Photo de Thomas Bauer, Président de la FIEC

A word from FIEC

Interview with Thomas Bauer, President of FIEC (European Construction Industry Federation)

The trends that we see are all converging towards the need for stronger cooperation and interaction between all the stakeholders in the construction value chain. Events like INTERMAT are therefore extremely useful opportunities to build and/or develop further such partnerships.

How do you envisage the COVID-19 post-crisis period in your sector of activity?

The Covid pandemic hit the construction sector quite hard, although the situation differed significantly from one country to another. In some countries, construction activities were more or less completely stopped either because a lockdown was imposed or simply because it was impossible to run construction activities. This was the case in Italy, Spain, France and Ireland for example. In contrast, in other countries like Germany, the Netherlands or the Nordic countries, activities continued.
However, even in those countries where activities continued more or less normally, construction companies were confronted with many practical obstacles such as the difficulties in getting products and material, finding the protective equipment for their workers, organising the worksites in compliance with the sanitary restrictions; and finding workers, because many of them returned to their home countries at the beginning of the crisis.
Now things are little by little going back to normal although the sanitary restrictions that we have to put in place on worksites require a completely new organisation of the process, with losses of productivity. They also generate additional costs for companies.
Within this framework, the speed and level of recovery will vary significantly from country to country, not only because of the differences in the impact of the crisis, but also because it will depend a lot on how Member States develop and implement their national recovery strategies and how they make best use of the available financial means and instruments.

In this context and after a positive year in 2019, how does 2020 and the years to come look? 

It is difficult to estimate the amount of losses incurred, but overall, we expect at the end of 2020 a drop in activity between 15% and 20% compared to 2019.
From the information that we are receiving from our member federations, there are significant concerns for 2021 and 2022. Some of the on-going projects will help avoid an even stronger decrease in activity this year, but there are signs that private investments could drop significantly, and it is not clear at the moment how public investment will evolve. The current temporary measures that allow Member States to support the economy, for example the suspension of the requirements of the EU Stability and Growth Pact or the flexibility allowed in the framework of State Aid legislation, will probably come to an end at the end of 2021. In this respect, it is not clear how countries with high public debts, like Italy or Belgium for example, will be able to make full use of the funding that is being made available within the EU budget or how they will be able to get help from the financial market.
At the same time, private investors are in a “wait and see” position right now, which will also affect private construction (i.e. office buildings, etc.) in the medium and long term.
The European Commission’s priorities, namely the environmental (the EU “Green Deal”) and digital transitions, offer significant opportunities for the construction sector. After the summer break the European Commission will present a proposal for a “Renovation Wave” focussing on the energy efficiency of buildings, which will require massive investment.
It will be crucial for our sector to put in place all the necessary means and measures to make the best possible use of such opportunities.
In addition, it is clear that the digital transition will transform our industry, as well as the relations and interactions throughout the whole value chain. In this respect it is important to ensure that nobody is left behind.
Finally, proper and adequate training and upskilling of our workforce is needed.
One thing is clear, these ambitious political objectives cannot be achieved without the direct involvement of the construction sector.

What are the objectives would you set for the world afterwards?

When we look at the proposal of the European Commission regarding the EU Recovery Plan, we see that all the financial means and instruments that will most likely be put in place continue to focus around the 2 main political priorities set by the Commission at the beginning of its mandate, namely the environmental and digital transitions.
Whether we like it or not they will shape our economies and our societies and our clients, no matter whether private or public, will simply impose them on us. We therefore need to integrate them as quickly as possible in our business models.
In this respect we have huge challenges, but also significant opportunities ahead, because the construction sector will play a crucial role.

What are the growth prospects and the main areas of innovation in your sector in order to accelerate the dynamics of major projects in France and in the world?

The main areas of innovation are focused on two developments in our industry, namely sustainable construction and digitalisation.  The former is linked to the European Green Deal and has the potential to significantly support its implementation. On the horizon we have innovation relating to the decarbonisation of the industry. The area of great potential in terms of buildings is energy efficiency, but this is not a new development and we have been required to ensure that new build meets energy performance regulation standards for some time already. 
Where we expect to accelerate is in the reduction of emissions in other activities such as moving towards greater electrification of construction sites where this is feasible and the introduction of new power sources, such as hydrogen-fueled generators. In addition to decarbonisation, the industry is moving even further towards circular construction, which means that more sustainable materials are used, installation methods are more geared towards recycling and reuse when the building is eventually renovated, or its use changed. Digitalisation of construction has been happening for a while, but here again we see further potential for the adoption of digital technologies, such as the increasing use of robots, drones, exoskeletons and ultimately Artificial Intelligence. We also expect to see more widespread adoption of Building Information Modelling (BIM) and more efficient processes, improved partly by faster processing of data from more effective IT infrastructure.

What can the European companies you represent expect from INTERMAT in terms of development and expertise to project themselves positively into tomorrow's world?

As I mentioned above, the trends that we see are all converging towards the need for stronger cooperation and interaction between all the stakeholders in the construction value chain. Events like INTERMAT are therefore extremely useful opportunities to build and/or develop further such partnerships. In order to make the best possible use of digital technologies, for example, it is crucial to have such a dialogue between producers and users.
Given the increased complexity of the whole process, the dialogue between all the stakeholders will help us in exchanging and combining our expertise and competences and thereby maximising the added value of our cooperation, for the benefit of our clients and our company.

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