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Portugal Construction Sector SWOT and PESTLE Analysis

ID : 521213753| Feb 2023| 19 pages

COMPANY PROFILE -Portugal Construction Sector

Business Sector :Building construction (residential and non-residential), Infrastructure construction, and Industrial construction

Operating Geography :Portugal, Europe

About Portugal Construction Sector :

The Construction sector is categorized into building construction (residential and non-residential), Infrastructure construction, and Industrial construction. The broad constructions sector has the following categorizations:

1. Manufacturing
2. Narrow Construction
3. Real-estate activities
4. Architectural and engineering

It is projected that the Portuguese construction industry would grow by 4% this year and will register an annual average growth of 1.9% between 2022-2025. The Government’s focus on developing the country's infrastructure will be boon to the industry. Growth will mainly be driven by the public and private sector investments in both building and civil engineering works.

The Portuguese construction industry grew at 3.2% y-o-y in the second quarter of 2021, preceded by a growth of y-o-y 5.1% in Q1 2021 and y-o-y 4.3% in Q4 2020, according to the data released by Instituto Nacional de Estatistica (INE).

Portugal Construction Sector Revenue :

Competitive Analysis of Portugal Construction Sector

SWOT
PESTLE
The SWOT analysis for Portugal Construction Sector is presented below in a matrix followed by the detailed analysis report:
Strengths
Weaknesses
1. Increase in Innovation Performance of construction sector
2. Third highest contributor to GDP of Portugal
3. Portuguese Construction Industry provides employment to a large chunk of population		1. Decline in the number of enterprises dealing in the broad construction sector
2. Time and cost of obtaining construction permits and licenses is high
3. Emerging gap in the Portuguese market for the project management role
Opportunities
Threats
1. Access to finance for SMEs sees gradual increase
2. Capitalizer Credit Line for SMEs 2018-COVID-19, implemented by IAPMEI
3. IAPMEI Specific Support line for Medium-sized
companies, small mid-caps and mid-caps
1. Decreasing turnover of construction sector
2. The construction cost index for residential buildings experiences a 10% rise
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Detailed SWOT Analysis of Portugal Construction Sector

Strength

1. Increase in Innovation Performance of construction sector: Portugal is classified as a ‘Moderate Innovator’ according to the European Innovation Scoreboard 2021. Its innovation performance has increased over the 2014-2020 period. According to the report, Portugal’s main strengths lie in its attractive research systems, digitalization and use of information technologies. The three indicators due to which Portugal was adjudged ‘Moderate Innovator’ are foreign doctorate students, international scientific co-publications, and job-to-job mobility of HRST. On the other hand, the reasons why its performance decreased are reduced performance on the indicators using innovation survey data, hiding strong performance increases on tertiary education, Government support for business R&D, ICT specialists and Environment-related technologies. Portugal has below average shares of in-house business process innovators. Portugal’s moderate performance in innovation is also reflected in the construction sector, where business enterprise R&D expenditure (BERD) was well above the level set in 2010, but the expenditure on professional, scientific and technical activities continuously decreased over 2010-2014, dropping from EUR 104.8 million to EUR 51.8 million in 2014.

The remaining section under "Strength" is available only in the 'Complete Report' on purchase.

Weakness

This section is available only in the 'Complete Report' on purchase.

Opportunity

1. Access to finance for SMEs sees gradual increase: Portugal’s entrepreneurial ecosystem is based on tech-based start-ups and is supported by vouchers to endorse entrepreneurial projects at the ideas stage and training activities. Construction is a highly fragmented industry with more than 99% of businesses categorized as microenterprises or SMEs with relatively low profit margins, quality and safety issues, a high rate of low-skilled labor, and a low level of innovation and development. Access to finance is still the biggest concern for 9.1% of Portuguese small and medium-sized enterprises (SMEs) (when compared to 9.9% EU-27 average). There has been a gradual improvement in credit conditions. 4.7% of SMEs that applied for a loan saw their application rejected in 2020, compared to the 6.3% at the EU-27 average.

The remaining section under "Opportunity" is available only in the 'Complete Report' on purchase.

Threat

This section is available only in the 'Complete Report' on purchase.

Major Competitors :

  • Mota-Engil
  • Hilti Group
  • Vinci
  • Acciona
  • Aker Solutions
  • Vectren
  • Ferrovial
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References used in Portugal Construction Sector SWOT & PESTLE Analysis Report

1. https://tradingeconomics.com/portugal/gdp-from-construction
2. https://www.giiresearch.com/report/gd265117-construction-portugal-key-trends-opportunities.html
3. https://www.statista.com/statistics/432461/number-employees-construction-industry-portugal/
4. https://tradingeconomics.com/portugal/employment-construction-eurostat-data.html

The detailed complete set of references are available on request in the 'Complete report' on purchase.

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SWOT & PESTLE.com (2024). Portugal Construction Sector SWOT and PESTLE Analysis - SWOT & PESTLE.com. [online] Available at: https://www.swotandpestle.com/portugal-construction/ [Accessed 25 Apr, 2024].

In-text: (SWOT & PESTLE.com, 2024)

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Portugal Construction Sector SWOT and PESTLE analysis has been conducted by Kenishaa M and reviewed by senior analysts from Barakaat Consulting.

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