Tropical Timber Market Report III

2018 seems to be a year of further growth, but policy challenges and market consolidation may cause disruptions in the tropical timber markets around the world. To start off the year, ITTO shares insights on the happenings in different countries and regions.




Mixed start to 2018

2018 started mixed in Malaysia. On the one hand there was an encouraging growth projections from the World Bank but on the other there remains a risk of a trade conflict with the EU over oil palm.

Economic growth in Malaysia accelerated through 2017 with year-on-year growth projected to be 5.8 percent, the highest annual growth rate since 2014. Growth is forecast to remain strong at 5.2 percent for 2018 according to the latest Malaysia Economic Monitor, from the World Bank.

The report said “accelerated growth has been fuelled by strengthening domestic demand, improved labour market conditions, and wage growth, as well as improved external demand for Malaysia’s manufactured products and commodity exports. Capital expenditure has also increased due to higher private and public investment.”

According to the press release from the Bank strong growth prospects pave the way for additional reforms such as policies to boost productivity and address constraints such as a lack of competition in key markets and critical skills deficits.

The year also started with an ominous warning of a potential trade war. Plantation Industries and Commodities Minister Mah Siew Keong Malaysia said if the European Union moves to ban palm oil use in biofuel mix Malaysia will have no choice but to retaliate.


Added value products from oil palm stems

In other oil palm news, the Plantation Industries and Commodities Minister said some 5.7 million hectares of oil palm estates undergo replanting after 25 years and that annually there are between 80,000 ha and 100,000 ha of oil palm plantations felled yielding around 18 million palm stems.

This is a valuable, but largely underutilised raw material said the minister when opening the Fibre and Biocomposite Centre (Fidec 3) and Furniture Durability Testing Laboratory at the OlakLempit furniture complex in Banting.

Fidec 3 is an initiative of the Malaysian Timber Industry Board (MTIB) to provide testing services to the industry and higher learning institutions as well as aiding in the commercialisation of biocomposite products.

Last year, biocomposite products manufactured into plywood, chipboard and wood-plastic composites contributed 29 percent of the total export value of the national timber industry.


Export growth weighed down by strong ringgit 

Malaysia’s export growth slowed to 14 percent year-on-year weighed down by the strengthening ringgit. 

The Malaysian ringgit averaged RM4.16 to the US dollar in November 2017, up from RM4.22 towards year end and is expected to strengthen further.




2018 plan for teak and hardwood sales

In a recent series of promotion activities and in a media release, Denaldy M. Mauna, President and Director of Perum Perhutani, the Indonesian state owned Forestry Company, has invited consumers to use Perhutani wood.

Perhutani's marketing team presented its timber production plan for 2018 indicating that it will have available some 340,000 cubic metres of plantation teak and 416,000 cubic metres of non-teak wood such as pine and mahagony.

The 2018 plan outlines the price structures to be applied and provides details of the costs of certification and the price range depending on size and log quality. 

Perhutani's timber sales are also retailed through online sales and up to November last year online sales reached Rp1.1 trillion.


Bank Indonesia optimistic on growth prospects

Bank Indonesia (BI) has forecast that the economy is set to expand by over five percent in 2018 as investments and exports are expected to increase further.

BI Governor, AgusMartowardojo, said he is confident that the private sector will continue to expand investment and raise wages which will encourage greater consumer consumption in 2018.


2018 exports set to rise

According to Rufi'ie, Director of Forest Product Processing and Marketing in the Ministry of Environment and Forestry, wood product exports rose just over one percent in 2017. However, he pointed out that in terms of tonnage, 2017 exports dropped.

Despite this sobering news timber sector entrepreneurs are optimistic that they will increase exports in 2018 said the Chairman of the Association of Indonesian Sawn Timber and Processed Timber (ISWA).


According to ISWA, processed wood sales up to October in 2017 amounted to US$1.72 billion which, says Mr. Soewarni, could grow to US$2 billion. 

Mr. Soewarni considers the export of FLEGT licensed timber will improve the competitiveness of Indonesian wood products because the product is recognised as coming from legal timber.

In related news, the Indonesian Minister of Industry, Airlangga Hartarto, has said Indonesia's exports face some obstacles in international markets such as high import duties. 

According to Airlangga, efforts must be made to increase the number of trade agreements to bring tariffs down.




Foreign investment target success

Between April and December 2017 the value of incoming foreign investment topped US$5 billion or around 95 percent of the target.

