Boston, MA -- (ReleaseWire) -- 07/28/2014 -- We are maintaining our expectation that Mexico's construction industry will return to growth in 2014 following a 4.5% contraction in 2013. Persistent delays in reviving public sector investment have seen us downgrade growth for 2014 and we now forecast 3% growth for the period. The recovery will gather pace in 2015, with 4.1% growth expected, as the MXN7.7trn National Infrastructure Plan filters through to activity on the ground in infrastructure and residential projects.
Infrastructure High On The Presidential Agenda
In April 2014, President Enrique Pe?a Nieto outlined a significantly expanded version of his National Infrastructure Plan, setting the new investment target at MXN7.7trn between 2014 and 2018.
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However, we remain concerned about institutional capacity and Mexico's ability to implement the programme given the poor precedent that was set during the execution of the previous plan. As such, we believe the next few months will be crucial in assessing the timeframe over which the NIP will revitalise the country's decimated construction industry and will thus refrain from revising up our five-year growth forecast for Mexico's construction sector.
Mexico's infrastructure sector has been stagnating over the past few years, and was further weakened by the lull in activity driven by public sector sluggishness in the wake of the transition of power in 2013. We expect this to turn around in H214, especially after a number of priority reforms came into law, which should allow more focus on other areas of the economy, with infrastructure likely to be a priority. Liberalising the energy and electricity sectors should allow for greater private sector investment into both.
Over the medium term we see the energy and utilities sector on track for the strongest growth, with average annual growth of 8.1% expected between 2014 and 2018. Growth is being driven by all three subsectors, including the development of pipelines bringing US natural gas to Mexico,...
The Mexico 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 Mexico Infrastructure Report provides industry professionals and strategists, sector analysts, investors, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Mexican infrastructure and construction industry.
- Benchmark BMI's independent infrastructure industry forecasts for Mexico to test other views - a key input for successful budgetary and planning in the Mexican infrastructure market.
- Target business opportunities and risks in the Mexican infrastructure sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Mexico.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. SWOTs, KPIs and latest activity).
BMI Industry View
Summary of BMI's key industry forecasts, views and trend analysis covering infrastructure and construction, regulatory changes, major investments and projects and significant multinational and national company developments.
These are broken down into Construction (social, commercial and residential), Transport (roads, railways, ports, airports etc), and Energy & Utilities (powerplants, renewable projects, pipelines and so on).
Analysis of latest projects across the infrastructure sector (covering the transport, utilities and commercial construction sub-sectors) - including:
Market Overview:Analysis of the key elements driving developments, including evaluations of current capacity and future requirements.
Building Materials Overview
The building materials overview provides industry trend analysis on the global and regional demands for building materials and the impact of this on the emerging and developed markets.
Business Environment Rankings
BMI's Infrastructure Business Environment Rankings provide a country-comparative Risk-Reward Rankings index aimed at investors (construction companies, suppliers and partners) in the regional infrastructure market.
The rankings methodology makes sophisticated use of over 40 industry, economic and demographic data point.
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