EECFA countries in the European Commission’s 2019 Macro Forecast

In Spring 2019, prior to the publication of the 2019 Summer EECFA Construction Forecast Report, the European Commission released its forecast for the economic prospects for EECFA member countries. Here is a summary of the main changes in prospects between Autumn 2018 and Spring 2019.

Written by Tünde Tancsics, EECFA Research, ELTINGA

Economic outlook is still better in the eastern region of Europe than in the rest of the continent, though it has slightly worsened in many countries of the EECFA region between Autumn 2018 and Spring 2019. The only exception among EECFA countries is Russia whose prospects have improved, as well as Hungary (covered by Buildecon in Euroconstruct) with almost 0.4 percentage points.

As Chart 1 shows, GDP growth in the eastern region is higher than the EU average, Turkey excepted where forecasted average annual GDP growth for 2018-2020 remains under 1.5%. As per data by the European Commission, economic prospects are the best for Hungary and Serbia that may see an increase in GDP by more than 3.5% annually between 2018 and 2020.

We have also examined Gross fixed capital formation increase in EECFA countries, in Euroconstruct member Hungary and in the EU. Chart 2 indicates that expected GFCF growth – as in case of GDP – is also higher in most EECFA countries. Moreover, the advantage of Serbia, Croatia, Hungary, Slovenia and Bulgaria is even bigger than the one experienced for GDP. GFCF prospects have greatly declined for Romania; average annual GFCF growth rate for 2018-2020 has shrunk close to zero by Spring 2019 from more than 5% in Autumn 2018. However, among EECFA countries Turkey is the only one where GFCF is set to decrease in 2018-2020.

Hungary is still leading in GFCF prospects with a nearly 10% projected annual growth rate. Slovenia ranks second and Serbia lines up third with both having an 8% growth rate. Hungary has come first in terms of predicted growth of construction investment (15%). Construction’s share in total investment in EECFA countries is between 57% and 65%, with Turkey having the highest rate. Romania also has a high rate of as much as 64%.

For construction segment level forecast, please check our reports that can be purchased on eecfa.com

EECFA countries in the European Commission’s 2018 Spring Macro Forecast

Before the publication of the 2018 Summer EECFA Forecast Report, the European Commission released its spring forecast, revealing the prospects for almost all EECFA member countries. Let us highlight the main changes in the prospects over the past half year.

Written by Aron Horvath, PhD, EECFA Research, ELTINGA

Chart 1. Revision of GDP growth forecasts for EECFA countries, Hungary and the EU (average 2017-2018-2019) Source: European Commission

Chart 1 shows that GDP growth is higher in the region than in the EU, so the economic outlook is still better in the Eastern region. Looking at the individual level, the only exception is Russia, where economic growth is set to remain under 2 percent according to the Commission. As for the rest of the countries in the region, the expected growth is between 2.75 and 5.5 percent. Turkey and Romania lead the group with an over 5 percent forecasted economic growth.

Among EECFA countries, Slovenia, Turkey and Romania have witnessed their economic outlook having improved since the latest forecast in Autumn 2017. On the other hand, the forecasted GDP growth Continue reading EECFA countries in the European Commission’s 2018 Spring Macro Forecast