Gdansk plans €1.4bn of investment prior to Euro 2012

Russian construction still growing rapidly

Largest shopping mall in SEE opens in New Belgrade

EU to delay launch of membership talks with Macedonia

Brazil to host 2014 World Cup

US interest rates cut to 4.5%

New airport opens in Cape Verde

Foreign direct investment in Indonesia leaps 123% Jan-Aug

Gdansk plans €1.4bn of investment prior to Euro 2012

Gdansk ’s local authorities have published a list of priority investments connected with the organisation of the Euro 2012 matches to be hosted in the city. According to estimates, these investments will absorb 70-75% of the Long-Term Investment Plan for 2008-2012, which boasts a total budget of more than Zloty 5.2bn (€1.4bn).

The most pressing concerns detailed in the list are the construction of the Baltic Arena stadium, the reconstruction of the airport and its approach roads as well as investments in the city’s tourist base. The city’s local authorities calculate that the stadium will require outlays of around Zloty 660m (€182.3m), while expansion of Lechia football club’s existing stadium, which will serve as a training base for Euro 2012 participants, will set the authorities back another PLN 30.9m (€8.5m).

Work is due to get underway on the new stadium in 2008 and take two years to complete. The stadium together with auxilliary structures will stand on a 40 ha plot in the city’s Letnica district, which is currently the site of garden allotments. The investment will also include revitalising the district itself.

Russian construction still growing rapidly

The value of construction works in Russia has increased significantly over the past four years, averaging 12.3% annual growth. However, this year the sector has been expanding at twice that rate.

The construction industry currently accounts for some 5.6% of Russian GDP and it is still growing, up from 4.7% in 2006, when the total value of construction works increased by 15.7% to €66bn.

Traditionally, most works are concentrated in several Russian regions. The city and suburbs of Moscow, and the city of St. Petersburg account for nearly 30% of the country’s total construction output while Russia’s ten best performing regions contribute over a half of the total figure. But Russia’s other smaller cities are now expected to see a significant increase in construction also.

Around 95% of the total number of commissioned buildings and almost 90% of total completed space were solely for residential accommodation , aided by the national housing programme and spurred on by great demand among Russia’s population. In fact, last year the housing construction index doubled its 2001-2005 average value. This growth has stepped up again in 2007 – in the first half of this year the number of homes completed surged by nearly 25% and their total floor space grew by almost 35%.

However, the Russian authorities have finally announced their intentions to begin coping with the country’s biggest problem, an underdeveloped road network. Major boosts are also expected in energy infrastructure development and railway construction.

Shopping malls and offices are also popping up across the country as are logistics centres. The development of the latter, though, has been hindered by the above mentioned poor road network. Nonetheless, according to estimates, Moscow and its vicinity continues to account for about 50-60% of the commercial property market in Russia and some 20-25% lies in St. Petersburg; other regional centres across Russia make up the remainder.

Largest shopping mall in SEE opens in New Belgrade

The biggest shopping mall in South East Europe (SEE) and the first international-style shopping mall in the whole of Serbia opened in New Belgrade in early November.

Delta City features world-class facilities and boasts big-name anchors, including Zara, and Marks & Spencer. The mall also features a supermarket, a Cineplex and a bowling alley.

The exclusive leasing agent for the mall was Colliers International Serbia. In total there are more than 120 tenants, including the likes of Mango, Morgan, Mothercare and Costa Coffee.

Delta City has a very large catchment area as New Belgrade is the largest residential area in Belgrade with a very high population density. It will have high visibility from one of the main traffic arteries of New Belgrade and the total size of the development is 87,000sqm.

Delta is undertaking work on another mall in Belgrade called Delta Planet, that will be a regional shopping venue, and the first mall in Montenegro, Delta City Montenegro in Podgorica, which is due for opening in spring 2008.

The president of Delta, Miroslav Miskovic, speaking at the opening, confirmed that Delta’s plans include building shopping malls in Nis, Novi Sad, Podgorica and Banja Luka. In the following years, Delta will start opening shopping malls across the entire region of Southeastern Europe – in Bucharest, Sofia, Zagreb, Skopje and Tirana.

Philip Bay , regional director of Colliers International Southeast Europe, concluded, “I am delighted that we achieved 100% leasing well before the opening.”