The Myanmar Investment Commission (MIC) has issued 174 investment licenses covering US$4.8 billion and the balance was in the Thilawa Industrial Zone where Japanese investment was the greatest. 

The MIC has devolved some authority to State and Regional agencies and at the regional level 21 licenses were issued to investors from China, Singapore, Taiwan, HongKong, Japan and Malaysia for around US$29 million.

The MIC has issued a list of manufactured products for which licenses will be issued and these are most for import substitution. The MIC will provide assistance to investors to secure land and power supplies.


Greater transparency the key to revive markets for teak

Analysts write that once again the Environmental Investigation Agency (EIA) has reminded the authorities in Myanmar that, for as long as they do not provide transparency in the domestic log flows from forest to mill, it will be impossible for teak importers to be entirely satisfied on the legality of the timbers offered for export.

Myanmar has been striving to ensure forest conservation and the production of verifiably legal timber but still cannot create a supply chain reporting system that satisfies critics and meets international standards.

The EIA has made another call for stricter control and greater transparency in the timber sector so that Myanmar teak can once again take its place as the’ king’ of timber in international markets.

Local analysts are dismayed with the latest scathing report from the EIA saying this does not reflect the reality nor give due credit for the efforts made to implement the recommendations of the report: Myanmar Timber Legality Assurance System (MTLAS) Gap Analysis of April 2017.

The latest EIA report says the pristine forests of Myanmar are under real and urgent threat. The report also says European companies are still failing in their responsibilities to satisfy the due diligence requirements of the EUTR in respect of teak imports from Myanmar.

The EIA says that the actions of some government departments in Myanmar have made it all but impossible to access information that can prove teak has been legally harvested. This means that importers of Myanmar teak find it very difficult to comply with regulations aimed at eliminating illegal timber from the supply chain.


Sale of seized logs

Recently, the Forestry Department suspended the sale of confiscated low quality hand hewn timber in a move to ensure illegal timber does not enter the supply chain.

However, confiscated timber of high quality is being sold by the Myanmar Timber Enterprise (MTE).


Co-opt local residents to help combat illegal logging

The Director of Forestry in Magwe Region told the media that the participation of the local people is essential to combat the illegal logging and to conserve the forest particularly as the Forestry Department is facing a skilled staff shortage.

He further said civil society organisations are playing an important role in calling for enhanced forest governance and their involvement in negotiations for a VPA is vital.


Support for SMEs

The Government is preparing to expand its support for the development of SMEs in the country according to Vice President, MyintSwe, who recently chaired a meeting with members of the Union of Myanmar Federation of Chamber of Commerce and Industries. 

He said the government intends to provide around 300 billion Kyats for the SME development.

In related news, the new minimum wages has been adopted at 4,800 Kyats per day. The previous rate of 3,600 was approved three years ago.

Employers in Myanmar argued for 4,000 Kyats and employees asked for 5,600 Kyats. One manufacturer from the wood-based industry sector said the change will not have a big impact on most workers in the timber sector as they receive more than the new minimum anyway. 

The impact will be greatest in the labour-intensive industries such as garment manufacturing.




GST to bear fruit over next five years

A Fitch Ratings report on the ‘Medium-Term Growth Potential in Emerging Economies’ says India is likely to achieve a GDP growth rate of 6.7 percent annually for the next five years.

Driving the steady growth says the Flitch report will be improvements in productivity stemming from recent reforms such as the introduction of the goods and services tax (GST).

The report says “Potential GDP should continue to be bolstered by a fast-rising working age population and good labour productivity gains. We expect a sharp pick up in trend growth as the reforms carried out by the government should start to bear fruit, spurring more efficiency in the productive process”.


2016/17 export round-up

India’s exports of wood and wood products totalled US$800.49 million in fiscal 2016-17, very little changed from the previous year. Analysts point out that there is considerable scope for Indian companies to expand wood product exports.

The main export markets were the US, China, UAE, UK, Germany, Netherlands, Hong Kong, Nepal, Canada, France, Sri Lanka, Saudi Arabia, Australia, Turkey and Spain.

India is experiencing growing demand for wood products driven by the growing young and more affluent population between 18-40 years old so domestic consumption of wood products will increase.

Industry challenges Customs Department minimum price for imported teak Demand for imported teak logs remains steady, but not firm enough for wholesalers to achieve a price increase.

