BMI's Executive Summary

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Venezuela's infrastructure sector has displayed double-digit growth in the last few years. Oil revenues form the mainstay of the Venezuelan economy and largely steer growth of all industries, including construction. BMI's newly released Venezuela Infrastructure Report 2008 forecasts the industry to grow at an average rate of 8.2% during 2008-2012.

Venezuela hosts large natural gas reserves and the present government–under the leadership of President Hugo Chavez–is promoting the country as a potential natural gas exporter. A number of pipeline construction projects with other South American nations are planned, or are currently underway. The Latin American nation suffers from a shortage of residential units, but the government has announced plans of constructing 85,000-95,000 residential units for the poor during 2007. Road and highway projects are also on the country's high priority list with approximately US$5bn likely to be spent on road construction up to 2009. Other projects include construction and expansion of refineries, power plants and petrochemical complexes. Furthermore, institutions such as the Andean Development Corporation have been providing financial assistance to Venezuela.

Excessive dependence on oil revenues makes the Venezuelan economy highly susceptible to global recessions and vulnerable to other external risks. The economy is also grappling with high levels of inflation. The overall financial infrastructure in the country–in spite of having improved in the last few years–continues to remain way below international standards. Corruption in the country has also touched record levels. The country's judicial system is also found to be lacking.

Despite all risks, BMI expects growth in the Venezuelan infrastructure sector to continue. The Venezuelan construction industry is forecast to be worth VEB70.48trn (US$21.87bn) in 2012, and contribute 10.73% to the country's Gross Domestic Product (GDP). Development of oil and natural gas related infrastructure holds immense potential. Increased levels of urbanisation and higher personal disposable incomes are also expected to propel growth.

Contents

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Executive Summary

Chapter 1 – Industry Trends And Developments

Market Overview

Venezuela's Economy In 2006

Venezuela's Construction Industry In 2005–2006

Major Companies

Some Investment Initiatives

Chapter 2 – Key Projects

Transport

Utilities

Cement And Steel Production

Residential And Commercial Construction

Table: Venezuela — Major Infrastructure Projects

Chapter 3 – Business Environment

Introduction

Table: Americas Business Rankings

Business Attractiveness Rankings — Methodology

Regional Overview

Venezuela: Business Environment Ranking

Economics — Long–Term Risk

Politics — Long–Term Risk

Construction Growth

Competitive Environment

Anticipated Potential

Chapter 4 – SWOT Analysis

Venezuela Infrastructure Industry SWOT

Venezuela Economic SWOT

Venezuela Political SWOT

Venezuela Business Environment SWOT

Chapter 5 – Industry Forecast Scenario

Table: Venezuela Infrastructure Historical Data and Forecasts

Risks

Chapter 6 – Macroeconomic Outlook

Table: Economic Activity Indicators

Chapter 7 – Country Snapshot: Venezuela Demographic Data

Section 1: Population:

Table: Demographic Indicators (2005)

Table: Rural/Urban Breakdown

Section 2: Education And Healthcare

Table: Education

Table: Healthcare: Vital Statistics

Table: Healthcare: Expenditure

Section 3: Labour Market And Spending Power

Table: Employment Indicators

Table: Consumption And Stratification

Chapter 8 – Competitive Landscape

Table: Key Players

Chapter 9 – Company Monitor

Otepi

Tecnoconsult

Vepica

Cemex Venezuela

Chapter 10 – BMI Forecast Modelling

How We Generate Our Industry Forecasts

Construction Industry

Sources

Appendix: Regional Demographic Data

Wages (ave per annum), US$

Population

Household Spending Per Capita, US$

Private Consumption Per Capita, US$ PPP

Market Size, GDP, US$bn

Competitive Landscape for Latin America 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 Latin American Infrastructure Sources

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BMI's Latin American 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: