Stable economic climate in the Polish construction industry
Despite a harsh winter and the related work stoppages at construction sites, construction companies express slightly higher assessments of the current market situation when compared to the findings of six months ago.
by PMR Publications Tuesday, April 13, 2010
However, the companies which tend to see more negatives than positives in the current situation are still more numerous in the market. The largest obstacle cited by them are problems related to legal regulations and difficulties in dealings with officials (49% of the responses), including lack of legal regulations protecting the Polish market against underpricing by foreign companies offering construction services, overly complicated public procurement procedures and excessive bureaucracy.
Strong market competition, including competition in price, and high labour costs and taxes were relatively frequently mentioned by construction sector representatives as obstacles to doing business in the construction sector. It was also frequently the case that respondents perceived market competition as being unfair. This particular assessment of the market is affected by the fact that overseas companies apply extremely low prices when attempting to enter the Polish market.
There were also other factors named by the surveyed companies as obstacles to doing business in the construction sector. Almost one in every ten respondents mentioned problems concerning the funding of operations (8%), while each of payment backlogs, the current economic situation and lack of investments were mentioned by 5% respondents.
PMR Research interviewers also asked construction companies about the factors considered by them to be the greatest facilitators to doing business. Since most respondents did not see any significant factors facilitating market operations, only 48 valuable responses were received to this question.
Factors smoothing the progress of operations in the Polish construction market most frequently cited by respondents included the qualities possessed by their companies, namely: reliability, professionalism, honesty, good credentials and experience (27% of respondents). Next in the order were responses mentioning EU subsidies and easy access to and low prices of building materials (23% each). During a slowdown, construction companies greatly benefit from business contacts, including in particular lasting and strong relations with investors and subcontractors. Respondents also mentioned qualified staff employed by their companies (and easiness of finding new members of staff) and emergence and announcement of many new projects, which should boost demand for contractor services shortly.
This press release is based on information contained in the latest PMR report entitled “Construction Sector in Poland H1 2010 – Development Forecasts for 2010-2012”.
For more information on the report please contact:
tel. /48/ 12 618 90 00
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