Construction in Taiwan - Key Trends and Opportunities (H2 2021)

Taiwan’s response to the Coronavirus (COVID-19) pandemic has been largely successful, with the country being one of only five nations in the Asia-Pacific region to record economic growth in 2020. To offset the disruption caused by the pandemic, the government has increased spending on infrastructure and public works, to underpin employment and bolster the economy. As a result of the government’s expansionary fiscal policy and strong demand for industrial capacity, the Taiwanese construction industry registered strong growth in the first three quarters of 2021. According to the Directorate General of Budget, Accounting and Statistics (DGBAS), the construction industry’s value add rose by 8.4% year on year (YoY) in the first three quarters of this year. The industry is expected to retain its growth momentum in the final quarter of this year, supported by the relatively low COVID-19 infections, coupled with progress in the country’s vaccination drive. The country has administered over 33 million doses of the COVID-19 vaccine as of 9th December, 2021. Of the total, over 14.8 million people - equivalent to 62.1% of the total population - have been fully vaccinated. Considering the above factors, the publisher has revised the estimated growth for Taiwan’s construction industry upwards in 2021, with the industry now expected to grow by 8.2% in real terms this year, compared to an earlier estimate of a 7.2% growth.

The industry is expected to register an annual average growth of 3.2% between 2022 and 2025, supported by investment on manufacturing, transport and renewable energy projects. In August 2021, the cabinet approved the central government’s budget for 2022, which includes an annual spending of TWD2.3 trillion (US$81.6 billion) next year. To strengthen key infrastructure projects, the government increased its allocation towards public infrastructure by 2%, going from TWD227.7 billion (US$7.7 billion) in 2021 to TWD232.3 billion (US$8.4 billion) in 2022. Previously, in April 2021, the world’s largest semiconductor foundry, Taiwan Semiconductor Manufacturing Company (TSMC), announced plans to invest TWD2.8 trillion (US$100 billion) to expand its chip fabrication capacity over the next three years. The company is focused on increasing semiconductor output, to address the global shortage of semiconductors. In April 2021, the company stated that it expects semiconductor shortages to extend into 2022. It also reported that it had acquired land and equipment, and had begun construction on new manufacturing capacity.

Forecast-period growth in the construction industry will also be supported by investments as part of the Forward-Looking Infrastructure Development Program (FLIDP). The FLIDP covers a wide range of public infrastructure projects, including sectors such as transport, green energy, digital infrastructure and water environments. Funding for the initial four-year phase (2017-2020) totalled TWD420 billion (US$15.1 billion). Previously, in September 2020, the government earmarked TWD510 billion (US$17.2 billion) for the second phase of the program (2021-2024), which will focus on 5G infrastructure and digital transformation. Of the total budget for the second phase, the government allocated TWD49 billion (US$1.8 billion) for 5G digital transformation and TWD46.4 billion (US$1.4 billion) for digital infrastructure construction.

The publisher’s Construction in Taiwan - Country Briefing (H2 2021) report provides detailed market analysis, information and insights into Taiwan’s construction industry, including:

• Taiwan’s construction industry's growth prospects by market, project type and construction activity
• Critical insight into the impact of industry trends and issues, as well as an analysis of key risks and opportunities in Taiwan’s construction industry
• Analysis of the mega-project pipeline, focusing on development stages and participants, in addition to listings of major projects in the pipeline.

Scope

This report provides a comprehensive analysis of the construction industry in Taiwan. It provides:

• Historical (2016-2020) and forecast (2021-2025) valuations of the construction industry in Taiwan, featuring details of key growth drivers.
• Segmentation by sector (commercial, industrial, infrastructure, energy and utilities, institutional and residential) and by sub-sector
• Analysis of the mega-project pipeline, including breakdowns by development stage across all sectors, and projected spending on projects in the existing pipeline.
• Listings of major projects, in addition to details of leading contractors and consultants

Reasons to Buy

• Identify and evaluate market opportunities using the publisher's standardized valuation and forecasting methodologies.
• Assess market growth potential at a micro-level with over 600 time-series data forecasts.
• Understand the latest industry and market trends.
• Formulate and validate strategy using the publisher's critical and actionable insight.
• Assess business risks, including cost, regulatory and competitive pressures.
• Evaluate competitive risk and success factors.