Constructions in Romania hike 26% last year y/y to EUR 14.3bnPublish date: 23-03-2009
The volume of constructions in Romania increased last year by 26 percent over the previous one to 14.3 billion euros but towards the yearend started to feel the burden of the economic crisis, the head of the constructions entrepreneurs association Laurentiu Plosceanu said.
Yet, the past year growth was in fact a 6 percent slowdown over the pace in 2006-2007, he added.
The field was affected by the lowering demand, the dropping prices and the rising unemployment, all caused by the economic crisis. Some 20,000 staff working in constructions was dismissed by the beginning of the year.
Moreover, the costs of architecture projects will decrease in the next period following a massive cut of real estate projects owing to the economic crisis, but could prompt a lower quality, the vice president of architects' organization in Romania OAR Serban Tiganas told NewsIn at the end of last month.
Architects deem a fast solution to reduce the effects of the economic crisis over the sector is for the authorities to attract money for public projects and to change the legislation for public acquisitions.
Once the financial crisis knocked on Romania's door, the real estate sector was among the first to feel the effects. The local construction market is expected to decrease by as much as 15 percent this year, with no new builds being started during the next two years. Analysts deem the market will only escape the financial crisis at the debut of 2011.
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