News Archive
“Go to America,” the world’s smart builders told
Released on 01/07/2009
Of all the G20 nations, the USA will provide the biggest opportunity for inbound construction projects in the future, according to a new study.
Never mind China, India and Saudi Arabia – a report released this week by UK accountancy firm BDO Stoy Hayward says that despite high levels of red tape and taxes the US is the place to target for international expansion because of its huge pipeline of upcoming construction projects.
Following in second and third places were the UK and Canada.
Tax regimes, transparency and planned public expenditure were considered in the ranking. In the US, the government’s economic stimulus package, which proposes to inject around US$150 billion for infrastructure over the next three years, was a key factor.
Richard Kelly, head of construction at BDO Stoy Hayward, said: “While the effort required to break into the USA and other international markets may appear to be daunting, even taking just a tiny nibble of this enormous cake could be enough to satisfy the greediest of construction business appetites.”
Following close behind the USA to take spots number two and three in BDO Stoy Hayward’s “G20 Heatmap” were the UK and Canada respectively, suggesting that the greatest opportunities are not always in those territories touted as the next big thing.
“The idea that the UK and Canada could offer more potential than China, Saudi Arabia or even India is startling,” says Kelly. “It clearly demonstrates the importance of carrying out a rigorous analysis of opportunities and balancing them with the barriers to entry.”
“Clearly there are opportunities to be had in the East and Middle East, but the combined clout of the top three countries makes it impossible to ignore the potential lying west of mainland Europe,” continues Kelly.
So what makes an attractive market?
The study considered a number of factors which make a country attractive for inbound construction:
- The pipeline of public and private projects;
- The country’s ability to pay for those projects:
- Tax issues: the flexibility of using shareholder debt, the ease of obtaining tax relief, the time required to prepare tax returns and the overall number of tax payments;
- The strength of a country’s credit ratings;
- Ease of doing business/ absence regulatory barriers; and
- The level of transparency and the absence of corruption
The ranking contains a number of surprises: for instance, it places India and South Korea as more attractive destinations than France and Germany.
BDO Stoy Hayward’s G20 Heatmap rankings are as follows:
USA
UK
Canada
China
Japan
Saudi Arabia
Australia
India
South Africa
South Korea
France
Turkey
Germany
Indonesia
Italy
Russia
Brazil
Mexico
Argentina
BDO Stoy Hayward is a UK member firm of global accounting network BDO International.
