Construction in Malaysia – Key Trends and Opportunities to 2024

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Construction in Malaysia – Key Trends and Opportunities to 2024

Summary

Malaysia’s construction industry contracted by 1% in real terms in 2019, following an average annual growth of 6.7% during the preceding four years.

This decline can be attributed to the global economic slowdown, a halt in several mega construction projects, and an increase in the country’s unsold housing stocks. On the residential construction side, the prognosis remains negative, and 2019 will see a contraction of 5.2% in construction output value, following the steep decline of 7.5% in 2018. Although real estate transactions are on the rise – with some local agents predicting the highest sales levels in four years in 2019 – unsold housing stock remains on an upward trend, and developers are holding back new launches, contributing to the sluggish performance on the new construction side; this will continue to undermine construction growth opportunities. However, although risks remain on the downside, this research expects there to be some support for the sector in 2020, coming from new policies that have been introduced to prop up the market.

The industry is expected to recover in 2020, with output expected to register a growth of 3.2% in real terms that year. This momentum is expected to continue throughout the forecast period (2020-2024), driven by government plans to upgrade the country’s transport infrastructure, coupled with efforts to boost the residential and tourism sectors. Growth in Malaysia’s civil engineering sector continues to expand at a rapid pace, despite the interventions of Mahathir Mohamad, a former long-serving prime minister who was again voted into office in 2018; this reflects the ongoing investment in rural infrastructure development projects. Soon after coming to office, the prime minister followed through on his pledge to review all Chinese-backed projects, citing concerns over affordability and mismanagement.

The government put three major oil and gas projects on hold, including the Trans-Sabah Gas Pipeline and the East Coast Rail Link (ECRL). In a positive step regarding future investments, in April 2019 Malaysia and China signed a revised agreement to resume the construction of the ECRL, with the new agreement reducing the scope and cost of the original project. The new investment required to construct the railway is MYR44.0 billion (US$10.7 billion), which is nearly two-thirds of the original cost. The focus on the development of renewable energy infrastructure is also expected to drive industry growth. Foreign direct investment (FDI) inflow is also increasing in the country, which is leading to new investments, particularly in the manufacturing sector. The government aims to optimize the current US-China trade standoff situation by attracting more investments in the country.

The industry’s output value in real terms is expected to post a compound annual growth rate (CAGR) of 5.62% over the forecast period.

Construction in Malaysia – Key Trends and Opportunities to 2024 report provides detailed market analysis, information and insights into the Malaysian construction industry, including –
– The Malaysian 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 the Malaysian 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 Malaysia. It provides –
– Historical (2015-2019) and forecast (2020-2024) valuations of the construction industry in Malaysia, 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 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 critical and actionable insight.
– Assess business risks, including cost, regulatory and competitive pressures.
– Evaluate competitive risk and success factors.


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Ritesh Tiwari is the Founder of Research By Markets, a leading Market Research Reports Reseller trusted by Fortune listed companies for their requirements of Syndicated and Custom Market Research Reports. Ritesh has an overall experience of 18+ years in Recruitments, Sales and Operations. He has been associated with the Market Research industry for the past 7 years. He is an avid foodie as well as a huge football fan being a supporter of Manchester United (EPL) and FC Barcelona (La Liga). Get in touch with him via ritesh@researchbymarkets.com. *Market Research News is a part of Research By Markets.