Romania's construction sector is expected to record solid growth across most sectors in 2017,supported both by domestic economic expansion and regional funding from the European Union (EU). Theexisting deficit in many sectors, including residential, transport and energy infrastructure, means thatdemand for new developments is high across the country. While a range of new projects have entered thepipeline, we do note rising political uncertainty has the potential to temper growth potential.
Forecast & Industry Developments
We are maintaining our forecast for 5.4% growth in the construction sector in 2017, followed by slowergrowth over the medium term. Upside risk does stem from efforts to improve the investmentenvironment, including changes to the public private partnership (PPP) structure.
In the energy segment, while coal power has long dominated the natural-gas sector is expanding. GeneralElectric as the provider of core technology for Romgaz's 430MW combined cycle power plant beingdeveloped at a cost of EUR268mn. Work is due to commence in late 2017 with the plant expected to becompleted in 2019.