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Industry, construction and exports on the brink of recovery

To be able to monitor trends in the economy precisely, one needs to have precise GDP forecasts, but also to thoroughly analyse the situation in the abovementioned sectors. Below we have briefly outlined our expectations for 2025 regarding the construction, exports and industrial production.

A recovery in public investments and a related boom in the construction sector will be the key driver of economic growth acceleration that we expect to see in 2025. Demand in the construction industry is still strongly limited by lower absorption of EU funds. Based on the timeline of absorption of EU funds in 2014- 2020, we expect the absorption to accelerate markedly in 2025, and its high momentum will be carried over to 2026. We also assume that the recovery in public investments in 2025 will be driven further by the cumulation of investment projects carried out as part of the National Recovery Plan (they must be settled in 2026). In real terms, we expect a two-digit growth in public investments given also last year’s low base effects. Activity in the construction sector will be boosted by investments in infrastructure.

Furthermore, the situation in the housing construction sector is gradually improving, which is reflected in an upward trend in the number of homes in construction and housing starts seen over the last couple of months. We expect the housing construction to keep on boosting the activity in the construction sector in 2025. In the MACROmap of 23/09/2024, we presented our forecast for the number of released dwellings. Based on the results of econometric modelling, we had been expecting the annual number of released apartments to stabilise at ca. 125k in 2024-2025, below the value recorded in 2023 (142k). We believe that we will see a strong growth in supply in the housing market only in H2 2025.

 

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Credit Agricole Bank Polska S.A. ul. Legnicka 48 bud. C-D 54-202 Wrocław www.credit-agricole.pl

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Jakub BOROWSKI Główny Ekonomista Chief Economist ul. Żwirki i Wigury 18a, 02-092 Warszawa tel.: +48 22 573 18 40 e-mail: jakub.borowski@credit-agricole.pl

Frederic LUSTIG Dyrektor Pionu Klientów Korporacyjnych Head of Corporate Clients Division ul. Żwirki i Wigury 18a, 02-092 Warszawa tel.:+48 22 434 30 82 e-mail: flustig((@))credit-agricole.pl

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