Watch: Chinese firms cement dominance of world’s top 10 construction companies
16 August 2023
Image: estherpoon via AdobeStock - stock.adobe.com
Chinese construction companies cemented their dominance among the world’s biggest construction companies, despite operating against a more challenging backdrop in their home market.
That’s one of the key takeaways from International Construction’s latest ICON 200 list, which tracks the biggest 200 construction companies across the globe.
Chinese companies once again took all five of the top spots in the ICON 200 list, with top firm China State Construction Engineering (CSCEC) increasing its annual revenue by 4% to US$303 billion and taking first place in the table.
In total, the top 200 construction companies in the list generated annual revenues totalling US1.968 trillion.
Of that figure, 44% was generated by Chinese companies alone (see revenue share below).
A new animated bar chart, produced using 20 years’ worth of data from the ICON 200 shows just how much the annual revenues of Chinese construction companies have grown relative to contractors based in other regions.
In 2004’s list, based on companies’ annual revenue for the 2003 full year, not one Chinese company occupied a spot in the top 10. Instead, French firms Vinci and Bouygues took first and fourth places respectively.
Swedish contractor Skanska was in second place, and US company Bechtel in fifth. Five of the top 10 companies were Japanese.
Fast forward 20 years and Vinci, while still boasting a huge revenue of US$64.9 billion, has dropped to sixth place. Bouygues’ construction division is one place behind it in seventh with $46.6 billion in revenue.
Much of the Chinese construction companies’ revenue derives from their domestic market of China.
But their performance also underlines the strength of the country’s Belt and Road Initiative around the world, given that construction activity in China itself fell in 2022.
China’s government has continued to adapt its pro-active fiscal policy by increasing public investment in infrastructure projects, issuing bonds at the local level to fund the projects although progress bringing projects to fruition has been slow.
China’s real estate sector has also remained depressed, with weak sales and huge outstanding debts.
Nonetheless, there are signs of recovery on the horizon in the Chinese market in 2024 and 2025.
In a trading update in July, CSCEC itself reported that the total value of its newly signed construction contracts between January to May this year had reached CNY 1,425.3 billion (US$196.6 billion), up 11.3% year on year.
That included an 11.5% year-on-year increase in housing construction contracts, totalling CNY 1,046.5 billion ($144.3 billion).
Infrastructure construction rose by 10.1% year on year, to CNY 371.9 billion ($51.3 billion).
Whether other construction companies in the country manage to generate similar increases in business remains to be seen.
But Chinese construction companies are likely to continue to occupy the top of the list in terms of revenue for some time to come.
Revenue share
Whichever way you look at it, it is clear that Chinese construction companies are the driving force behind the revenue total in the ICON 200.
There are nine Chinese companies on the list, with two of them increasing their placing, five staying the same and just two of them dropping a positing.
Between them, thee nine contractors generate $893 billion.
Put another way, they account for 44% of the total amount of the ICON 200.
But that share was just 2.6% two decades ago in 2004, when Japanese construction companies accounted for the lion’s share of the revenue in what was then the ICON 100 (it expanded to tracking 200 companies from 2006 onwards).
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