According to a study from The Freedonia Group Inc., a Cleveland-based
industrial market research firm, construction expenditures in
China will increase 11.2 percent annually though 2008, reaching
approximately $454 billion at current official exchange rates.
In real (inflation adjusted) terms, spending will grow at a 7.8-percent
Although The Freedonia Group says growth in Chinese construction
demand will slow somewhat from the 1998-2003 pace, it adds that
the country will continue to outperform other major national construction
markets through 2008. Sustained strength in foreign investment
funding, additional economic reforms, healthy demand for Chinese
manufactured goods and further population and household growth
will all work to drive demand for construction in China.
In particular, non-building construction is predicted to be the
fastest growing sector, with expenditures climbing 8.9 percent
annually in real terms through 2008. Residential building construction
will advance at a 7 percent annual pace, spurred by government
efforts to further boost average per-capita living space and private
homeownership. In 2003, the nonresidential market accounted for
two-fifths of all construction spending in China.