BMI's Executive Summary

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The South African construction industry has displayed impressive growth in the last few years and holds immense scope for future expansion. The forthcoming 2010 FIFA Football World Cup is expected to provide a tremendous boost to infrastructure development in the country. BMI expects the industry to grow at 6.14% during 2008-2012.

State-led projects in the areas of energy and transport infrastructure currently form the bulk of ventures in the construction industry. The government is also committed to the development of low-cost housing infrastructure. High levels of economic growth in South Africa and other emerging nations such as China and Russia are expected to boost activity at the country's ports. Furthermore, the 2010 World Cup has spurred hotel construction in South Africa. Major projects planned or currently under way include the construction of the Medupi and Matimba B power stations, the Coega Aluminium smelter in Eastern Cape, the Gautrain rapid rail link and the Ngqura deep-water port.

The South African construction industry is dominated by a few large players, which account for as much as 75% of the total output in the industry. The rest of the industry is rather fragmented. The country suffers from an acute shortage of skilled labour, limited access to power and inadequate financial and legal infrastructures, which have much scope for improvement. The industry is also excessively dependent on government contracts. Furthermore, the country may be under prepared for high growth, which may result in a shortage of building materials, including cement, in the coming years.

With less than 3% contribution to the country's gross domestic product (GDP), there is immense scope for growth in the South African construction industry. Despite all the risks, the industry is expected to be valued at ZAR94.80bn (US$9.97bn) by 2012, making up 3.31% of that year's GDP.

Contents

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Chapter 1 – Industry Trends And Developments

Market Overview

South Africa's Economy In 2006

South Africa's Construction Industry In 2006

Major Companies

Some Recent Investment Initiatives

Chapter 2 – Key Projects

Transport

Utilities

Steel And Cement Industries

Tourism

Residential And Commercial Construction

2010 Soccer World Cup

Table: South Africa — Major Infrastructure Projects

Chapter 3 – Business Environment

Introduction

Business Attractiveness Rankings — Methodology

Breakdown Of Ratings

Breakdown Of Components

Middle East And Africa Region

South Africa: Business Environment Ranking

Politics — Long–Term Risk

Economics — Long–Term Risk

Competitive Environment

Anticipated Sector Growth

Chapter 4 – SWOT Analysis

South Africa Infrastructure Industry SWOT

South Africa Economic SWOT

South Africa Political SWOT

South Africa Business Environment SWOT

Chapter 5 – Industry Forecast Scenario

Table: Economic And Construction data

Risks

Chapter 6 – Macroeconomic Outlook

Table: GDP, Output And Population

Chapter 7 – Competitive Landscape

Table: Key Players — South Africa Infrastructure Industry

Chapter 8 – Company Monitor

Aveng

Murray & Roberts Group

Group Five

Wilson Bayly Holmes–Ovcon

Chapter 9 – BMI Forecast Modelling

How We Generate Our Industry Forecasts

Construction Industry

Sources

Competitive Landscape for Middle East & Africa 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 Middle Eastern & African Infrastructure Sources

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BMI's Middle Eastern & African 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: