Germany retards the upswing of Europe’s construction industry – selected results of the Euroconstruct 2005 summer conference

An increase of European construction output by more than 2% is already expected for the current year, as was the case in 2004. However, this growth will flatten again in the following years; for 2006 and 2007 it is forecast to be at 1½%. The Euroconstruct 2005 summer conference came to these results. The aggregated construction output of the 19 western and central European countries of the Euroconstruct region will increase by almost €65 billion or nearly 5½% between 2005 and 2007.In the assessment of the European construction experts, housing construction will likely overcome its weak phase, but the increase will remain restrained. While civil engineering will continuously improve throughout the entire projection period, non-residential construction will initially suffer strong setbacks, to be followed by a gradual and then strong improvement. This development will proceed quite differently in the 19 examined European countries. Especially Germany, with its initially shrinking construction volume (2005: -€4 billion, 2006: -€2.5 billion), will retard the all-over result, as indicated by the forecast of the Ifo Institute. Not until 2007 can Germany expect an increase of construction volume of approximately €2.5 billion. All included countries, except for Germany, look to an increase in construction volume – to varying degrees – in 2005 and 2006. In the other 18 Euroconstruct countries, without Germany, construction volume will expand at a slightly faster pace than the other components of the gross domestic product up to 2007.