Includes 3 FREE quarterly updates
BMI View: We maintain our forecasts for a deceleration in growth in the Chinese infrastructure and construction segments over 2012, with an increasing number of indicators validating our view. While government murmurs of a small infrastructure stimulus have not gone unnoticed, the swollen local government debt from the first stimulus is making new credit allocations a precarious and prohibitive venture.
Key developments in China’s infrastructure sector include:
However, the strength of its infrastructure market often masks the high barriers to entry, the opaque regulatory and legal framework and the uncompetitive environment, which have shaved points from the country’s overall ratings. Consequently, we have revised down the component scores in these categories. In BMI’s Infrastructure risk/reward ratings, China scores 65 out of 100, with its strong infrastructure market propelling it near the top of the regional table.
BMI View: We maintain our forecasts for a deceleration in growth in the Chinese infrastructure and construction segments over 2012, with an increasing number of indicators validating our view. While government murmurs of a small infrastructure stimulus have not gone unnoticed, the swollen local government debt from the first stimulus is making new credit allocations a precarious and prohibitive venture.
Key developments in China’s infrastructure sector include:
- We maintain our muted forecasts for railways and expect to see a deceleration in industry value growth starting in 2012 and running to the end of our forecast period in 2021. New data from the Ministry of Railways corroborates this view, indicating a steep unwinding of spending.
- Our forecasts for a revival in airport construction are supported by the announcement of a new mega-airport project – to replace the Beijing Nanyuan Airport – should be completed by 2017.
- In the housing sector, the government has pledged the construction of another 50mn low cost housing units between 2011 and 2014. While this will drive construction, our concerns over the ability of indebted local governments to meet their share of the funding requirements mean we see risks to the timely implementation of the ambitious scheme.
- In addition to the persistent unwinding of fixed asset investments growth, the production pattern of building materials also suggests a downtrend. We forecast that cement production and consumption growth will be markedly lower in 2012 and 2013, continuing its downtrend from 2011.
However, the strength of its infrastructure market often masks the high barriers to entry, the opaque regulatory and legal framework and the uncompetitive environment, which have shaved points from the country’s overall ratings. Consequently, we have revised down the component scores in these categories. In BMI’s Infrastructure risk/reward ratings, China scores 65 out of 100, with its strong infrastructure market propelling it near the top of the regional table.
BMI Industry View
SWOT Analysis
China Infrastructure SWOT
Market Overview
Competitive Landscape
Table:
Building Materials
Global
Asia
Cement Forecasts
Table: China Cement Production and Consumption Data
Table: China Cement Production and Consumption Data
Industry Forecast Scenario
Table: China Construction And Infrastructure Industry Data
Table: China Construction And Infrastructure Industry Data
Construction and Infrastructure Forecast Scenario
Transport Infrastructure
Table: China Transport Infrastructure Industry Data
Table: China Transport Infrastructure Industry Data
Transport Infrastructure Outlook and Overview
Major Projects Table – Transport
Table: Key Projects - Transport
Energy and Utilities Infrastructure
Table: China Energy and Utilities Infrastructure Industry Data
Table: China Energy and Utilities Infrastructure Industry Data
Energy and Utilities Infrastructure Outlook and Overview
Major Projects Table – Energy And Utilities
Table: Key Projects – Energy And Utilities
Residential/Non-Residential Construction and Social Infrastructure
Table: China Residential and Non-residential Building Industry Data
Table: China Residential and Non-residential Building Industry Data
Residential/Non-Residential Building Outlook and Overview
Major Projects Table – Residential/Non-Residential Construction and Social Infrastructure
Table: Key Projects – Residential/Non Residential Construction
Risk/Reward Ratings
China Risk/Reward Ratings
Rewards
Risks
Regional Overview
Asia Pacific Infrastructure Risk/Reward Ratings
Table: China, India, Indonesia - BMI Interest Rate Views
Table: Emerging South East Asia - BMI Interest Rate Views
Table: Nearly Developed Asia - Bmi Interest Rate Views
Table: Regional Infrastructure Risk/Reward Ratings
Company Monitor
Sinohydro
China Communications Construction
Shanghai Construction Group (SCG)
China Railway Group
China Railway Construction Corporation (CRCC)
Global Overview
Methodology
Industry Forecasts
Construction Industry
Data Methodology
New Infrastructure Data Sub-sectors
Construction
Capital Investment
Construction Sector Employment
Infrastructure Business Environment Rating
Table: Infrastructure Business Environment Indicators
SWOT Analysis
China Infrastructure SWOT
Market Overview
Competitive Landscape
Table:
Building Materials
Global
Asia
Cement Forecasts
Table: China Cement Production and Consumption Data
Table: China Cement Production and Consumption Data
Industry Forecast Scenario
Table: China Construction And Infrastructure Industry Data
Table: China Construction And Infrastructure Industry Data
Construction and Infrastructure Forecast Scenario
Transport Infrastructure
Table: China Transport Infrastructure Industry Data
Table: China Transport Infrastructure Industry Data
Transport Infrastructure Outlook and Overview
Major Projects Table – Transport
Table: Key Projects - Transport
Energy and Utilities Infrastructure
Table: China Energy and Utilities Infrastructure Industry Data
Table: China Energy and Utilities Infrastructure Industry Data
Energy and Utilities Infrastructure Outlook and Overview
Major Projects Table – Energy And Utilities
Table: Key Projects – Energy And Utilities
Residential/Non-Residential Construction and Social Infrastructure
Table: China Residential and Non-residential Building Industry Data
Table: China Residential and Non-residential Building Industry Data
Residential/Non-Residential Building Outlook and Overview
Major Projects Table – Residential/Non-Residential Construction and Social Infrastructure
Table: Key Projects – Residential/Non Residential Construction
Risk/Reward Ratings
China Risk/Reward Ratings
Rewards
Risks
Regional Overview
Asia Pacific Infrastructure Risk/Reward Ratings
Table: China, India, Indonesia - BMI Interest Rate Views
Table: Emerging South East Asia - BMI Interest Rate Views
Table: Nearly Developed Asia - Bmi Interest Rate Views
Table: Regional Infrastructure Risk/Reward Ratings
Company Monitor
Sinohydro
China Communications Construction
Shanghai Construction Group (SCG)
China Railway Group
China Railway Construction Corporation (CRCC)
Global Overview
Methodology
Industry Forecasts
Construction Industry
Data Methodology
New Infrastructure Data Sub-sectors
Construction
Capital Investment
Construction Sector Employment
Infrastructure Business Environment Rating
Table: Infrastructure Business Environment Indicators
