Singapore Infrastructure Report Q4 2012: New Research Report Available At Fast Market Research

Recently published research from Business Monitor International, "Singapore Infrastructure Report Q4 2012", is now available at Fast Market Research

by Bill Thompson

(WireNews+Co) - Boston, MA - 24 October 2012

BMI View: Construction activity continues to surprise on the upside. Real growth for the construction industry beat government estimates to reach 6.9% year-on-year (y-o-y) in Q112, driven by a surge in residential building activity. With residential activity expected to remain robust over the rest of 2012, we have revised up our forecasts, with real growth for the construction sector set to reach 5.1% in 2012 (down from a previous forecast of 3.8%). However, barring a global economic meltdown, we expect construction activity in Singapore to slow to a more sustainable level, with real growth forecast to reach 3.5% in 2013 (up from a previous forecast of 3.2%).

The key drivers affecting construction growth are:

- In April 2012, SMRT announced that it will invest SGD900mn (US$724mn) to upgrade the country's rail network, reports Railway Technology. A railway renovation programme will be introduced in phases between 2012 and 2019, including a complete overhaul of the signalling system. It is intended to improve the quality of the rail service offered by SMRT and will be partly financed by the Singaporean Land Transport Authority.
- In May 2012, SP Power had invited bids for engineering and construction work on two tunnels to carry power cables under Singapore. The company was also seeking to raise SGD1.5bn (US$1.2bn) to finance the construction of both tunnels. The company had hired six banks to help it in arranging the project facility. The loan is likely to be raised in order to include a SGD200- 300mn (US$160-240mn) cost overrun facility, which will be necessary if project costs exceed expectations. The project entails the construction of two tunnels running 18.5km north-south and 16.5km east-west across the country, which are to be constructed in five to seven years.
- In June 2012, Malaysia's Land Public Transport Commission and Singapore's Land Transport Authority awarded US engineering firm AECOM Technology a contract for the design and engineering study of the proposed RTS Link. Under the US$42mn contract, the company is to undertake an architectural and engineering study for the project, which is likely to involve an investment of around MYR30bn (US$9.7bn).

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