Canada’s infrastructure sector set to be one of the best performing

In their latest findings on Canada’s infrastructure sector, Business Monitor has revised down their outlook for the overall construction industry in Canada for 2013 to 2.2 per cent. This is being driven by a sharper than expected contraction in industry value creation from the residential and non-residential building segment. Despite this, they anticipate a slight pick-up in the second half of the year will ensure that subsector maintains positive growth. On the other hand, infrastructure will post another
November 20, 2013 Read time: 2 mins

In their latest findings on Canada’s infrastructure sector, Business Monitor has revised down their outlook for the overall construction industry in Canada for 2013 to 2.2 per cent. This is being driven by a sharper than expected contraction in industry value creation from the residential and non-residential building segment. Despite this, they anticipate a slight pick-up in the second half of the year will ensure that subsector maintains positive growth. On the other hand, infrastructure will post another year of solid performance, with Business Monitor’s outlook for robust growth in the subsector unchanged.

Although below trend construction industry data has prompted Business Monitor to downgrade their 2013 forecast for industry growth, they are maintaining their view that Canada will be one of the best performing developed markets over the near term. Growth will be supported by high-value infrastructure projects across the transport and energy sectors, as well as social infrastructure, industrial projects, and a housing market that whilst slowing, should remain positive.

One of the strongest sub-sectors over Business Monitor’s 10-year forecast period to 2022 will be railways, where a project pipeline worth US$36 billion will drive annual average industry value real growth of 4.4 per cent between 2013 and 2022. This growth will be driven primarily by urban rail projects, including the CAD8.2bn Eglinton Crosstown Light Rail Transit project, the US$2.6 billion Toronto Subway Spadina line expansion, the US$2.1 billion Ottawa Light Rail project and the US$1.8 billion Edmonton Light Rail project.

There is further upside potential to Business Monitor’s forecast from freight rail projects, however, with the Cóte Nord rail project in Quebec temporarily suspended in February 2013 due to weak demand, they have seen verification for their decision to withhold these projects from their forecast. In November 2012, a railway project to transport crude from Alberta's oil sands to Alaska moved forward. The project has support from first Nations groups and is seeking financing to produce a feasibility study.

Related Content

  • Global traffic management market ‘worth $64bn by 2025’: report
    February 7, 2020
    The global market for traffic management products and services is set to expand in value by 14% per year for the next five years, according to a new study.
    Read More
  • Study in Finland shows infrastructure is a good investment
    March 28, 2012
    VTT Technical Research Centre of Finland, the University of Oulu and Aalto University in Finland have analysed the financial statements for 2002-2009 of companies, public utilities, and municipal units that own infrastructure, including water services, as well as road, port, airport, railway and electricity networks. Owning infrastructure is relatively risk-free. The most profitable is the energy sector where the return on investment was about 13%. The average annual return on investment of ports was 10%. T
    Read More
  • KPMG on Russia’s road infrastructure market prospects
    December 5, 2013
    Research by KPMG has revealed that the Russian road infrastructure market is growing by an average ten per cent per year. The market may total US$43.62 billion by 2020, compared with US$9.9 billion in 2007. According to analysts, only large federal road construction companies are able to achieve the highest profitability. However, such companies will have to reduce costs because contracts are becoming bigger and more complex and include construction of artificial structures, for example. Consolidation of co
    Read More
  • Market for industrial and commercial electric vehicles market to grow 4.5 times
    December 9, 2016
    According to a new report by IDTechEx Research, Industrial and Commercial Electric Vehicles on Land 2017-2027, today’s industrial and commercial sector represents 60 per cent of the value of the whole electric vehicle market, and it is set to grow 4.5 times in the next decade. Industrial electric vehicles make industry more efficient and commercial electric vehicles reduce congestion. Both of them greatly reduce pollution and align closely with government objectives concerning industry and the environment,
    Read More

Highlighted Content