The construction sector would only recover towards the second quarter of 2024, as reference rates ease and 2023 closes with a modest growth of 6.4% leveraged by the completion of prevention works due to El Niño, Scotiabank said.
According to the Canadian Capital Bank, the 9.6% drop in August and the 9% annualized contraction portend that construction will experience results below expectationsespecially due to the low consumption of materials for self-construction, which represents 70% of the national demand for cement.
In addition to prevention works, Scotiabank considers that the sector will also receive a break thanks to the higher level of investment in concessioned infrastructure projects, while a de-escalation of the value of the materials. The fall of the sector will continue, but at a slower pace.
“This, taking into account that in the first quarter the possible heavy rains on the north coast would affect the normal execution of the projects, as well as the transportation of cement due to the potential temporary interruption of the roads,” the document states.
As for self-construction, there is not much that can be done. Since the passage of the Yaku and the social protests that raged in the country at the beginning of the year, it has not been able to recover.
Where there could be some space for the development of real estate projects is in the progressive reduction of mortgage loans, dependent on a reference rate that the Central Reserve Bank (BCRP) reduced to 7.25% in its last meeting in October.
Public works are not enough
On the other hand, Scotiabank warns of poor dynamics in the execution of public works by subnational governments.
And it is that, Until September, public investment grew almost 4% due to the higher level of investment by the central government (20.7%) and regional governments (8.2%), but under downward pressure due to the lower execution of projects by municipal governments (-11.4%) .
Paralyzed construction dynamics
Between January and September, cement shipments fell 12%, according to figures from the Cement Producers Association.
Capeco reported that there are more than 2,000 paralyzed works with a combined value of S/25,000 million so far in 2023.
Private investment would rise 2% in 2024, driven by non-mining investment, according to Scotiabank.
Source: Larepublica
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