Thursday, 07 April 2016 14:30

Low growth environment reduces sector confidence

As spending slows consulting engineers' confidence has plunged to 36%, matching the business and construction outlooks. Short to medium term improvement is not expected. The industry is inclined to adapt to a low-growth environment as infrastructure spending was been hampered by poor economic growth, lower-than-expected revenue by government, international economic instability and price volatility. This is in spite of pending projects under the country's National Development Plan (NDP).

  • After rising marginally to 42 in 2015Q4, the FNB/BER Civil Confidence Index fell by 14 points in 2016Q1 to 28. This is the lowest level for the index since 2011Q4.
  • The results from the civil contractor survey suggests that construction activity slowed noticeably during the quarter along with a marked uptick in tendering price competition
  • According to the South African Reserve Bank‚ growth in the real value of construction works rose 4% year on year in the fourth quarter of last year from 3.7% in the third quarter