Estonia Construction Market Size, Trend Analysis by Sector, Competitive Landscape and Forecast to 2027

Estonia Construction Market Size, Trend Analysis by Sector, Competitive Landscape and Forecast to 2027

Summary

GlobalData expects Estonia’s construction industry to shrink by 5.3% in real terms in 2023, owing to headwinds caused by elevated inflation rates, and decline in the number of new dwelling permits authorized in the country. According to Statistics Estonia, the total number of dwelling permits issued in the country fell by 34.1% year-on-year (YoY) in first two quarters of 2023, following overall annual declines of 22.9% in 2022 and 0.7% in 2021. As a leading indicator, the falling demand for building permits reflects falling confidence, owing to rising uncertainty in the national and global economy. Additionally, elevated construction costs are also likely to hold back investments on certain non-essential projects, and result in project delays in the short term. The continued constraints on supply chains are going to determine how viable projects are, in the short to medium term, as rising costs and delays mount. According to Statistics Estonia, the average Construction Price Index rose by 9.7% YoY in the first six months of 2023, owing to a rise in the prices of all three sub-components: building machines (12.6% YoY), buildings materials (10%) and labor (8.4%).

The industry is however expected to rebound at an annual average growth rate of 4.5% between 2024 and 2027, supported by investments in transport, renewable energy, green hydrogen, and telecommunication infrastructure projects. The Estonian government approved the 2024 Budget in September 2023. The budget includes an expenditure of EUR17.7 billion ($18.1 billion) in 2024, marking an annual increase of 4.9%. This includes an allocation of EUR7.5 billion ($7.7 billion) to the Ministry of Social Affairs; EUR1.5 billion ($1.53 billion) to the Ministry of Defence; EUR1.4 billion ($1.43 billion) to the Ministry of Economic Affairs; EUR1.1 billion ($1.12 billion) to the Ministry of Education, and EUR700 million ($714.8 million) to the Ministry of Regional Affairs. As part of the latest budget, the government reported that construction of the main corridor of the Rail Baltic railway line project will begin in 2024, with an investment of EUR216 million ($220.6 million).

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

• Estonia’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 Estonia’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 Estonia. It provides -

• Historical (2018-2022) and forecast (2023-2027) valuations of the construction industry in Estonia, 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.