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Building Activity in Europe: Following the Lull, Markedly Higher Growth Contributions Again

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  • Volker Rußig

Abstract

The 2002 state of the West European building industry may again be best described by the term “construction lull”, although it may have reached bottom. Next year, according to the projections of the EUROCONSTRUCT partner institutes, which met in Dublin for their 53rd EUROCONSTRUCT Conference on 6 and 7 June, the recovery will be reflected in a markedly higher annual growth rate. The outlook for 2004 show an even stronger increase in the West European building volume, at 2%, to around € 950 billion. Decisive for the economic recovery of the West European building sector is the expected end of the construction crisis in Germany. In the period 2001 to 2004, Germany has been by far the biggest brake on a faster expansion of the building volume; the other four big West European countries have contributed markedly to construction growth during this period. In Scandinavia and in the other smaller West European countries, the construction industry will continue to grow at varying speeds. According to EUROCONSTRUCT, the diverging tendencies in the various countries yield a recovery for Europe as a whole of the presently still weak building sector. As early as this year, building demand is expected to stabilise, and from 2003 much higher growth rates are likely. There will be no new building boom, however. Rather, a rather unhurried upward movement will set in. Anyway, the European building volume will reach a new peak at more than € 990 billion (almost +4% over 2001). The contribution of the building sector to aggregate European economic growth will rise to around € 18 billion in 2004.

Suggested Citation

  • Volker Rußig, 2002. "Building Activity in Europe: Following the Lull, Markedly Higher Growth Contributions Again," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 55(14), pages 27-36, July.
    • Handle: RePEc:ces:ifosdt:v:55:y:2002:i:14:p:27-36
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    References listed on IDEAS

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    1. Arbeitsgemeinschaft deutscher wirtschaftswissenschaftlicher Forschungsinstitute, 2002. "The State of the World Economy and the German Economy in Spring 2002," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 55(08), pages 3-30, April.
    2. Erich Gluch, 2002. "Only moderate growth for the building industry in this decade," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 55(05), pages 32-38, March.
    3. repec:ces:ifosdt:v::y:2002:i::p:5-19 is not listed on IDEAS
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    5. Hans-Werner Sinn, 2002. "Deutschland in der Weltwirtschaft - das Prinzip Hoffnung," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 55(13), pages 5-19, July.
    6. Arbeitsgemeinschaft deutscher wirtschaftswissenschaftlicher Forschungsinstitute, 2002. "Die Lage der Weltwirtschaft und der deutschen Wirtschaft im Frühjahr 2002," HWWA Reports 218, Hamburg Institute of International Economics (HWWA).
    7. Arbeitsgemeinschaft deutscher wirtschaftswissenschaftlicher Forschungsinstitute, 2002. "Die Lage der Weltwirtschaft und der deutschen Wirtschaft im Frühjahr 2002," Wirtschaft im Wandel, Halle Institute for Economic Research (IWH), vol. 8(5), pages 106-155.
    8. Volker Rußig, 2002. "New Residential Construction in Europe: Bottoming Out in 2002. Selected Results of the EUROCONSTRUCT Summer Conference 2002 in Dublin," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 55(13), pages 25-32, July.
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    1. Volker Rußig, 2003. "Continuing decline in housing completions in Europe," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 56(02), pages 11-19, January.
    2. Volker Rußig, 2003. "Construction activity in Europe: Anxiously awaited upswing Further results of the 54th EUROCONSTRUCT winter conference 2002," ifo Schnelldienst, ifo Institute - Leibniz Institute for Economic Research at the University of Munich, vol. 56(03), pages 11-22, February.

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    JEL classification:

    • L74 - Industrial Organization - - Industry Studies: Primary Products and Construction - - - Construction

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