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Construction sector shrinks 20% Y/Y in July 2010

Construction sector shrinks 20% Y/Y in July 2010Building and infrastructure construction in Bulgaria has plummeted nearly 20% in July 2010 compared with the same period of last year. Eurostat, the European Union's (EU) statistical office, pegs the decline at 19%. According to Bulgaria's National Statistical Institute (NSI), the market plunged by a deeper 19.9%. Of all EU countries, Bulgaria fared better only than Spain (36.5%) and Romania (29.4%), the Eurostat figures revealed.

Building construction bore the brunt of the market meltdown in Bulgaria after once-abundant investments dried up. New building construction declined by 28.2%, whereas new infrastructure construction fell by 4.6% year-on-year, the NSI said. Just 576 new residential buildings were launched in the second quarter of 2010, which represents a 20% decrease from the same period of 2009. New housing units diminished by 34.7% to 4,119.

Meanwhile, thanks to better evaluations of the state of businesses in the construction industry, the business climate indicator rose by 1.7% in August, according to a NSI poll. While the slump eased up in the eight month of the year compared to the previous one, construction firms are more pessimistic about the next quarter. On a brighter note, construction orders experienced a positive trend in August. Still, a higher number of customers lagged behind with payments. The main hurdles for the sector remain the shaky economic environment, the tight financing and lacklustre demand. There was also a slight workforce shortage.

20 September 2010 - Dnevnik

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