Boston, MA -- (ReleaseWire) -- 05/29/2014 -- BMI View: Prolonged economic hardship in the eurozone sapped demand for Czech exports and greatly impacted the country's construction industry . P oor performance of the wider economy and a stream of negative official construction data has impeded the outlook for the sector. Although in the longer term a recovery is possible , it is likely to be turbulent and remain heavily exposed to broader macroeconomic trends. The cancellation of Czech utility CEZ's long-delayed tender for two new nuclear reactors is indicative of the unfavourable outlook for the power sector. That said, with an improving macro picture on the horizon for 2014 and continued support from European investors, we are forecasting positive growth to return in 2015.
Ke y Trends And Developments
The decline in the Czech Republic's construction industry has come on the back of ongoing economic pressures in the country, which has severely affected private investment and the government's ability to fund infrastructure projects.
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The following factors have shaped our overall bearish view for the infrastructure segment in the country:
- Transport Could See Funding Cuts : In September 2013, David Cermak, the head of the Directorate for Roads and Motorways (RSD) in the Czech Republic, indicated that the transport segment is likely to see significant budget cuts between 2014 and 2016. The RSD expects only CZK35bn to be allocated for transport during 2014, which will be followed by just CZK22bn and CZK4bn in 2015 and 2016 respectively. The RSD, however, hopes these figures will be revised to CZK33bn for 2014 and CZK25bn for 2015 under the new government.
- End To Renewable Energy Subsidy: It has been announced that the Czech Senate has passed into law a policy that will cut a number of state subsidies for developers of renewable energy projects in the country. Solar power projects received subsidies until end-2013, with hydro, biomass and wind developments only eligible if they are...
The Czech Republic Infrastructure Report features Business Monitor International (BMI)'s market assessment and forecasts covering public procurement and spending on all major infrastructure and construction projects, including transportation and logistics by land, sea and air; power plants and utilities, and commercial construction and property development. The report analyses the impact of regulatory changes and the macroeconomic outlook and features competitive intelligence on contractors and suppliers.
BMI's Czech Republic Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Czech infrastructure and construction industry.
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