BMI's Executive Summary

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The Romanian construction industry contributed an estimated 5.95% to gross domestic product (GDP) in 2006 and was valued at US$7.43bn. Though the Romanian construction industry is small by European standards, the rapid growth has attracted several foreign and local companies to invest in the construction sector. This report forecasts the Romanian construction industry to grow, on average, 8.4% annually during the 2008-2012 period. The European Bank for Reconstruction and Development (EBRD) and the Luxembourg based European Investment Bank (EIB) are increasingly financing government and private projects in the construction industry. The International Monetary Fund (IMF) has forecast that the country will benefit from enhanced foreign investment flow.

The government is trying hard to achieve European standards for its industries. For instance, the Romanian Ministry of Environment and Water Management is seeking to align Romanian environmental standards with European standards. A number of major infrastructure projects have been planned or are under way in Romania. They include the Bucharest-Brasov motorway valued at US$3.05bn, Turkish company Opus Project&Development's construction of a residential complex in Stefanestii de Jos village, valued at US$968.06mn and River Invest's residential and commercial complexes in Bucharest worth US$943mn. Foreign companies such as Spain-based Imobiliare and Fadesa, Hungarian TriGranit, French Bouygues, Italian Italstrade and Austrian Strabag all have a strong presence in the Romanian construction industry. New companies such as General Electric (GE) and AFI Europe are entering Romania to take advantage of the growth potential of the economy.

However, a number of risks could hamper the growth of the construction industry. For instance, a labour shortage due to relatively higher wages offered outside the country is a major concern for the continuation of growth in the industry. A rising budget deficit might have an increasingly adverse impact on the availability of funds for the infrastructure sector and on the economy in general.

Despite these risks, BMI forecasts that the construction industry will grow by 11.33% year-on-year (y-oy) in 2008. The construction industry is forecast to reach a value of US$18.95bn by 2012, from an estimated US$12.91bn in 2008.

Contents

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Chapter 1 – Industry Trends And Developments

Market Overview

Romania's Economy In 2006

Romania's Construction Industry In 2007

Major Companies

Some Recent Investment Initiatives

Chapter 2 – Key Projects

Transport

Utilities

Tourism

Residential And Commercial Construction

Table: Romania — Major Infrastructure Projects

Chapter 3 – Business Environment

Introduction

Business Attractiveness Rankings — Methodology

Breakdown Of Ratings

Breakdown Of Components

Regional Overview

Romania: Business Environment Ranking

Politics — Long–Term Risk

Structural Economic Risk

Competitive Environment

Anticipated Sector Growth

Chapter 4 – SWOT Analysis

Romania Infrastructure Industry SWOT

Romania Economic SWOT

Romania Political SWOT

Romania Business Environment SWOT

Chapter 5 – Industry Forecast Scenario

Table: Romania — Infrastructure Industry Forecast

Risks

Chapter 6 – Macroeconomic Outlook

Table: GDP Output And Population

Chapter 7 – Competitive Landscape

Table: Romania — Key Players

Chapter 8 – Company Monitor

Bouygues Romania

Holcim Romania

Alstom

Strabag

Chapter 9 – BMI Forecast Modelling

How We Generate Our Industry Forecasts

Construction Industry

Sources

Competitive Landscape for Europe Infrastructure Reports: Sample of Companies Ranked

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Comparative company analyses and rankings by sales, % market share, employees, registration date and ownership structure. Company profiles include fully researched senior executives and contact details, business activity and leading products and services. SWOT (strengths, weaknesses, opportunities, threats) of the state’s business environment, infrastructure sector, politics and economics, which carefully evaluates the short- and medium-term issues facing the industry.

Network of European Infrastructure Sources

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BMI's European Infrastructure Reports are based on an extensive network of multilateral organisations, government departments, infrastructure industry associations, chambers of commerce and company reports. Information sources include: