Outlook for Europe’s construction sector remains bleak despite easing of lockdown measures

Western European construction output is expected to fall by 6.1% in 2020, in comparison to a previously expected expansion of 1.2% prior to COVID-19, says GlobalData, a leading data and analytics company.

Moustafa Ali, Economist at GlobalData, comments: “Governments across Europe originally responded to the virus outbreak by imposing strict lockdown measures, which resulted in the closure of construction sites. However, with the number of deaths and infected cases peaking in several European countries, governments started to ease lockdown measures, and construction activity in general is picking up. However, the weak economic outlook coupled with the possibility of a second virus outbreak are major downside risks for the sector.”

Construction activity across Eastern Europe slowed markedly in 2019, and in 2020 output will be severely impacted by COVID-19 containment measures, with output in the region set to contract by 3.3% in 2020.”

Ali adds: “While the virus has been largely contained by most countries in the region, the weaker economic outlook is set to constrain growth in the construction sector as construction works in several countries in the region have been severely disrupted because of the virus outbreak and the subsequent lockdown measures.”

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