International Contractors' Outlook

In a survey of the top 225 international contractors by the Engineering News-Record, results revealed that the construction recession has not been universal. Some regions and market sectors have done well despite the downturn and many international contractors are thriving.

ENR compiled data from the top 225 contractors based on annual contracting revenue from projects outside the home country. The top 225 generated US$383.78 billion in revenue in 2009, up 0.4 percent from US$382.44 billion in 2008.

Infrastructure and development projects seemed to be the key to a regions' ability to weather the recession, according to survey results. Africa showed the biggest increases in international contracting revenue. In central and southern Africa revenue grew 31.7 percent to US$27.52 billion in 2009 from US$21.04 billion in 2008. North Africa grew 30.8 percent to US$29.29 billion from US$21.04 billion in 2008.

International contracting revenue from Latin America rose 14.1 percent in 2009 to US$24.82 billion from US$421.76 billion in 2008. Revenue rose 10.3 percent in the Caribbean to US$2.29 billion.

Asia also showed strong growth with US$73.18 billion in revenue in 2009, up 6.75 percent from US$68.56 billion in 2008.

Among market sectors, the lack of project financing was felt across the board. International revenue from general building projects dropped 8.5 percent to US$85.99 billion in 2009 from US$93.93 billion in 2008. Some respondents said the opportunities for international firms will shrink as political support for local companies grows, especially for state-financed projects.

Asia may be the biggest regional construction market in the world, but many international contractors are finding it tough to win contracts. While Hong Kong was deemed a strong prospect for contractors, respondents found mainland China far more challenging with responses ranging from "mainland China is elusive" to "China is totally closed."

Most of China's infrastructure stimulus funds are staying inside the country. China's biggest contractors, China Railway Group Ltd., China Railway Construction Corp. Ltd., China State Construction Engineering Corp., China Communications Construction Group and China Metallurgical Group Corp. report a combined total of $326 billion in new contract awards in 2009. Of that, 85 percent was from domestic projects.

But the other Asian giant, India, is proving more attractive to some. For instance, Hochtief, ENG's top-ranked international contractor, has deployed scouting teams, lured by India’s huge highways upgrade program.