EU to delay launch of membership talks with Macedonia

The EU will not give the Former Yugoslav Republic of Macedonia the green light for starting accession talks as the Balkan country had hoped, with the European Commission citing political shortcomings for the delay.

According to a recent annual commission evaluation report, the parliament and the administration are not functioning well enough, and important reforms are still not completed.

“The firing of civil servants after the change of the government in 2006 illustrates how much all the levels of the administration are politicised, which impedes its proper functioning. A difference has to exist between the political and the administrative level”, the commission’s draft report stated.

The report also says that problems typical of countries in the Balkan region – such as lagging reforms of the judiciary system and corruption problems – have still not been tackled.

According to the commission report, corruption remains ‘widespread’.

To make matters worse, Greece has been refusing to recognise the country under its constitutional name – Republic of Macedonia - ever since it declared independence in 1991 following the split of Yugoslavia.

A Greek northern region is also called Macedonia and Athens fears potential territory claims if the Macedonian government in Skopje, the capital of Macedonia, is allowed to use it.

Instead, the name of Former Yugoslav Republic of Macedonia (FYROM) has been used by the international community as a ‘provisional’ term designating the country since 1993 - with Athens and Skopje disagreeing on the long-term use of this term.

Realistically, of the remaining Balkan countries, only Croatia, which opened membership talks in October 2005 and is currently the most advanced Western Balkan country, could join the 27-member EU in the next five years.

Shortcomings are also noted in the Croatian report, however, including the treatment of Serbian minorities and the alignment of national tax legislation with EU norms.

However, US Permanent Representative to NATO, Ambassador Victoria Nuland, called on Macedonia to continue reforms that will secure an invitation to NATO membership in April 2008.

Brazil to host 2014 World Cup

Brazil faced no competition from its South American neighbours and was in fact the only country that was bidding to host the 2014 football World Cup tournament , which needs to be staged in the continent under Fifa's current rotation system.

Brazilian president Luiz Inacio Lula da Silva said: “Soccer is more than a sport for us, it’s a national passion.”

Brazil have won the tournament a record five times but have only hosted the World Cup once before, in 1950, when they lost 2-1 in the final to Uruguay. It is the first time the World Cup is being held in South America since Argentina hosted, and won, the 1978 tournament.

Brazil is setting aside around £550m to update its stadiums, including the Maracanã in Rio de Janeiro which hosted the 1950 World Cup final. The other host cities have not been decided yet and Fifa’s inspection report has identified 18 possible grounds that have a capacity of over 40,000 and from this list, a further nine cities will be selected to host games.

However, of the 18, four would have to be completely re-built and all of the others need to undergo substantial renovation.

US interest rates cut to 4.5%

The Federal Reserve has decided to cut US interest rates by a quarter-percentage point to help boost its economy and slow the housing downturn. However, the Fed has hinted that further interest rate reductions in the near future are far from a sure thing.

The decision by the central bank’s Federal Open Market Committee to lower the overnight federal funds rate to 4.5% - a move that followed a more aggressive half-point cut last month - was widely expected. But the Fed offered a bit of a surprise by saying the risk of inflation was about equal with the downside risks to growth.

That statement, coupled with a dissent from Kansas City Federal Reserve Bank President Thomas Hoenig, who favoured holding rates steady, threw cold water on expectations that additional reductions in borrowing costs are in store.

US interest-rate futures contracts implied only a 42% chance that the Fed will lower rates again at its next meeting in December.

New airport opens in Cape Verde

Property investors in Cape Verde will be pleased to hear that the new airport has opened on the island of Boa Vista.

Boa Vista International Airport was opened by Prime Minister José Maria Neves as part of the Government’s strategic programme to enhance the local infrastructure and improve accessibility for the tourist industry.

Some developers are now inviting potential investors on a series of inspection trips. Assets is reported to be offering trips to the Palm View Resort in Boa Vista and two-bed apartments start at €170,000.

Foreign direct investment in Indonesia leaps 123% Jan-Aug

The value of foreign direct investment (FDI) in Indonesia skyrocketed 123% year-on-year to reach $11.7bn in the first eight months of this year.

Implementation of foreign investment projects surged 107% to $8.13bn and domestic investment jumped 172% to $3.57bn, said chief of the investment board, Muhammad Lutfi.

Realization of investment was mainly in the transport, warehousing and telecommunications sectors, together representing 30 projects and accounting for $3.28bn of the total.