Press Release
- European Construction Industry Set for Revival with Saudi Arabia Driving Regional Growth
- Bain & Company Predicts European Construction Recovery, Highlights Saudi Arabia’s Expansion Opportunities
- Recovery on the Horizon: Europe’s Construction Sector Gains Momentum, Saudi Arabia Offers Bright Prospects
- European Construction Markets See Growth Potential Amid Saudi Arabia’s Development Boom
Riyadh:
Europe’s construction industry is set to rebound in 2025 after a two-year downturn, according to Bain & Company’s latest Building Blocks Construction Indicator. The report highlights Saudi Arabia as a key growth market, offering promising opportunities in infrastructure and residential development.
Bain projects a gradual recovery in Europe, driven by a revival in infrastructure investments, residential construction, and demand for sustainable office spaces. These sectors are expected to fuel growth as inflationary pressures ease and material supply chains stabilize, following what Bain termed a “perfect storm” of high costs and labor shortages in recent years.
The recovery will be uneven, with countries like Italy and the Nordics leading the way. Infrastructure investments are forecast to grow at annual rates of 2.5%-4.5% in Italy and the Nordics, and between 1.5%-3.5% in Germany, supported by government budgets targeting ageing assets, energy grid modernization, and the expansion of fiber optic networks.
Residential construction is also poised to recover strongly in France and the Nordics, with expected growth rates of 5%-7% and 6.5%-8.5%, respectively, between 2025 and 2027. However, Italy is forecast to see further contraction due to the aftereffects of a recent construction boom.
In Saudi Arabia, Bain anticipates compound annual growth of 3.5%-4.5% through 2026, driven by infrastructure expansion and a government push for homeownership. Commercial development is also set to thrive, propelled by the Kingdom’s efforts to position itself as a leisure and tourism hub.
“Saudi Arabia’s strategic focus on infrastructure, housing, and tourism aligns with global trends in sustainable and modern development,” said Dr. Houssem Jemili, Senior Partner at Bain’s Middle East practice.
Office construction in Europe is expected to grow, bolstered by stringent sustainability standards and the demand for state-of-the-art workspaces. The Nordics and the UK are predicted to see annual growth rates of 2.5%-4.5% and 1.5%-3.5%, respectively, during 2025-2027.
While challenges remain, Bain’s analysis underscores a pivotal turning point for the European construction sector, buoyed by favorable economic conditions and targeted investments in modernization.
***********************************************************
Readers
These are extraordinary times. All of us have to rely on high-impact, trustworthy journalism. And this is especially true of the Indian Diaspora. Members of the Indian community overseas cannot be fed with inaccurate news.
Pravasi Samwad is a venture that has no shareholders. It is the result of an impassioned initiative of a handful of Indian journalists spread around the world. We have taken a small step forward with the pledge to provide news with accuracy, free from political and commercial influence. Our aim is to keep you, our readers, informed about developments at ‘home’ and across the world that affect you.
Please help us to keep our journalism independent and free.
In these difficult times, running a news website requires finances. While every contribution, big or small, will make a difference, we request our readers to put us in touch with advertisers worldwide. It will be a great help.
For more information: pravasisamwad00@gmail.com