MANILA, Philippines — The Philippines is expected to be among the fastest growing construction markets over the next 15 years globally, according to UK-based think tank Oxford Economics and Aon Global Construction and Infrastructure.
In a report, Oxford Economics and Aon said the Association of Southeast Asian Nations (ASEAN) tiger economies such as the Philippines, Vietnam, Malaysia and Indonesia as well as India and Bangladesh are seen to be the world’s fastest growing construction markets over the next 15 years.
“The combined growth of the fastest ASEAN economies plus India and Bangladesh is expected to be $800 billion over the next 15 years –twice the growth of construction work done in the US over the same period,” Oxford Economics and Aon said.
The rising populations as well as rapid urbanization and low average earnings per head of population in these markets are expected to fuel construction growth.
Oxford Economics and Aon said growth in the Philippines, Vietnam and Indonesia would be supported by strong fundamentals.
“The Philippines is set to be the fastest growing construction market over the next 15 years, averaging over six percent growth per annum,” Oxford Economics and Aon said.
Economic growth in the country is expected to be supported by the working age population, which is seen to increase by 1.5 percent per annum over the next decade.
Oxford Economics and Aon said the government’s push for public-private partnerships (PPPs) for infrastructure development is seen to drive construction growth in the country.
“The government’s PPP initiative and improved long-term investor confidence are set to support investment - and therefore construction activity - over the forecast period,” they said.
They also said civil infrastructure is expected to be the fastest growing sector, with support from the government.
Given the tight fiscal space, National Economic and Development Authority (NEDA) Secretary Arsenio Balisacan earlier said that the government is looking at PPPs for the implementation of infrastructure projects.
Last March, the NEDA Board chaired by President Marcos approved the list of infrastructure flagship projects (IFP) worth P9 trillion, which are to be prioritized under the government’s annual budget preparation and go through expedited approval processes consistent with current legal frameworks.
Balisacan said 45 of the 194 IFPs would be financed through PPPs.