.
Construction in Croatia – Key Trends and Opportunities to 2015 Reference code: CN1009IR Published: July 2012 www.timetric.com www.timetric.com EXECUTIVE SUMMARY 1 Executive Summary The Croatian construction industry grew at a CAGR of 0.25% in the review period. The global financial crisis affected the Croatian economy badly, and its construction industry lost 6.0% in 2009 and a further 17.1% in 2010. In 2009, the country’s credit markets remained frozen because of the government’s refinancing needs, and as a result were unable to provide any stimulus to the market. In 2010, infrastructure construction was the largest market in terms of market share, accounting for a 48.6% share of the total industry. The market declined at a CARC of -2.40% over the review period, due to a lack of public investment. Market growth was largely affected by the decline in the sewage and water infrastructure categories, which recorded CARCs of -6.94% and -4.40% respectively. Before the financial crisis, the government of Croatia launched various schemes to encourage industries to set up plants in the country, but these projects were mostly cancelled or postponed as the financial crisis took hold in 2009. This resulted in the limited growth of the industrial construction market, which registered a CAGR of 3.26% over the review period, largely driven by growth in refinery buildings and waste processing plants with CAGRs of 16.41% and 5.54%, respectively. The commercial construction market grew at a CAGR of 1.54% over the review period, with growth largely driven by the retail and office building categories which grew at CAGRs of 3.76% and 2.62% respectively. Helped by the growing population, the residential construction market was the least affected by the credit crisis. The market grew with the highest review-period CAGR of 4.56%, led primarily by the residential building redevelopment and new multi-family housing categories with CAGRs of 8.14% and 4.25% respectively. The institutional construction market grew at a CAGR of 2.76% over the review period, with the institutional buildings and research facilities categories recording CAGRs of 8.53% and
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