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Construction in Nigeria – Key Trends and Opportunities to 2022

  • Executive Summary
  • Construction Outlook: At-a-glance
  • Latest News and Indicators
  • Key Drivers and Risks
    • Economic Performance
      • Table Nigeria, Key Economic Indicators
    • Political Environment
    • Demographics
  • Construction Outlook
    • All Construction
      • Outlook
      • Project analytics
        • Table Nigeria, Construction Output Value (nominal, NGN Billion)
        • Table Nigeria, Construction Output Value (nominal, US$ Million)
    • Commercial Construction
      • Outlook
      • Project analytics
        • Table Nigeria, Top Commercial Construction Projects by Value
    • Industrial Construction
      • Outlook
      • Project analytics
        • Table Nigeria, Top Industrial Construction Projects by Value
    • Infrastructure Construction
      • Outlook
      • Project analytics
        • Table Nigeria, Top Infrastructure Construction Projects by Value
    • Energy and Utilities Construction
      • Outlook
      • Project analytics
        • Table Nigeria, Top Energy and Utilities Construction Projects by Value
    • Institutional Construction
      • Outlook
      • Project analytics
        • Table Nigeria, Top Institutional Construction Projects by Value
    • Residential Construction
      • Outlook
      • Project analytics
        • Table Nigeria, Top Residential and Mixed-Use Construction Projects by Value
  • Key Industry Participants
    • Contractors
      • Table Nigeria, Key Contractors
    • Consultants
      • Table Nigeria, Key Consultants
  • Appendix
    • What is this Report About?
    • Definitions
      • Table Timetric Construction Market Definitions
      • Table Construction Risk Index Ratings and Scores
    • About Timetric
    • About CIC
    • Disclaimer

Synopsis

In real terms the Nigerian construction industry recovered in 2017 after registering a gloomy performance in 2016 due to the economic recession. Weak construction activity in 2016 came primarily on the back of high inflation rising unemployment currency devaluation high interest rates low oil prices and reduced oil production which forced the economy into recession; this reduced the pace of public and private sector investment in construction projects.

The industrym however gained pace in 2017 supported by government efforts to accelerate the pace of economic growth through increased investment in infrastructure projects. Overall the industry posted positive growth during the review period (2013–2017) registering a compound annual growth rate (CAGR) of 2.88% in real terms.

Over the forecast period (2018–2022) the government’s efforts to enhance transport and residential infrastructure will support the growth of the industry. The government’s aim to increase energy production capacity will support investments in energy infrastructure projects. The industry’s output value in real terms is expected to record a CAGR of 5.45% over the forecast period.

The overall expansion in the industry will be driven by the Economic Recovery and Growth Plan (ERGP) 2017–2020 under which the government aims to achieve sustained and inclusive economic growth. In line with its economic recovery plans the government announced budget spending of NGN8.6 trillion (US$26.3 billion) for 2018 – 15.8% higher than the 2017 budget. Accordingly the government allocated NGN2.4 trillion (US$7.4 billion) to capital expenditure an increase of 28.2% compared to the 2017 budget.

Summary

Timetric’s Construction in Nigeria – Key Trends and Opportunities to 2022 report provides detailed market analysis information and insights into the Nigerian construction industry including:

  • The Nigerian construction industry's growth prospects by market project type and construction activity
  • Critical insight into the impact of industry trends and issues as well as an analysis of key risks and opportunities in the Nigerian construction industry
Analysis of the mega-project pipelinefocusing on development stages and participants in addition to listings of major projects in the pipeline.

Scope

This report provides a comprehensive analysis of the construction industry in Nigeria. It provides:
  • Historical (2013-2017) and forecast (2018-2022) valuations of the construction industry in Nigeria
  • featuring details of key growth drivers.
  • Segmentation by sector (commercial industrial infrastructure energy and utilities institutional and residential) and by sub-sector
  • Analysis of the mega-project pipelineincluding breakdowns by development stage across all sectorsand projected spending on projects in the existing pipeline.
  • Listings of major projectsin addition to details of leading contractors and consultants
Reasons To Buy
  • Identify and evaluate market opportunities using Timetric's standardized valuation and forecasting methodologies.
  • Assess market growth potential at a micro-level with over 600 time-series data forecasts.
  • Understand the latest industry and market trends.
  • Formulate and validate strategy using Timetric's critical and actionable insight.
  • Assess business risks including cost regulatory and competitive pressures.
  • Evaluate competitive risk and success factors.
Key Highlights
  • Timetric expects the infrastructure construction market to retain its leading position over the forecast period with 29.9% of the industry’s total value in 2022. In order to develop the country’s rail infrastructure an agreement was signed in June 2016 between the government of Nigeria and China Civil Engineering Construction Company (CCECC) to construct a new coastal railway line connecting Lagos in the south-west and Calabar in the south-east of the country. The total investment in the project is anticipated to be NGN3.6 trillion (US$11.1 billion)and is scheduled for completion in 2019.
  • In April 2017 the government launched the ERGP 2017–2020 in order to support economic activitycreate employment opportunities and engender economic diversification. According to the government the total funding of NGN130.8 trillion (U$400.0 billion) is required to develop the country’s overall infrastructure by 2020 under the ERGP. Accordingly the government plans to borrow NGN9.8 trillion (US$30.0 billion) between 2017 and 2020 to develop infrastructure projects in the country.
  • Timetric expects the energy and utilities construction market output to record a forecast-period CAGR of 18.88% in nominal terms. Under the National Renewable Energy Action Plan (NREAP) the government aims to generate 30% of the country’s total electricity consumption through renewable sources by 2030. As part of the country’s vision to develop renewable energy the government awarded a contract to a consortium of Chinese state-owned construction companies in 2017 to construct the country’s largest hydroelectric power plant in the state of Taraba. The total investment for the 3,050MW hydroelectric power project is estimated at NGN1.9 trillion (US$5.8 billion) and is scheduled to be completed by 2023.
  • Timetric expects the residential construction market output to record a forecast-period CAGR of 10.82% in nominal terms. The government is focusing on developing affordable housing projects in order to address the country’s chronic housing shortage. Under the Family Homes Fund the government plans to construct 2.0 million social housing units by 2020 through public-private partnerships (PPPs).
  • The total construction project pipeline in Nigeria as tracked by the Construction Intelligence Center (CIC) including all mega projects with a value above US$25 million stands at NGN167.4 trillion (US$511.7 billion). The pipeline which includes all projects from pre-planning to execution is relatively well balanced with projects in the early-stage accounting for 48.9% of the pipeline by value as of April 2018.


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