Fernando de Querol Cumbrera
Research expert covering construction, loans, leasing, savings, and debt
Construction industry in Latin America - statistics & facts
In a region as large and diverse as Latin America, the significance of the construction sector to the economy varies a lot. While construction represented over a tenth of the economy in some parts of Central America and the Caribbean in 2022, generally, the GDP share of the construction industry was lower in the largest countries of the continent. In Peru, Mexico, and Chile, the sector made up between five and eight percent of the countries’ GDP, while it amounted to less than four percent in Brazil and Argentina. Nevertheless, Brazil had one of the largest construction industries in Latin America on absolute terms that year.
Construction materials
Although labor represented over half of the costs of erecting a building in Brazil in 2023, the price of raw materials and appliances tends to be another of the largest components determining the final cost of a project. In fact, the cost of construction materials in Chile rose at a faster pace than the salaries since 2020. Some of the possible causes for that are the supply-chain disruptions, inflation, and other economic problems experienced during the past years which have had a big impact on the price of building materials.Building permits
Building permits are a good indicator of the production level of the construction sector in a certain country. For example, the number of building permits in Argentina decreased in 2023, and they authorized, in total, the construction of nearly 13.7 million square meters. The area authorized for new construction projects in Chile would suggest that in the coming years, as those projects are completed, there will be more new homes than new commercial buildings for sale. Finally, the number of housing units authorized in Colombia showed that most of the planned new apartments are for social housing.
