Singapore in drive to export modern construction
Singapore’s productivity-focussed Building and Construction Authority (BCA) will lead a delegation of around 30 companies to the Indian state of Andhra Pradesh to offer expertise in modern construction methods and to seek work for Singaporean firms.
The city state’s construction regulator, BCA is several years into a drive to promote prefabrication in the Singaporean construction industry.
Companies in the delegation include contractors, consultants, material suppliers, IT firms, and trading and investment firms, the BCA said.
This latest mission builds on existing ties between Singapore’s construction industry and the Indian state.
Further back, Singapore has been involved in helping Andhra Pradesh build its Capital City Amaravati since 2014.
“There are ample opportunities in Andhra Pradesh for Singapore enterprises at this phase of city building,” said Tiong Seng’s chief executive Pek Lian Guan.
“With Aprera driving quality and on-time delivery of real estate projects in Andhra Pradesh, Singapore firms will be able to value-add to these efforts as they have built up expertise and experience in these knowledge areas,” said BCA’s chief executive Hugh Lim.
Ethiopia and Somalia agree joint development of four
Somalia and Ethiopia have announced plans to invest in “four key seaports” and an international highway network as a way of attracting foreign investment.
The agreement was reached after a meeting in Mogadishu between President Mohamed Abdullahi Farmaajo of Somalia and Ethiopia’s newly installed prime minister Abiy Ahmed.
In recent years Ethiopia has been moving closer to the UAE, and the announcement follows a pledge from the UAE to give it $3bn in aid. Under the terms of that deal, the money will be used as capital investment in construction projects.
Ahmed Shide, Ethiopia’s communication affairs minister, said the money would significantly further the country’s development goals. (See video embedded beneath.)
One billion dollars will be deposited in Ethiopia’s central bank to ease its foreign currency shortages. These have become so severe that the government has been considering the privatisation of Ethiopia Airlines, Africa’s fastest growing carrier.
This move caused diplomatic difficulties with Somalia, which claims Somaliland as its territory, and which passed a law making the investment illegal. The UAE’s investment in Ethiopia, and Ethiopia’s warming relations with Somalia, may improve the situation.
Kenya’s property market booms as election fears fade
Investors are targeting Kenya with residential and other property schemes as land values rise against the backdrop of a growing and urbanising population, strong economic growth, and government investment in infrastructure.
While the East African country’s GDP growth dipped last year to an estimated 4.8% amid drought and a tense, prolonged election cycle, analysts predict a rebound to 5.5% growth this year, and a continuation of rapidly rising property prices.
Last week a fund seeded by Kuramo Capital made an equity investment in Nairobi’s Century Developments, which plans to invest $200m over the next five years in real estate, including on student and affordable housing, and on the industrial and healthcare sectors.
The demographic background contributes to the positive outlook as well, Cytonn noted.
Kenya’s population growth rate of 2.6% is higher than global averages of 1.2%. This population is urbanising rapidly and there is a rising middle class, leading to sustained demand for housing and commercial development.
Europe’s new infrastructure ties with Iran in question as US
Much is at stake for US and European companies enjoying revived trade with Iran following US President Donald Trump’s decision this week to pull out of the Iran nuclear deal and impose fresh sanctions.
Hardest hit will be oil and gas firms, plane makers like Airbus and Boeing, and car makers.
The US Treasury has said that there will be wind-down periods of 90 and 180 days before sanctions are implemented.
European leaders have deplored Trump’s decision, and pledged to uphold the agreement, which was signed on 14 July 2015 by Iran and the five permanent members of the UN Security Council – China, France, Russia, UK, and the US – plus Germany and the European Union (EU).
“I will consult with all our partners in the coming hours and days to assess their implications,” she said in a statement, adding: “The European Union is determined to act in accordance with its security interests and to protect its economic investments.”
What to do?
Experts suggest the EU could try and negotiate exemptions to the new sanctions regime, or even revive a “blocking statute” that prohibits European companies from complying with US sanctions.
Even if the EU takes measures to shield European companies, US sanctions could restrict the availability of international finance for big schemes.
Iran spread its bets
After the nuclear deal was signed, Iran launched an immense programme to extend its rail network from 15,000km to 25,000km by 2025, with some $25bn of work under way or set to start within five years.
Siemens will tread carefully
Keen to sell turbines and locomotives, Siemens was one of the first companies to re-enter the Iranian market.
Chief Financial Officer Ralf Thomas told reporters that from an overall corporate perspective, Siemens’ Iranian business was “immaterial to the company”, and that “we take note that one of the most important industrial countries on the planet has reached a political decision”.
The French connection
A week before the nuclear deal was signed on 14 July 2015, French consultant Arep won an $8m contract to redevelop Iran’s three main railway stations.
In April last year Vinci’s concessions business was reported to have concluded a deal to renovate, expand and run two airports, Mashhad and Isfahan, Iran’s second and fifth largest.
Bouygues’ project was understood to be hampered even then by the reluctance of international banks to provide finance, given the Trump administration’s hostility to Iran and the possibility of further US sanctions.
The Italian job
Earlier, in February 2016, Italy promised Iran €5bn in export credits in return for contracts to build the Qom-Arak line and also a 320-km link between Tehran and Hamadan.
Friends in the hot seat
Other US allies will find themselves in the hot seat now that President Trump is closing the drawbridge to Iran.
In 2016 the government of Narendra Modi approved a $150m line of credit for the expansion. The port was to be operated by Indian entities.
Work begins on Aedas’ ‘Cloud City’ in western Chinese city
Work has begun on a Vanke Tianfu Cloud City, a collection of high and medium-rise towers that fill four neighbouring plots in the Sichuan capital of Chengdu, in western China.
The buildings, designed by Hong Kong architect Aedas for Shenzhen developer Vanke, will host a combination of offices, exhibition centres, hotels, shops and a market place. The four plots are connected by a 54,000 sq m “green axis”, to create a “park-like setting”.
It has become de rigueur for high-end Chinese developments to incorporate greenery into their designs, and this is no exception.
Its terraced faÃ§ades and expansive balconies are filled with plants and offer panoramic views of Xinglong Lake.
Chengdu is undergoing a rapid expansion. In 2016, the Chinese government approved an $11bn, six-runway international airport there, intended as the centre of an “aerotropolis” and a link in the new Silk Road.Â
India plans to build 100 new airports to deal with surge
The government of India says it is planning to spend $60bn on doubling the number of airports it operates as it races to meet demand in its aviation market, the world’s fastest growing.
Jayant Sinha, the minister for civil aviation, said in a recent interview with the Nikkei Asian Review that “India should have 150 to 200 airports … in the next 15 to 20 years”.
In 2017, the throughput of domestic passengers recorded its 42nd straight month of double-digit growth, and domestic and international passengers together grew 17% over the year. This will shortly push important hubs such as Mumbai and Chennai to operate above their design capacity.
The question that remains unanswered is how India will finance expansion on this scale. Sinha, the civil aviation minister, told the Nikkei Asian Review that the bulk of the investment would come from the private sector.