Construction in Ukraine - Key Trends and Opportunities (H2 2021)

The construction industry in Ukraine was not affected by the COVID-19 crisis to the same extent as other markets in Europe. Ukraine’s construction industry grew by 5.2% in real terms in 2020, following annual growth of 23.9% in 2019. The analyst expects the construction industry continued to expand in 2021, growing by 2.6% in real terms, driven by continued investment to improve country’s infrastructure, coupled with increased spending in health and education sector. According to Ukrainian Prime Minister Denys Anatoliyovych Shmyhal, between 2020-2021, 10,000km of roads, 560 bridges, 400 schools and kindergartens, 25 swimming pools, 193 stadiums, 201 emergency departments and 600 rural clinics were either built or renovated.

The industry is expected to grow at an annual average rate of 8.2% between 2022 and 2025, supported by the government’s investment on the development of transport infrastructure, energy and utilities and industrial construction projects. In the 2022 state budget, a record UAH141.8 billion (US$5.1 billion) has been allocated for the development of infrastructure. These funds will be directed to the reconstruction, construction, and maintenance of roads of state and local importance, as well as the modernization of railroads, airports, and river transport. The government also increased it spending towards health and education sector for 2022. Moreover, in July 2021, the government announced plans to build 25 state-funded industrial parks over the next three years, which is expected to attract more foreign investors into the country.

In June 2021, an agreement was signed between Ukraine and the World Bank worth UAH9.8 billion (US$350 million) for the systemic project Development Policy Loan for Economic Recovery (DPL). The plan is to implement COVID-19 measures, finance the state budget and support economic development. In December 2021, the Minister of Finance of Ukraine Sergii Marchenko and the World Bank signed another loan agreement worth UAH10.2 billion (US$365 million) to continue the implementation of economic recovery projects (Second Economic Recovery Development Policy Loan - DPL). As part of further support to Ukraine, the World Bank's Country Partnership Strategy for 2022-2025 is being developed with the aim of achieving sustainable economic recovery and growth in Ukraine. The priority areas of the strategy will be the energy and agrarian sectors, and the transport system.

In December 2021, the government revealed plans to double Ukraine's GDP over the next 10 years. For this, Ukraine expects to receive almost UAH181.7 billion (US$6.5 billion) in investments in infrastructure in the coming years, which will be based on public-private partnerships and thereby support the construction industry over the forecast period. However, a recent global surge in virus cases in early November 2021 and subsequent restrictions is expected to weigh on the industry’s output in the remainder of 2021 and early 2022.

This report provides detailed market analysis, information, and insights into Ukraine’s construction industry, including:

• Ukraine’s construction industry's growth prospects by market, project type and construction activity
• Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in Ukraine’s construction industry
• Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.

Scope

This report provides a comprehensive analysis of the construction industry in Ukraine. It provides:

• Historical (2016-2020) and forecast (2021-2025) valuations of the construction industry in Ukraine, featuring details of key growth drivers.
• Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
• Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
• Listings of major projects, in addition to details of leading contractors and consultants

Reasons to Buy

• Identify and evaluate market opportunities using the analyst's standardized valuation and forecasting methodologies.
• Assess market growth potential at a micro-level with over 600 time-series data forecasts.
• Understand the latest industry and market trends.
• Formulate and validate strategy using the analyst's critical and actionable insight.
• Assess business risks, including cost, regulatory and competitive pressures.
• Evaluate competitive risk and success factors.