Agusto & Co.’s Construction Industry Report is the most comprehensive and up-to-date report on the activities of construction companies in Nigeria with an in-depth review of the Industry’s operations, key trends, risk areas and how the macroeconomic climate, and more recently, Russia’s invasion of Ukraine impacts the price and availability of critical construction materials. Our report also examines the Industry’s competitive landscape, regulatory environment, key success factors, financial conditions of selected operators and market potential.
In Nigeria, infrastructure spending, by both the federal and state governments, has traditionally driven the construction industry, with civil construction works accounting for 60% of engineering contracts and private construction projects accounting for the remaining 40%. After a quick recovery from the coronavirus (COVID-19) shock, the country saw an increase in residential and non-residential construction activities in 2021, buoyed by increased capital investments by both the government and private sector. However, the industry is known for having a high number of unregistered contractors (particularly in the residential segment), which is a major cause of building collapses across the country.
Based on the expansion in key sectors such as transportation, real estate, power transmission and distribution, oil & gas and telecommunication, as well as strong pre-election spending by the government, we foresee an improved performance in 2022. However, we anticipate a decline in construction activity during and after the upcoming general election. This is due to the typical disruption of business activities during election cycles in Nigeria, as well as the time required for the formation of a new government. Overall, the Industry’s vulnerability to adverse changes in the macroeconomic and political environment remains a key risk area for construction companies in Nigeria.
Our Construction Industry Report answers questions on: