Argentina Construction Market Size, Trend Analysis by Sector, Competitive Landscape and Forecast, 2023-2027

Argentina Construction Market Size, Trend Analysis by Sector, Competitive Landscape and Forecast, 2023-2027

Summary

GlobalData expects the construction industry in Argentina to shrink by 2.2% in real terms in 2023, owing to headwinds such as rising inflation and interest rates, rising construction costs, falling foreign exchange reserves, devaluation of the local currency, drought, and political uncertainty. Reflecting these challenges, there has been a sharp drop in the floor area of building permits. According to the National Institute of Statistics and Census of Argentina (INDEC), the total area authorized for building permits by 176 municipalities fell by 9.7% year on year (YoY) in the first six months of 2023, preceded by an annual decline of 9.3% in 2022. In a positive development, however, in late August 2023, the executive board of the International Monetary Fund (IMF) approved the disbursement of $7.5 billion in funding to Argentina, as part of its 30-month funding package, worth $44 billion, that was approved in March 2022; this brings the total disbursements to Argentina under the arrangement to $36 billion.

The Argentine construction industry is expected to rebound at an average annual growth rate of 3.1% from 2024 to 2027, supported by investments in transport, electricity, mining, Liquefied Natural Gas (LNG), and housing projects. In the recent months, several Chinese companies have announced investments in the country’s lithium sector. The Chinese miner Tibet Summit Resources, for instance, announced in late May 2023 that it will invest ARS414.9 billion ($1.7 billion) on developing two lithium projects - Salar Arizano and Salar de Diablillos - in Argentina. The two projects will collectively generate 50,000 to 100,000 tons of lithium. Moreover, Ganfeng Lithium, which is the world’s second largest lithium processor and third largest producer of lithium salts, pledged in June 2023 to invest ARS622.4 billion ($2.7 billion) on producing 74,000 tonnes of lithium carbonate in Argentina in the coming years. Forecast-period growth in the industry will also be supported by investments as part of the ‘Energy Transition Plan’ that was launched in late June 2023. The plan is estimated to cost ARS20 trillion ($86.6 billion) until 2030. Some of the targets announced as part of the plan include generating 57% of the country’s electricity from renewable energy sources by 2030; building 5,000km of new high-voltage electricity transmission grid lines by 2030; reducing energy demand by at least 8%, through energy efficiency and responsible energy use; achieving electric car penetration of 2% of the vehicle fleet by 2030.

The report provides detailed market analysis, information, and insights into Argentina's construction industry, including -

• Argentina'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 Argentina'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 Argentina. It provides -

• Historical (2018-2022) and forecast (2023-2027) valuations of the construction industry in Argentina, 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 GlobalData'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 GlobalData's critical and actionable insight.
• Assess business risks, including cost, regulatory and competitive pressures.
• Evaluate competitive risk and success factors.