AUSTRALIA – CONSTURCTION & INFRASTRUCTURE
The construction industry is a major driver of activity in the Australian economy. It is made up of residential buildings, non-residential buildings, and engineering construction. It includes architectural and engineering services and construction trades such as bricklaying, plumbing, electrical, etc. Construction in Australia is primarily focused on the domestic market and is extremely fragmented with around 200,000 businesses, which represents 20% of the total number of companies in Australia.
After much market turmoil, the Construction industry in Australia has begun to stabilize in 2009-10 in line with improvements to the domestic and global economy. Engineering construction has grown over the year on the back of improvements to company profits, easier access to finance and the growing demand for commodities. At the same time, the increasing demand for commercial and residential property over the year has strengthened commercial building activity.
The Road and Bridge Construction industry benefited from the injection of additional Commonwealth funds as fiscal stimulus to support the general economy in the late 2000s. Investment into transport infrastructure has far-reaching, multiplier effects on the local and general economy; it also delivers improved efficiency and safety for commuters and the trucking industry. Government investment into new roads and bridges can both stimulate economic growth and open regions for new residential or industrial development.
Estimates indicate that revenue for the overall Construction industry in Australia will increase by around 2.1% to $28.5 billion by next year.
The Australian Government is committing $8.5 billion to 15 nationally significant infrastructure projects from 2008-09 to 2013-14.
Australia’s key industry figures for the Construction market (2009) are as follows:
Key Industry Figures | 2009 |
Industry Revenue | 278,989.8 $ million |
Revenue Growth | -2.6% |
Industry Gross Product | 75,332.2 $ million |
Number of Establishments | 388,534 Units |
Number of Enterprises | 355,324 Units |
Employment | 1,030,000 People |
Exports | -- |
Imports | -- |
Total Wages | 42,058.7 $ million |
Australia’s key industry figures for the Road and Bridge Construction industry are as follows:
Key Industry Figures | 2009 |
Industry Revenue | 15,900 $ million |
Revenue Growth | 21.4 % |
Industry Gross Product | 5,400 $ million |
Number of Establishments | 2,125 Units |
Number of Enterprises | 1,275 Units |
Employment | 41,000 Units |
Exports | -- |
Imports | -- |
Total Wages | 3,125 $ million |
Leighton Holdings Limited
Brookfield Multiplex Group
Downer EDI Limited
Roads and Traffic Authority of New South Wales
Roads Corporation
Leighton Holdings Limited
Valemus Australia Pty Limited
Downer EDI Limited
Boral Limited
Australia’s Construction industry continues to contract, with September marking the fourth consecutive month that construction activity has fallen. Construction in Australia continues to crumble in all sub-sectors according to the Australian Industry Group Australian Performance of Construction Index (Australian PCI) in conjunction with the Housing Industry Association. The Australian PCI fell 2.4 points in September to 40.8 (seasonally adjusted) remaining well below the critical 50-point level separating expansion from contraction.
Stock of Foreign Direct Investment in Australia by Industry:
Industry | $ million | % share of total |
Agriculture, forestry and fishing | 700 | 0.2 |
Mining | 99,659 | 25.4 |
Manufacturing | 73,848 | 18.8 |
Electricity, gas and water | 16,105 | 4.1 |
Construction | 13,037 | 3.3 |
Wholesale and retail trade | 57,093 | 14.5 |
Accommodation, cafes and restaurants | 914 | 0.2 |
Transport and communication | 25,929 | 6.6 |
Finance and insurance | 53,143 | 13.5 |
Property and business services | 33,830 | 8.6 |
Other services | 6,105 | 1.6 |
Unallocated | 12,500 | 3.2 |
Total | 392,862 | 100 |
The Australian Government's December 2008 and February 2009 announcements were designed to provide strong and decisive action to support jobs and insulate the Australian economy from the worst of the global downturn. These announcements, collectively known as The Nation Building - Economic Stimulus Plan (NB-ESP), make an unprecedented investment in Australia's long-term infrastructure needs and provide the jobs and capital funding to keep Australia's economy running. The Nation Building - Economic Stimulus Plan will help Australia's economic growth by providing major new funding for individual initiatives such as first home owners grants and solar hot water rebates; capital works programs including new science and language centers in 500 Australian schools; and significant infrastructure projects such as road and rail upgrades.
Recently, the Government established Infrastructure Australia to coordinate a national approach to Australia’s future infrastructure needs. The agency has completed an audit of the nation’s economic assets and identified key themes to drive development of Australia’s infrastructure. These include: broadband; energy grids: port productivity and land transport; public transport; and water supply. Continued strong demand, and an inability to meet all demand domestically, means the Government is keen for more foreign companies to enter the infrastructure development market, both to increase competition and relieve construction bottlenecks.
The Australian Constructors Association (ACA) is dedicated to making the construction industry safer, more efficient, more competitive and better able to contribute to the development of Australia, http://www.constructors.com.au.
The Housing Industry Association of Australia (HIAA) is the voice of Australia’s homebuilding industry, http://hia.com.au.
The Roadmaking Industry Association of Australia actively promotes awareness and professionalism throughout all levels of the Australian pavement delineation by advocating the benefits of professionally applied and maintained quality pavement delineation products and systems, http://www.riaa.com.au.
For current investment opportunities in Australia, please click here : http://investinaustralia.com/current-opportunities
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