Staff Writer
Construction will continue to support economic growth in 2026, though expansion is expected to slow from the rebound seen in 2025.
According to Simonis Storm, construction growth is likely to moderate to between 4% and 6% under the base case. The slowdown reflects tighter fiscal conditions and more selective private-sector investment.
Public infrastructure spending remains the main driver of activity. Investment in water, energy, transport and urban infrastructure continues to support demand.
“Projects already in the pipeline include continued upgrades to bulk water supply systems, pipeline replacement and extension projects in northern and coastal regions, electricity transmission strengthening, and renewable energy–related grid infrastructure. These projects support steady construction demand but are increasingly constrained by fiscal sequencing, procurement timelines, and execution capacity rather than funding intent alone,” the report said.
The outlook could improve if oil and gas operators and green hydrogen developers take final investment decisions.
Projects under consideration include port and harbour upgrades at Lüderitz by Namport, as well as road and rail links connecting Lüderitz to inland industrial zones and the national road network.
Bulk water and desalination infrastructure form part of the pipeline. This includes new or expanded desalination plants in Swakopmund and Lüderitz and related pipelines.
Electricity generation and transmission upgrades are also planned. NamPower is expected to expand substations and strengthen the grid to support large industrial users. Renewable energy projects such as solar and wind developments are also under consideration.
Further construction demand may arise from worker accommodation, housing and municipal services linked to new projects.
Private-sector activity is expected to align with public infrastructure already in planning and execution. This includes port development, power transmission expansion, water security projects and logistics corridor upgrades.
“The geographic concentration of these projects implies that construction activity would be highly localised, with southern regions experiencing a disproportionate uplift relative to the rest of the country,” the report said.
Outside energy-related projects, private residential and commercial construction is expected to remain selective.
“Although borrowing costs are lower than in 2023–2024, elevated unemployment and household affordability constraints limit the scope for a broad-based residential boom. As such, the base-case outlook for construction in 2026 remains moderate, with significant upside contingent on energy-related FIDs and effective project coordination.”
