Real Estate

Construction and Infrastructure: Unprecedented challenges of the changing economy

The last three years have seen dramatic changes in the construction and infrastructure sectors.  Businesses across many parts of the globe have faced unprecedented challenges arising from an unfavourable combination of circumstances. Rising raw materials prices, lack of availability of funding, corporate failures arising from the inappropriate management of risks, Government spending cuts and weak consumer spending are just some of the factors businesses have had to contend with, not to mention the pressures brought about by new accounting standards and other regulations.

In looking to the future, the emerging markets will continue to experience transformational changes in economic performance compared with the established world order, with countries such as China and Brazil in the front row.  Although the developed economies are likely to make significant demands in areas such as utilities provision and infrastructure renewal, the major growth nations are likely to be those where the principal opportunities for big-ticket commercial and infrastructure development will arise.  The multi-national operators in particular, must look to move with these trends through both consolidation and diversification.

Ernst & Young has an unrivalled client base across the sector. In the recent past the priority has been one of weathering the economic storm; looking to the future there are reasons to be optimistic. We expect business focus to turn once again to growth, with high performing companies differentiating themselves in four key areas: customer reach and client relationships, operational agility and innovation, cost competitiveness, and stakeholder confidence.