Zambia Construction Market Size, Trend Analysis by Sector (Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential) and Forecast, 2023-2027

Zambia Construction Market Size, Trend Analysis by Sector (Commercial, Industrial, Infrastructure, Energy and Utilities, Institutional and Residential) and Forecast, 2023-2027

Summary

Following an annual decline of 7.3% in 2022, Zambia’s construction industry is expected to shrink further by 3.6% in real terms this year, owing to weak investor confidence coupled with the government’s poor financial position and high public debt levels. According to the Secretary to the Treasury, the country’s central government external debt-to-GDP ratio increased from 39.8% in 2021 to 44.7% in 2022. In addition, the proposed spending for the country's 2023 budget, which was presented in September 2022, was cut by 3.3%, from ZMK173 billion ($10 billion) in 2022 to ZMK167.3 billion ($9.7 billion) in 2023. Moreover, according to the Ministry of Finance, the total value of loans provided to the private sector for the construction industry declined by 12% in 2022, which indicates a slowdown in construction activity in 2023 and a decrease in the demand for construction labor and materials.

The expected decline in 2023 is also attributed to cancellations and delays of energy projects. Luapula Hydro Power Corporation’s ZMK7 billion ($400 million) project to construct a 101MW hydroelectric power plant at Kundabwika Falls on the Kalungwishi River was put on hold in February 2023 due to ownership issues. The Zambian construction industry is however expected to pick up from 2024, supported by investments in the transport infrastructure, energy, mining, and manufacturing sectors. As part of the 2023-2025 Medium Term Budget Plan, with objectives aligned with the Eighth National Development Plan (8NDP) 2022-26, the government allocated a total amount of ZMK2.8 billion ($159.6 million) in August 2022 to promote investment and expansion in all the sectors and also focus on shifting towards renewable energy, with a focus on boosting solar and geo-thermal energy sources in the country.

The forecast-period will also be support by an estimated decline in the debt-to-GDP ratio. According to International Monetary Fund (IMF), Zambia’s debt-to-GDP ratio is expected to fall from 133% of GDP in 2021 to 104.7% by 2025. In addition, U.S. Vice President Kamala Harris asked China in March 2023 to write-off Zambia's debt to express support for Zambia and has also vowed that US will support the country by the end of 2023 in strengthening its economy and get the country relieved from debt. As part of Sustainable Development Goal 7 (SDG7), the country is focusing on increasing urban electrification from current 68% in 2021 to 100% in 2030 and rural electrification from 4.5% in 2021 to 50% in 2030.

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

• Zambia’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 Zambia’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 Zambia. It provides -

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