Finland
The Finnish economy is likely to grow by less than 3 per cent this year, and a further slowdown of growth is expected next year. The risks of accelerating inflation and higher interest rates have reduced somewhat. On the other hand, the diminished availability of financing has become a significant uncertainty factor.
According to the Confederation of Finnish Construction Industries, there will be a downturn in construction next year and unemployment will start to rise. It is expected that a total of 25,000 new housing starts will be made in Finland this year, falling to 23,000 in 2009.
The growth of commercial and office construction has slowed down especially in the second half of the year, and its volume is expected to contract next year. Current projects have been postponed due to financing difficulties. The market for industrial construction has remained good and the growth of refurbishment contracting is expected to continue also next year.
The infrastructure construction market has remained reasonably good. Next year there may be a short-lived downturn in growth due to the postponement of some major projects.
Relevant markets for Lemminkäinen abroad
In Sweden, Norway and Denmark the economic growth rate will slow down in 2008-2009. In Norway and Sweden the growth of infrastructure construction will be supported by additional appropriations decided by the governments of these countries.
In the Baltic states new road construction and upgrade projects are still being launched, but the difficult competitive situation and lower price level have significantly weakened the operating conditions in the region.
In Russia construction continues to be brisk and inward foreign investment has been growing. The availability of credit for consumers and businesses has deteriorated in the third quarter, which may reduce the volume of construction in the near future.
Source: Lemminkäinen´s Interim report 1-9/2008