The volume of public construction contracts last year fell to a five-year low

Prague - Public investors announced tenders for construction work worth 94.6 billion crowns last year, which is a year-on-year decrease of 29.3%. This is the lowest value in the last five years. The number of tenders dropped by 32.2% year-on-year to 2,939. This is according to an analysis conducted by CEEC Research based on data published in the public procurement bulletin at the end of last year.

"The data essentially confirms our long-term opinion. Journalists repeatedly publish information about the growth of construction and favorable prospects. Unfortunately, except for a few specific fields, such as railway construction, this information does not match reality," said SMP CZ CEO Martin Doksanský.

According to him, politicians should prevent any possibility of retroactive questioning of already issued zoning decisions backed by a positive environmental impact assessment (EIA). According to Prime Minister Bohuslav Sobotka (CSSD), there are 64 important transport projects in the Czech Republic for which the European Union requires new EIA assessments. Any delays would, according to the Prime Minister, also affect the drawing of European funds, which is about 90 billion crowns. "This could lead to another significant reduction in the volume of contracts awarded for 2016 and endanger many construction companies," Doksanský added.

In December 2015, public investors announced 165 tenders for construction work amounting to 10.3 billion crowns. In terms of volume, this was the second strongest month of the last year after July, when tenders amounting to 10.5 billion crowns were announced. However, in year-on-year comparison, the value decreased by 3.7%, and the number dropped by as much as 19.5%. "Last year, companies focusing primarily on the reconstruction of transport infrastructure performed well. There were not enough projects for land construction or large investment units, and the competition for them among companies continues," added the director of the development company O.M.C. Invest, Mário Červenka.

Of the announced tenders for the entire year, state investors awarded 60% to specific construction companies. In terms of total volume, this represents half of the competitions worth 47.5 billion crowns. "Despite the fact that last year the Czech Republic tried to catch up on the deficit in drawing from EU funds, the expert construction public expected dismal results. It is sad that more than a quarter of a century after November 1989, we still do not have a functional highway connection with our neighbors," concluded Metrostav CEO Pavel Pilát.