Central Europe Construction Market Report 3Q 2023
Poland
Local economic indicators
The Organisation for Economic Co-operation and Development (OECD) reports that Poland achieved 3.8% gross domestic product (GDP) growth in 1Q 2023, an improvement from the previous quarter that retracted -2.3%. The OECD’s recent Economic Outlook, published in June 2023, maintains a low forecasted annual growth rate for the year at 0.9% and cites negative private consumption as the contributing factor counteracting positive investment growth. Both figures are expected to improve in 2024 and are forecasted to produce an overall GDP growth rate of 2.1% in the coming year.
The most recent data available on Statistics Poland shows inflation at 11.5% in June, the fourth consecutive month to produce declining rates since February’s peak at 18.4%. The Eurostat Harmonised Index of Consumer Prices (HICP) has produced similar results with a peak in February (17.2%) and steady decline to June’s 11%. The OECD forecasts inflation to continue declining in the second half of the year, reaching 8.2% by year’s end.
Construction materials
The industrial price index table, located on the right-hand side, reveals that some production prices have decreased in recent months including wood, glass and lighting equipment.
The Gleeds materials price table below has been updated from previous reports:
Contracts
The construction sector in Poland is expected to grow during the forecast period, supported by ongoing road and rail infrastructure projects, residential housing and office and warehouse construction.
Market outlook
The general construction confidence indicator for the largest enterprises surveyed shows some improvement in 1Q 2023, with this figure quickly approaching a positive score. The factors most reported to be limiting construction are costs of labour, costs of materials and general economic uncertainty.
As always, Gleeds advises regular project budget updates that take into account recent market pricing and local risk factors which may impact project programmes and costs. Risk analysis studies are recommended to better evaluate and prepare appropriate contingencies for your particular project conditions and risk exposure.
Nobu Hotel, Warsaw, Poland — Gleeds Project Management, Cost Management, Quality/Construction Supervision and LEED Certification and Consultancy services.
