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SARAJEVO, BOSNIA-According to a study put out by PMR, the Western Balkan construction market will be further diminished during 2009. In the study, titled The construction industry in the Balkans 2009: Serbia, Croatia and Bosnia and Herzegovina. Development forecasts for 2009-2011, it is estimated the growth rate will drop from 12% in 2008 to 6% by the end of this year.

The Western Balkans is made up of Serbia, Croatia, Bosnia and Herzegovina. By the conclusion of this year, the construction market here will be worth $9 billion. This 6% growth is a much smaller acceleration than the previous two years; with 2008 seeing a 12% increase and 2007 charting a 19% growth rate.

PMR executives found that, “More robust growth will be possible no sooner than 2011, and this will be fuelled mostly by a striking increase in Croatian construction, as a result of EU membership and more substantial EU funds.”

Although, while commercial real estate will continue to decline in the next couple years, civil engineering will grow; thanks, in part, to the need to replace bridges, roads and other transportation infrastructure due to conflict in this area of the world over the years.

“In recent years the Balkan construction market experienced rapid growth supported by the influx of private and public funds,” says Bartlomiej Sosna, a construction market analyst at PMR. “We expect the financial crisis to have a limited impact on the Balkan construction market, as the inflow of foreign private capital in recent years was much more subdued, in comparison with other Eastern European countries. In addition, this market is at a very early stage of development, with many huge road and railway development projects planned for the region, and part of the funding provided by the European Bank for Reconstruction and Development.”

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