Slow year ahead for construction activity: report

The State of the Regions Report was released yesterday in Melbourne and claimed to identify what it called a troubling convergence of factors that were set to impact regional economic development across Australia.The report said it was likely the current financial crisis would result in a significant cancellation or postponement of projects that have been approved, but have not yet started. “There is also likely to be a large number of terminations of work on projects currently under construction as finance supply contracts significantly,” the report said. The report divides Australia into 65 regions and analyses how regions are performing and the likely consequences of current economic circumstances and trends for each region.Regions are grouped into six types (zones): knowledge intensive, dispersed metro, independent city, lifestyle, resource based and rural.Total construction expenditure per capita across Australia overall was forecast to fall to its lowest level for the period since 1998, with only the resource and rural zones expected to improve on the 1998 figures. The biggest drops were expected to take place in 2009, with per capita construction expenditure expected to reduce by almost 30% for 2009 compared to 2008 for the knowledge-intensive zone.ALGA said the report’s projections for construction activity were prepared on the basis of the latest official data.

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