Difficulties with the minimum prices set by Customs continue and efforts are on-going with the Ministry of Finance to have this resolved.

Analysts write that since the GST was introduced Customs have been charging the GST based on their own minimum price for logs but, says the trade, this is not always appropriate.

For example, when an importer purchases low grade material such as thinnings or logs with a thick bark or wide sapwood the price will be lower than average but Customs is rejecting the price quoted on the import documents.

Cases have arisen where the purchase price for low grade logs was around US$290 per cubic metre but Customs applied a price of US$490 per cubic metre, their minimum price, and used this to determine the GST to be paid.

Efforts are on to resolve this problem but Customs officers are not expert on quality specifications and are reluctant to take the initiative to change. The trade has therefore to seek redress from Ministry of Finance.


Cushman & Wakefield report—housing starts declined in 2017

The combined impact of the India Real Estate Development Act and the introduction of the national goods and services tax (GST) resulted in a sharp dip in investment in residential housing in 2017 according to a recent report from property consultancy Cushman & Wakefield. The report says only the affordable housing sector recorded a year-on-year growth (+six percent).




Real Estate Development January-November 2017

Investment in Chinese real estate in the first eleven months of 2017 increased 7.5 percent year-on-year but the pace of growth slowed. Investment in residential buildings expanded almost 10 percent over the same period.

In the first eleven months of 2016, the land area purchased by the real estate development enterprises was up by 16 percent year-on-year and the pace of expansion grew.

Last year property sales slowed because of measure introduced by the government to cool an over-heated market.

The unexpected effect of the government action has been to concentrate real estate development in the hands of the major companies at the expense of smaller enterprises say analysts. 

This has occurred as the larger companies have better access to credit from banks, better access to land via regional governments and because they successfully weathered the housing market down turn in 2016.

According to China Index Academy, an independent property research organisation, the market share of the top 10 developers in Beijing grew from 35 percent to 49 percent between 2016 and 2017 a trend that has been observed in other major cities across China.


End to volume checks on imported timber

China’s General Administration for Quality Supervision, Inspection and Quarantine has announced that the requirement for checking the volume of imported timber has been terminated. 

This, say analysts, was decided in order to facilitate faster clearance for the ports and could lead to lower transit costs for importers.


Closure of timber enterprises in Taicang city

It has been reported that a zero tolerance measure has been taken on pollution from wood processing factories in Taicang City. This is part of the action on environmental pollution controls in Jiangsu province. 

An official notice was posted declaring that all wood processing factories in Taicang City must immediately cease production. All wood processing companies are required to relocate before 20 January this year.


Firm demand for custom home furnishings

It has been reported that due to the growing environmental awareness amongst consumers, demand for ‘green’ custom made home and household goods is rising.

The products in demand include wooden doors, cabinets, dinning furniture, and wood panels and furniture and makers of custom made items report that they are able to secure a price premium for custom made items.


Rise in log imports through Xiamen

According to the Xiamen Entry-Exit Inspection and Quarantine Bureau, log imports through Xiamen Port totaled 1.905 million cubic metres valued at US$46 million in 2017, up 10 percent in volume and 11 percent in value compared to 2016.

The imported logs were from 37 countries with New Zealand, Australia, the US and Estonia topping the list in terms of volumes. Imports from New Zealand totalled 962,000 cubic metres valued at US$130 million and accounted for over 50 percent of the total volume and total value of imports through Xiamen Port. The volume and value of imported logs from Estonia rose 103 percent and 138 percent respectively in 2017. 

According to the statistics, imported goods from Estonia through Xiamen port were valued at US$9.42 million of which 98 percent were logs.

The species of imported logs through Xiamen port are radiata pine, spruce, scots pine, ponderosa pine and loblolly pine but over 70 percent of the logs imported were radiata pine.


Wood products trade in Guangdong province


According to Guangdong Entry-Exit Inspection and Quarantine Bureau, between January and November 2017 log imports into Guangdong Province rose 11 percent to 34.67 million cubic metres. Sawnwood imports were 8.51 million cubic metres, up 21 percent over the same period in 2016.

On the other hand, MDF imports dropped 13 percent to 72,500 cubic metres. Particleboard imports in Guangdong Province amounted to 194,700 cubic metres, a year-on-year increase of 41 percent, accounting for 21 percent of the national total. 

Many furniture manufacturers in Guangdong province imported high quality particleboard to produce furniture.

