Construction sector output jumps 18.5 pc in January

Budapest, March 16 (MTI) – Hungary’s construction sector output climbed an annual 18.5 percent in January after falling for twelve months in a row, data released by the Central Statistical Office (KSH) on Thursday show.

Building construction output was up by 32.8 percent while civil engineering output fell by 3.0 percent.

In a month-on-month comparison, construction sector output grew by 4.6 percent in January, adjusted for seasonal and workday effects.

In absolute terms, construction sector output reached 89.3 billion forints (EUR 288m) in January.

The big January increase in the sector was supported by improved absorption of European Union funding as well as the government’s CSOK home subsidy scheme for families with children, Economy Minister Mihály Varga said on public television news channel M1 after the release of the data. He added that the figures suggest a “good year” ahead, and the sector’s output could contribute to a GDP growth of over 4 percent in 2017.

Varga noted that the number of home construction permits issued last year exceeded 31,000, and said that that number was expected to further increase this year. The government’s aim is to help increase the ratio of home construction within the sector to above 10-12 percent.

ING Bank chief analyst Péter Virovácz noted that the marked January rise had come on a low base, but said a 20 percent annual increase in the sector could add a full percentage point to GDP growth. The fact that some 40 percent of construction industry companies complain of a labour shortage may pose a challenge to filling the sector’s big order stock, he added.

Source: MTI