Boston, MA -- (SBWIRE) -- 04/30/2014 -- The Croatian construction industry registered a compound annual growth rate (CAGR) of -9.64% during the review period (2009-2013). This was driven by a contraction in institutional and industrial construction, primarily due to a reduction in investor confidence following the European debt crisis. The industry is expected to improve slowly over the forecast period (2014-2018), supported by a general recovery in the economy and business confidence. The industry is anticipated to record a forecast-period CAGR of 3.41%.
- The Croatian construction industry remained weak following the global and European financial crises. In real gross value-added terms, the industry in 2013 was 57.0% its size in 2008. Despite this, the rate of decline has slowed and, with some stabilization in the area covered by building permits in 2013, the construction industry appears set for a period of recovery.
- A series of infrastructure projects will be launched to improve bridges, ports, roads, highways, airports, railways and power supplies. The Croatian government plans to invest HRK2.5 billion (US$436.5 million) in the construction and refurbishment of roads, HRK2.8 billion (US$488.9 million) for railways, HRK1.1 billion (US$192.1 million) for sea ports, HRK3.8 billion (US$663.4 million) for energy, and HRK127.0 million (US$22.2 million) for the combined heat and power (CHP) plant Sisak - Block C project.
- According to Croatia's Bureau of statistics, travel and tourism accounted for 15.0% of the country's GDP in 2012. With an aim to increase the sector's contribution, the government is focusing on the construction of new hotels and the expansion of existing ones. Overall, 12 large hotel projects, with a total room capacity of 2,900, are currently under construction. One such project is Split by Valamar Hotel Group, on which construction is expected to start by mid-2014. In 2013, the government also announced plans to invest HRK2.9 billion (US$506.0 million) in enhancing health tourism and eco-tourism on Bra?, an Adriatic island.
- In 2012, the industrial sector accounted for 25.0% of the country's GDP. Food, automotives, chemicals and pharmaceuticals are the sector's main segments, collectively employing 100,000 people. Stringent labor market regulations restricted the sector's competitiveness during the review period, due to the country's centralized system for the negotiation of wage agreements. High labor costs and low productivity are expected to restrict the volume of investments further.
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Companies Mentioned in this Report: Viadukt d.d., Hidroelektra Niskogradnja d.d., INGRA d.d., Strabag d.o.o., Osijek-Koteks d.d.
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