Plywood imports into Guangdong Province fell 14 percent to 65, 800 cubic meters, accounting for 38 percent of the national total.

The value of Guangdong wooden furniture imports surged 95 percent to US$166 million between January and November reflecting increased disposable incomes and rising living standards of residents in the province.



Plywood exports from manufacturers in Guangdong Province fell in the first 11 months of 2017 with the largest drop seen in exports to the US, the largest market for Guangdong-based companies.

Plywood exports from Guangdong to the US, South Korea, the UK, and Saudi Arabia fell 15 percent, 21 percent, 12 percent and 26 percent respectively. However, plywood exports to Japan rose six percent and trade with Hong Kong rose to 172,200 cubic metres, representing a large part of exports from Guangdong.

MDF exports from makers in Guangdong Province rose 11 percent to 119,600 cubic metres in the first 11 months of last year. MDF exports to traditional markets such as to the US, Canada, South Korea and Iran fell.

In the case of particleboard, exporters in Guangdong Province are tapping new markets such as Nigeria (180,000 cubic metres), Vietnam (147,100 cubic metres), India (49,500 cubic metres) and United Arab Emirates (130,000 cubic metres).




Second longest post war economic expansion

In a survey conducted towards the end of 2017 most large Japanese companies indicated that they expect the Japanese economy to expand further in 2018 on the back of increased capital investment a recovery in individual consumption and faster export growth.

As the new year begins the government has been heartened by data showing the Japanese economy is in its second longest post war economic expansion with indications that the good news will continue into 2019 provided international demand remains robust.

Japan’s GDP has grown for seven straight quarters and the stock market is at a 25 year high but, despite good corporate profits, consumer spending remains weak as wage increase have not flowed from major companies.

The Spring wage negotiations are about to begin and already the government is lobbying hard to get the major companies to release some of their profit stock pile as wage hikes.


Traders alert for any hint of a change in the BoJ weak yen policy

Over the extended year-end holidays the US dollar/yen exchange rate barely changed as there were no significant movements in the main economic indicators.

Housing starts in Japan continue to be firm as they are in the US and there has been no movement in Japan’s manufacturing output or consumer spending which could have triggered an exchange rate movement.

Looking further ahead there does seem to be an expectation that the Bank of Japan (BoJ) will be considering an interest rate increase during 2018 given five successive quarters of economic expansion and a very tight labour market.

The weak yen is the biggest boost to exports and adds some inflationary pressure because imports are that much more expensive. A stronger yen would have the opposite effect on export growth and inflation. 

Several analysts are cautioning that currency traders remain alert to any hint of a change in the BoJ policy and that we may see a period of volatility in the yen/dollar exchange rate in 2018.


Second half robust housing market continues

Data from Japan’s Ministry of Land, Infrastructure, Transport and Tourism shows that November 2017 housing starts, while flat month on month, rose around two percent year on year. 

On the basis of the past 11 months 2017 annual starts are likely to come in at around 960,000.

Construction companies continue to report firm order book positions and Ministry data shows orders received by the top builders rose sharply in November, adding to the rise reported for October orders.


Japan’s wooden furniture imports

The cyclical trend in bedroom furniture imports has once again been repeated in 2017. After peaking in the Spring Japan’s imports of wooden bedroom furniture traditionally drop back in the months to year end only to pick up once again.

While the trend in bedroom furniture imports is following a familiar pattern this is not the case with wooded kitchen furniture. After moving within a narrow range for the past 2-3 years in the second half of 2017 imports of wooden kitchen furniture have surged. 

This could be partly the result of the flood of cash into buy-to-rent properties in Japan, a tactic used to minimise inheritance taxes by the wealthy.


Office furniture imports

Japan’s imports of wooden office furniture are small compared to the value of wooden bedroom and kitchen furniture imports.

Year-on-year, the value of October imports of wooden office furniture was up 10 percent and compared to a month earlier imports in October rose six percent. 

For the first 10 months of 2017, wooden office furniture imports were around six percent higher than over the same period in 2016.

Shippers in China accounted for over 60 percent of Japan’s wooden office furniture and along with shipments from Italy and Taiwan some 80 percent of all shipments were accounted for.


Kitchen furniture imports

The value of Japan’s imports of wooden kitchen furniture has been steadily rising since July and October marked another high. However, despite the second half surge in imports, the total value in the first 10 months of 2017 was little different from that during the same period in 2016.

