Nigeria Construction Market Report 2022 with an Extensive Review of the Government's Infrastructure Development Plans

DUBLIN, Jan. 20, 2023 /PRNewswire/ -- The "Nigeria Construction Market Report 2022" report has been added to  ResearchAndMarkets.com's offering.

This report details the state of the Nigerian construction industry, with an extensive review of the government's infrastructure development plans to address the country's infrastructure deficit. These government initiatives plans will present considerable and wide-ranging opportunities for construction projects.

Nigeria has the largest economy in Africa and is the continent's most populous country. The country's construction industry has an estimated market size of between US$26.9 billion to US$40.3 billion and accounts for 9% of GDP.

With Nigeria's infrastructure stock currently estimated at 30% of GDP, the country has significant infrastructure gaps, and it is estimated that the country will require an investment of about US$3 trillion to meet the infrastructure demands of Nigeria's growing population, which is now at over 200 million people. 

Infrastructure development is a major constraint to Nigeria's growth. Many businesses and investors have lamented the challenges of doing business in Africa's largest economy. The ratio of infrastructure stock to GDP is less than 30%, which is reflected in key sectors of the economy such as transportation, health, electricity, education, and housing. However, the federal government is keen to boost infrastructure development in collaboration with the organized private sector.

The government has adopted the National Infrastructure Master Plan (2014 -2043) and the National Development Plan (2021 -2025) as long and medium-term strategies to bridge the infrastructure gap. The government also established the Infrastructure Corporation of Nigeria (InfraCorp) - an NGN15 trillion fund - to drive Public-Private Partnership (PPP) investments in infrastructure in Nigeria.

The federal government is showing commitment to rebuilding infrastructure as it allocated N5.96 trillion (35%) to capital expenditure in the 2022 budget. The total budget for 2022 was NGN17.13 trillion - with a planned deficit of NGN6.4 trillion, representing 3.5% of GDP. The government looks to embark on 11,800 new projects as well as continue old ones. These projects, valued at over NGN3.6 trillion, would involve constructing schools, hospitals, roads, bridges, houses, energy, and telecommunication infrastructure. Infrastructure development in the public and private sectors boost output in the construction sector.

The construction sector in Nigeria accounted for about 7.2% of GDP on average from 2017 to 2021. In 2021, construction GDP was estimated at US$39.49 billion - up 42.5% from US$27.71 billion in 2020. The sector grew 4.8% in Q1 2022 - a rebound from the -31% contraction in Q2 2020 because of the effects of the COVID pandemic on the economy.

The market size of the Nigerian construction industry is estimated at between US$26.9 - 40.3 billion. The sector accommodates many foreign and local companies competing favorably for projects in the public and private sectors. However, there are perceptions of corruption in the public sector in the procurement process. Chinese investments seem to dominate public sector projects. Like every other sector in Nigeria, the construction sector also records a high level of informal activities.

Nonetheless, the underlying macroeconomic conditions, such as high inflation, exchange rate volatility, multiple exchange rate, and foreign exchange scarcity, make it difficult to estimate project costs and even harder to repatriate profits. Other challenges in the sector include a shortage of skilled workers, underinvestment, substandard materials, and corruption.

However, the Nigerian construction sector presents tremendous opportunities in different sectors of the economy. The government at all levels is committed to infrastructure development, and the private sector is actively responding to the call for partnership by the government. There is a huge advantage for early entrants as the urbanization rate grows.

The overall outlook for the industry is positive, especially in light of recent reforms like the Petroleum Industry Act 2021, National Infrastructure Funds, and other initiatives to enhance infrastructure in the country.

The report also provides insights into how the Nigerian construction industry operates, including tender and procurement procedures, competition, and industry entry barriers.

The report will help you:

• Understand challenges and opportunities in the Nigerian construction market
• Gain insight into upcoming and ongoing projects in Nigeria
• Identify key players in the Nigerian construction industry
• Obtain a forecast for the future direction of the market

Key Topics Covered:

1. Executive Summary

2. Nigeria Country Overview
2.1 Geography
2.2 Political Situation
2.3 Economic Overview
2.4 Investment Climate

3. The Nigerian Construction Industry
3.1 Overview
3.2 Size of the Construction Sector
3.3 Opportunity Segments
3.4 Case Studies of Some Key Players and Stakeholders
3.5 Equipment, Materials and Tools Market
3.5.1 Equipment Companies
3.2.2 Materials and Tools Companies

4. Market Potentials
4.1 Government Fiscal Activities - Budget
4.2 Market Potentials by Sector
4.2.1 Transportation Sector
4.2.2 Residential Sector
4.2.3 Power and Energy Sector
4.2.4 Education sector
4.2.5 Health Sector
4.2.6 Commercial Building Sector

5. Doing Business in Nigeria
5.1 Entering the Market
5.2 Permits and Licenses
5.3 Recruiting and Retaining Staff
5.4 Other Relevant Factors

6. How Nigeria's Construction Market Operates
6.1 Features of the Construction Industry
6.1.1 Competition
6.1.2 Barriers to Entry
6.1.3 Informal Construction Activities
6.1.4 Public Procurement and Tendering Process
6.2 Industry Supply Chain
6.3 Tender Prices and Construction Cost Trends
6.4 Labour Resources
6.4.1 Training and Skills Development
6.4.2 Skills Shortage
6.4.3 Licensing
6.4.4 Opportunities for Foreign Professionals
6.5 Construction Contracts and Dispute Resolution
6.5.1 Forms of Contact
6.5.2 Contractual Risks
6.5.3 Dispute Resolution

7. SWOT Analysis
7.1 Strengths and Weaknesses
7.2 Opportunities and Threats
7.3 General Comments

8. Construction Market Outlook

9. Industry Associations

10. Company Profiles

For more information about this report visit https://www.researchandmarkets.com/r/3oklct

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