April 12, 2010 -
PRLog -- This quarter BMI has introduced a new data series for infrastructure and its subsectors (transport and energy & utilities). This is an effort to address a significant deficiency in the availability of globally comparable, infrastructure-
specific indicators and forecasts across a wide range of countries. BMI's new infrastructure data series enables users to quantify trends and growth patterns in the infrastructure sectors of the 35 main emerging and developed markets out of the 62 countries in BMI's infrastructure service. BMI forecasts that Taiwan's construction sector will slump by 15.33% in 2009. However, on the back of government stimulus spending, 2010 is expected to be a strong year for the sector, with growth returning to around 9%. This high rate of growth should continue until 2012, before slowing down. By 2017, BMI forecasts that the construction sector will reach a value of TWD460.6bn (US$15.4bn). A similar Vshaped recovery is expected in the infrastructure sector, which after posting a decline of 24.49% in 2009 should rebound to 17.71% growth in 2010. By 2014, the value of the infrastructure industry is forecast to reach TWD111.68bn (US$29.75bn)
. Meanwhile, it was reported in November 2009 that the problems confronting Taiwan's high-speed railway could be reduced if parent company Taiwan High Speed Rail Corp (THSRC) is successful in its aims to refinance loans worth a total of TWD382bn (US$11.93bn)
and reduce the burden of interest payments. Since the bullet train - which runs between the capital Taipei and the second largest city Kaohsiung - opened in 2007 THSRC has incurred losses of more than TWD70bn (US$2.17bn). Under a new financing agreement, the company is looking for an average interest rate of 1.8% on the loans, compared with the 2.6% average rate it currently pays. That works out as the difference between paying around TWD9.9bn (US$306.7mn)
in interest per year or TWD6.87bn (US$212.8mn)
in interest. Considering THRSC claims that losses in 2010 will stand at around TWD10bn (US$309.8mn)
, the change in interest rates could be the difference between the company breaking even or plunging further into the red. Indeed, the firm's chairman, Ou-Chin Der, claims that under the restructured package, not only would THSCR be able to pay off its loans, but it would also be able to obtain funds for further expansion. Earlier in November, the Taiwanese government took nine out of the 15 seats on the company's board, which should facilitate an increase in state-aid to help improve the company's financial structure. There was also promising news in the utilities sector this quarter. In September 2009, Taiwan's state-owned utility Taiwan Power (Taipower) unveiled a multi-billion-
dollar investment plan to upgrade and expand the country's transmission grid infrastructure. The utility is preparing the system for the anticipated recovery in manufacturing. BMI further notes that with almost 20GW of new capacity planned to come online between 2009 and 2017, new grid infrastructure will be necessary to support the power generation sector. The government of Taiwan has authorised Taipower to invest between TWD200bn (US$6.1bn) and TWD300bn (US$9.2bn) over the next six years in grid infrastructure, Bloomberg cites a company director saying.
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