Closer examination of the import flow shows that in the first half of 2017 imports were below average.

Year-on-year October 2017 imports were up 37 percent and month on month there was a 12 percent rise in October 2017 from a month earlier. The combined shipments from the Philippines, Vietnam and China once again account for over 90 percent of all September shipments of wooden kitchen furniture.


Bedroom furniture imports

Japan’s imports of wooden bedroom furniture continue the familiar trend seen in past years of a steady decline in the second half of the year with an expected up-tick in the later months of the year and the early months of the new year.

October 2017 imports of wooden bedroom furniture were up around three percent on levels in October the previous year and month on month there was very little change which may signal the traditional reversal of the decline in the second half of each year.  

However, total imports over the 10 months to October 2017 are down slightly when compared to the same period in 2016.

Shippers in China and Vietnam dominate Japan’s imports of wooden bedroom furniture accounting for 59 percent and 29 percent respectively. If shipments from Thailand and Malaysia are included then some 95 percent of all wooden bedroom furniture is accounted for.




EU wood furniture surplus narrows as imports rise

The EU has maintained a trade surplus in wood furniture since 2011 when exports to non-EU countries overtook imports from outside the EU. 

This surplus remained broadly flat between the start of 2015 and the first quarter of 2016 (averaging close to €3 billion per annum), as both imports and exports were stable.

However, the trade surplus narrowed sharply in the second and third quarters of 2017 (to around €2.6 billion perannum) as imports began to pick up.

The narrowing of the EU trade surplus is an encouraging sign for external suppliers of wood furniture into the EU that have struggled to compete in a market where domestic suppliers account for around 85 percent of total share.

The dominance of EU manufacturers in this sector is due to various factors including the strength of domestic brands in terms of innovation and design, the obstacles to overseas suppliers complying with complex EU technical and environmental standard, and the expansion of furniture manufacturing in Eastern Europe, a location which combines ready access to raw materials, relatively cheap labour, and the internal EU market.

Improved economic conditions in pe have been driving arise in wood furniture consumption in the last three years. Rising consumption combined with the growth of manufacturing in Easternpe, particularly in Poland, Romania and Lithuania, is reflected in a rapid rise in EU internal wood furniture trade, from an annual level of €15 billion at the start of 2014 to nearly €19 billion by the end of 2017.

The pace of the rise in internal EU wood furniture trade tailed off a little during 2017. However, last year there was a rise in the pace of EU wood furniture imports from outside the region. 

Between January and September 2017, the EU imported €1.39 billion of wood furniture from tropical countries, nearly nine percent more than the same period the previous year. 

EU imports from China also increased, by four percent to €2.38 billion in the same period. However, the biggest gains in EU imports of wood furniture in 2017 were from other temperate countries, notably Bosnia, US, and Ukraine. 

EU imports from these countries increased 28 percent to €1.01 billion in the first nine months of 2017, building on a 14 percent gain recorded the previous year.

In the first nine months of 2017, EU imports increased from all four leading tropical supply countries; rising by three percent from Vietnam to €567 million, four percent from Indonesia to €246 million, 11 percent from Malaysia to €154 million and 16 percent from India to €154 million.

There was also a significant rise in EU imports from Hong Kong, Singapore and the UAE during the same period. In contrast, imports from Brazil fell eight percent to €85 million and imports from Thailand declined six percent to €45 million.

The increase in EU imports of wood furniture in the first nine months of 2017 was concentrated in the UK (rising nine percent to €546 million), Germany (rising four percent to €185million), Netherlands (rising 21 percent to €142 million) and Spain (rising 31 percent to €57 million).

Although the quantities are still quite limited, several smaller EU markets also recorded significant percentage increases in wood furniture imports from tropical countries in 2017 including Sweden, Denmark, Poland, Ireland and Greece.


Global furniture production dominated by China

Total furniture production in the world’s 100 largest countries, by GDP, was valued at USUS $430 billion in2017. 

This is a key conclusion of ‘World Furniture Outlook 2018’, the flagship publication of CSIL, the Italian furniture research organisation.

The report includes details of the furniture sector in 100 countries which account for 90 percent of world population and 95 percent of world GDP. The report considers furniture in all materials but excluding lamps and mattresses.

The CSIL report highlights the extent of China’s dominance as the world’s largest furniture manufacturer.

