Report
Executive Summary
You have downloaded a PDF of BMI's latest views on the market, summarising the key findings that are
assessed in detail in the new report, as well as the full report Table of Contents.
Find out more about this report by contacting one of our experts on +44 (0)20 7246 5170
SWOT
Infrastructure SWOT
Industry Forecast
Latest Updates
10
Structural Trends
10
18
27
28
35
36
40
41
41
Rewards
41
Risks
42
MENA Infrastructure RRI: Oil Prices And Security Remain Key Risks
43
49
Market Overview
50
Competitive Landscape
50
52
Company Profile
53
53
Methodology
56
56
Sector-Specific Methodology
57
61
Sector-Specific Methodology
62
62
63
BMI View : The post-sanctions investment uptick we have seen in 2016 will gather pace in 2017, as an improving
macro-economic outlook lays the foundation for broad-based, sustained c onstruction sector growth. The i ndustrial
construction, oil and gas pipeline, and power sectors will emerge as bright spots, with the robust structural demand
serving to entice international investors.
Latest Updates And Structural Trends
We expect robust construction sector growth as the sector expands in tandem with a growing economy, with
heightened levels of international investment, in the wake of sanctions easing, driving 7.5% growth in 2017.
Iran's energy and utilities space will outperform the country's wider construction industry in 2017 on the
back of projects like the Bushehr nuclear power plant, a USD10bn undertaking which broke ground in
September 2016. Construction duties will be handled by Russia-based Rosatom and is expected to be
complete in ten years.
An unravelling of the 2015 nuclear accord remains the most significant downside risk to our outlook, as our
optimistic view of Iran's construction growth is heavily predicated on the absence of sanctions (which would
be reinstated were the agreement to collapse). However, our core view remains that the nuclear account will
continue to hold over 2017.
Construction And Infrastructure Industry Data (Iran 2015-2025)
2015e
2016f
2017f
2018f
2019f
2020f
2021f
2022f
2023f
2024f
2025f
Construction
1,155.3 1,361.6 1,572.7 1,807.0 2,054.6 2,297.0 2,648.4 3,051.0 3,389.7 3,945.6 4,415.1
industry
value, IRRtn
Construction
Industry
Value, Real
Growth, %
y-o-y
2.79
7.86
7.50
6.90
5.70
4.30
5.30
5.20
5.10
6.40
5.90
Construction
Industry
Value, % of
GDP
9.5
10.1
10.1
10.3
10.4
10.3
10.6
11.2
11.4
12.1
12.4
Risk/Reward Index
The lifting of international sanctions continues to have a positive impact on Iran's overall Risk Reward Index
(RRI) score. Iran scores 48.0 out of 100 on the RRI this quarter, an improvement over its pre-sanctions score,
yet still trailing the regional average of 53.6.
Iran registers its worst score in the Industry Risks pillar of the RRI with a score of 35.0, reflecting the high
barriers to entry, opaque tendering process, and lack of competition in its infrastructure market. We expect
Iran's competitive landscape to diversify considerably as the lifting of international sanctions allows foreign
players to return and highlight this as an area in which Iran is likely to improve in future.
For more information, please contact us at: enquiry@bmiresearch.com
+44 (0)20 7246 5170
Iran's Country Risk score holds fast at 46.2, a score considerably below the regional average of 55. Despite
the lifting of sanctions, structural problems with its political system remain - the country suffers from
endemic levels of corruption, a weak institutional framework and political interference in the judiciary is rife.
Infrastructure Risk Reward Index (Iran 2016-2016)
Geography
Risk/Reward Index
Rewards
Industry
Rewards
Country
Rewards
Risks
48.0
50.7
55.0
42.7
42.3
Iran
Source: BMI
46.2
Thank you for downloading BMI's latest views, we hope you found the information insightful.
To find out more about how the extensive views, analysis and forecasts contained in the full report will
help your company or to discuss your specific information needs please contact one of our experts on
+44 (0)20 7246 5170