View all newsletters
Receive our newsletter - data, insights and analysis delivered to you
  1. Comment
March 20, 2020

Construction in Africa hampered by China-related disruption

The coronavirus has been slow to take root in Sub-Saharan Africa (SSA), but the number of cases is now beginning to grow and the construction industry is facing disruption stemming from the China shutdown.

Free Report
img

Internet of Things set to transform the construction industry

The Internet of Things (IoT) is proving hugely beneficial to the construction industry, allowing different assets and people to be monitored and accounted for across a traditionally fragmented industry. As a result, companies that invest in IoT now promise to make long-term gains in the industry. According to GlobalData forecasts, spending on IoT in construction will reach $9.6bn by 2025. For an industry that has large sites to manage, strict project timelines, hazardous working conditions, and tight profit margins, IoT can create a manageable view of construction sites for project managers, streamline operations, and protect workers. In addition, it allows real-time data streams of assets, automates time-consuming tasks, and ensures employee safety and productivity. IoT integration with equipment manufacturing also has rich advantages for asset monitoring sensors. This, combined with artificial intelligence (AI) can help forecast materials and workers needed during the procurement stage and assist in forecast financing. Read GlobalData’s whitepaper to find out more, including information on:
  • IoT value chain
  • Market size and growth forecasts
  • Mergers and acquisitions
  • Leading IoT adopters in construction
  • Specialist IoT vendors in construction
Don’t get left behind – find out how IoT can fortify your operations and make investments now.
by GlobalData
Enter your details here to receive your free Report.

From imposing travel bans to barring mass gatherings and shutting down schools, governments across Africa are increasingly implementing comprehensive measures in a bid to control the spread of the new coronavirus. The emergency moves come amid a worrying rise in the number of infections registered in recent days across the continent after weeks of relatively few reported cases. As of 19 March, 33 African countries combined had reported more than 600 cases and 17 deaths due to the virus, 150 cases alone were reported in South Africa.

Amid the worsening situation with regards to the coronavirus outbreak, GlobalData has cut its forecast for SSA’s construction output growth to 5.4% in 2020, from 6.0% previously. Although the direct impact from the coronavirus has been limited to date, many countries in Africa are exposed to the knock on effects from the construction shutdowns in China.

In recent years, China has emerged not only as SSA’s largest trading partner but as a large and fast-growing source of aid and the largest source of construction financing; these contributions have supported many of Africa’s most ambitious infrastructure developments in recent years. As part of their increasing activity in overseas markets, Chinese companies have significantly boosted their engagement in Africa, covering a wide range of sectors. Africa is part of China’s ‘One Belt, One Road’ (BRI) initiative and with significant focus on coal and large hydropower projects.

The coronavirus outbreak presents a downside risk for short-term growth in the region, particularly in Ghana, Angola, South Africa, and Nigeria, which are reliant on China’s demand for their commodities exports. With mass production shutdowns and supply chain disruptions due to port closures in China, the effects are already being felt, while Africa’s access to industrial components and manufactured goods from the region has been hindered.

Construction companies have also suffered a lack of access to skilled personnel from affected regions, who have been unable to travel to project locations due to travel bans, quarantines and self-isolation, and this  will delay the completion of projects.

There is also a risk of a short-term dip in BRI related activity as the Chinese government evaluates its investment in the region and may opt to trim its investments in less critical markets. This adds more uncertainty to the region marred with widespread geopolitical and economic instability. On a more optimistic side, the African Continental Free Trade Area (AfCFTA) will effectively kick in July 2020, which should provide a boost to deal activity across the region.

Related Companies

Free Report
img

Internet of Things set to transform the construction industry

The Internet of Things (IoT) is proving hugely beneficial to the construction industry, allowing different assets and people to be monitored and accounted for across a traditionally fragmented industry. As a result, companies that invest in IoT now promise to make long-term gains in the industry. According to GlobalData forecasts, spending on IoT in construction will reach $9.6bn by 2025. For an industry that has large sites to manage, strict project timelines, hazardous working conditions, and tight profit margins, IoT can create a manageable view of construction sites for project managers, streamline operations, and protect workers. In addition, it allows real-time data streams of assets, automates time-consuming tasks, and ensures employee safety and productivity. IoT integration with equipment manufacturing also has rich advantages for asset monitoring sensors. This, combined with artificial intelligence (AI) can help forecast materials and workers needed during the procurement stage and assist in forecast financing. Read GlobalData’s whitepaper to find out more, including information on:
  • IoT value chain
  • Market size and growth forecasts
  • Mergers and acquisitions
  • Leading IoT adopters in construction
  • Specialist IoT vendors in construction
Don’t get left behind – find out how IoT can fortify your operations and make investments now.
by GlobalData
Enter your details here to receive your free Report.

NEWSLETTER Sign up Tick the boxes of the newsletters you would like to receive. The top stories of the day delivered to you every weekday. A weekly roundup of the latest news and analysis, sent every Monday. The industry's most comprehensive news and information delivered every month.
I consent to GlobalData UK Limited collecting my details provided via this form in accordance with the Privacy Policy
SUBSCRIBED

THANK YOU

Thank you for subscribing to Design Build Network