Last year, China alone accounted for nearly 40 percent of global production. The US, the second largest producer, accounted for 12 percent, followed some way behind by Germany (five percent),Italy (four percent), India (four percent), Poland (three percent), Japan (two percent), Vietnam(two percent), UK (two percent) and Canada (two percent).

The CSIL report shows that international trade in furniture was USUS$140 billion in 2017, corresponding to around one percent of total global trade in manufactured goods. 

After a sharp rise in the value of global furniture trade in the decade prior to 2012, trade has remained broadly flat in the past five years.

Furniture exports in China, the largest exporter, were around US$51 billion in 2017, a slight gain on the previous year but lower than in 2015.

Exports in Germany and Italy, the next largest, were both valued at around US$11 billion in 2017, a level that has hardly changed in the last eight years. However, exports have been rising in Poland and Vietnam, reaching around US$10 billion and US$8 billion respectively in 2017.

The US is the world’s largest furniture importer, with imports of around US$34 billion in 2017 having risen continuously from only around US$24 billion in 2010. The value of imports in the next largest importing countries—Germany (around US$13 billion in 2017), the UK (US$7 billion), France (US$7 billion) and Canada (US$6 billion)—were broadly flat during the same seven-year period.

CSIL forecast that global consumption of furniture will rise by 3.5 percent in real terms in 2018. The fastest growing region continues to be Asia, with all other regions growing between one percent and three percent in real terms.

While China’s furniture production continues to rise rapidly, export growth is more subdued according to CSIL.

Drawing on commentary from Chinese manufacturers, CSIL reckons that Chinese furniture export growth is unlikely ever to return to levels seen earlier this decade for several reasons including: rising labour rates in China; the progressive appreciation of the RMB against the US dollar between 2003 and 2016; rising competition particularly from Vietnam; and the rapid growth in China’s internal demand.

Currently, around 30 percent of China’s furniture production is exported, but this proportion is gradually declining as more product is sold into the domestic market.


Growth in hospitality sector creates new opportunities

According to recent CSIL research carried out with focus on 16 Western pean countries, the total value of the pean market for contract furniture and furnishings in 2016 was €7.5 billion while total production was nine billion.

The sector was expanding in 2016 with yachting, luxury retail, and the hospitality sectors (hotels, bars and restaurants) being the fastest growing segments while sectors dependent on public funds, such as schools and hospitals, were much less dynamic.

CSIL has also carried out detailed research on the global development of hotel rooms, a sector significant for tropical hardwoods due the relatively large amount of higher end furniture and finishing materials used. 

CSIL estimates that in 2016 the total global stock of hotel rooms was 16 million with most recent growth in the Asia-Pacific region.

Between 2012 and 2016, the share of hotel room in the Asia Pacific region increased from 22 percent to 26 percent, while the share declined in pe from 30 percent to 28 percent and in North America from 41 percent to 38 percent. The share of hotel rooms in Africa, the Middle East, and South and Central America remained stable with values ranging between three percent and five percent.

CSIL estimates that 650,000 hotel rooms were under construction globally in 2016, of which 40 percent were in Asia-Pacific, while North America accounted for 29 percent and Europe only 10 percent. 

However, demand for new hotel rooms is expected to remain high in all regions with the glow flow of tourists forecast to increase three percent per year on average until 2030.

While Asia-Pacific has seen the most recent growth, the US continues to be the leading world market for hotel furniture and furnishings, accounting for 36 percent of total global demand in 2016. 

The Asia-Pacific region is now the second largest market, accounting for 28 percent in 2016, overtaking Europe which accounted for 26 percent, followed by Africa and the Middle East (seven percent), and Central and South America (three percent).

Total sales of hotel furniture and furnishings were at a similar level in the United States and China in 2016, in the region of US$5 billion in each country.

Other large markets with demand between US$1 billion and US$5 billion are Germany, the UK, Japan, Canada and Russia. Countries currently with smaller markets, but where demand is rising rapidly include Australia, UAE, Thailand, Indonesia, Singapore, and the Philippines.

CSIL estimates that the rate of worldwide construction of hotel rooms is likely to have increased nearly 10 percent in 2017 to 710,000, with Asia-Pacific accounting for 37 percent of the total, North America for 33 percent, the Middle East for 12 percent, Europe for 10 percent, Africa for five percent and South America for four percent. 

CSIL expects that this rapid rate of growth will continue in 2018.

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