MAKE Consulting says that demand from a growing corporate and industrial class of off-takers in the U.S. and improved market confidence in Iran have had the largest impact on its global 10-year outlook. As such, the market research firm bumped up its outlook by a 2% upgrade in the U.S. and a 114% upgrade in Iran to influence a global upgrade of 0.3%.
Although near-term upgrades in the U.S. and markets in northern Europe increase three-year growth projections by 1%, the profile of global growth over 10 years remains consistent with the report's second-quarter analysis, notes MAKE.
Policy momentum in the U.S. in the third quarter provides further optimism for growth, both in the near term and in the long term, but largely represents a potential upside to MAKE's base forecast that does not assume an extension of the production tax credit.
In Europe, sub-regional macro and policy activity will cause isolated adjustments throughout the 10-year outlook but will not have a significant net impact compared to the second quarter. The lifting of economic sanctions in Iran is the largest contributor to a 4% increase in the outlook for the Middle East and Africa, according to MAKE.
China recorded a strong first half relative to growth in other markets but will have to post an even bigger second half to reach the record level of growth anticipated for this year. The outlook stays consistent with the second-quarter analysis, as MAKE expects order intake and installation activity to continue at a rapid pace through the third quarter.
Excluding China, the outlook for Asia Pacific is downgraded by 0.1% compared to the second quarter, primarily due to minor project adjustments in markets other than India.
Lastly, MAKE notes that overall demand in China accounted for more than one-third of global order intake in the first half, and new order capacity for offshore projects increased by more than 200%, year over year, primarily due to demand in China and Germany.