Construction in Peru Set to Reach US$36.6bn in 2023 as it Gathers Growth Momentum
Peruvian construction industry’s output value was estimated to be US$28.7bn in 2018. This is expected to grow to US$36.6bn in 2023 (measured at constant 2017 US dollar exchange rates), close to an annual rate of 5%, according to GlobalData.
Following two years of contraction, the Peruvian construction industry recovered in 2017 and registered growth of 2.4% in real terms in 2017 and by a further 4.5% in 2018. This latest report: ‘Construction in Peru – Key Trends and Opportunities to 2023’ states that this increase was due to positive developments in economic conditions, a revival in investor confidence and investments in transport infrastructure, energy and housing construction projects.
Danny Richards, Lead Economist at GlobalData, comments: “The industry’s output value is expected to continue to expand between 2019 and 2023, with investments in infrastructure, health and education, and housing projects continuing to drive growth.”
This has already been reflected in the rise in construction permits. According to the National Institute of Statistics and Informatics (INEI), the total construction permits issued in the country grew by 13.0% in 2018.
Infrastructure construction is expected to increase in importance over the forecast period, to account for just over 29% of the industry’s total value in 2023. Growth over the forecast period is expected to be supported by the government’s plans to develop transport infrastructure in the country, with an aim to reduce traffic congestion.
Richards adds: “The total construction project pipeline in Peru – as tracked by GlobalData, and including all mega projects with a value above US$25m – stands at US$126.1bn. The pipeline, which includes all projects from pre-planning to execution, is relatively skewed towards early-stage projects, with 64.7% of the pipeline value being in projects in the pre-planning and planning stages as of February 2019.”
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