Evidence of such a closed market can be seen from the huge domestic numbers being reported by major Chinese contractors. In 2008, China launched a two-year, $586-billion infrastructure stimulus plan to maintain its economic growth.

However, most of this spending is staying with giant domestic contractors. China Railway Group Ltd., China Railway Construction Corp. Ltd., China State Construction Engineering Corp., China Communications Construction Group and China Metallurgical Group Corp. report a combined total of $326 billion in new contract awards in 2009. Of that, 85% was from domestic projects.

But the other Asian giant, India, is proving more attractive. Hochtief has “scouting teams,” lured by India’s huge highways upgrade program, much of it procured through P3s. But Renaissance Construction has decided the Indian market is not a good match for the firm at this time, and it will continue to focus on Russia, the former Soviet republics (CIS), and Arabic-speaking countries, says Ilicak.

Oil-rich nations, including those in central Asia, are “still very attractive,” says Cote. Bouygues’s targets include Abu Dhabi. There is “ample work” in Qatar and Saudi Arabia as well, adds Lütkestratkötter. Business in Dubai “is not going to improve any time soon, [but] it’s not completely dead,” says Tyler.

After a lull in the oil-and-gas market, investment has spiked. The Kuwaiti-based Organization of Arab Petroleum Exporting Countries now estimates member countries are expected to invest $70 billion in energy projects by 2012 to boost crude-oil production capacity, according to Evgeny Zagorodny, vice chairman of Russia’s PJSC Stroytransgaz. “The bulk of investments would be based in UAE, Saudi Arabia, Kuwait, Qatar, Algeria and Egypt,” he says.

In 2009, Korean contractors made major inroads in the Middle East oil-and-gas plant market, with total award volume reaching more than $30 billion, says Dae-Yung Ahn, executive vice president of corporate strategy and planning for Samsung Engineering. Samsung “ranked on top” with new orders in 2009 amounting to $8 billion, he says.

Samsung Engineering now is planning to diversify. “Although the Middle East was our primary market, we entered the North African market last year and we aim to diversify into other regions such as Libya, Egypt, Central America and the CIS,” says Ahn. The firm also plans to move into the industrial and infrastructure sectors, including powerplants, steel mills, desalination plants and water treatment facilities, he says.

Not all of the investment in the Middle East is oil-based. The Middle East, the Caspian region and Africa present the biggest opportunities, says Suhayl Shami, manager for Greece’s Consolidated Contractors Group. “These regions have a great deal of catching up to do and are building their physical and economic infrastructure,” he says.

The boom times in the Middle East and North Africa have drawn contractors from around the world. Shami is concerned about the recent trend of government-supported Far East contractors entering the Middle Eastern and Africa markets. “We think that direct or indirect [political or financial] government support undermines the fairness of the bidding process and limits fair competition,” he says.

Worries in Europe

In the EU, Poland is “maybe the only country … which had a positive GDP,” says Karlström. “It’s very competitive.” Nordic countries, especially Sweden, are now Skanska’s “strongest” market, he says. Otherwise, the region has “significantly slowed down,” adds Lütkestratkötter.

The European trend for public spending cuts “is really a problem,” says Cote. Commercial construction in Bouygues’s hometown, Paris, is busy, while work in the provinces “is back to 2006 levels.” But signs of industrial growth in Germany raises Lütkestratkötter’s optimism.

Spending cuts in the U.K. will affect parts of Balfour Beatty, but new growth sectors, such as powerplants, offer compensatory opportunities, believes Tyler. The U.S. is “a much more stable market than we see elsewhere,” he adds. “But it’s not going to be … easy.”

In the U.S. “forecasters … say the market should stabilize this year,” says Lütkestratkötter. But even in the current climate, he is content with the performance of Hochtief’s subsidiaries, Turner Construction Co. and Flatiron Construction.

“We see a lot of projects coming to the [civil-sector] market,” says Karlström. “But it’s very competitive.” He believes the introduction of the new health-care plan will create projects. Skanska plans to expand to the west coast organically and through acquisitions, says Karlström.

In Latin America, Skanska is “more geared toward the energy sector,” says Karlström. Interest in renewable energy is growing while infrastructure and mining-related work is picking up, he adds. Balfour Beatty has done “bits and pieces” of work around Latin America. “We [now] are seeing some opportunities, largely through our rail business,” says Tyler.

Competition in the international market has some contractors becoming increasingly aggressive in their bidding. “This may definitely lower the prices, reduce the quality and may leave incomplete projects, failed contractors and litigation,” says Ilicak of Renaissance.

The market will rebound, but many international contractors are wary of inflation when this happens. “The main factors that concern us about the international construction market in the near future are inflation and currency fluctuations,” says Shami of CCC. He says the Chinese yuan is getting stronger against other currencies, and this could cause a worldwide increase in materials prices.