Our forecasts for the construction industry in Slovakia remain robust. After real growth in the sector of6.0% in 2007, we estimate that construction expanded by 7.3% in real terms in 2008. In 2009, weanticipate only a modest slowdown in real construction sector growth, to 5.6%. This is above the likelygrowth rate for the economy as a whole in 2009.One significant factor supporting Slovakia's infrastructure outlook is capital spending by the government.Indeed, we forecast that such investment will increase to US$18.4bn in 2009, up from an estimatedUS$17.4bn in 2008. This should partly offset a slowdown in construction activity by the private sector.For the last four years of our forecast period ' from 2010-2013 ' our core scenario is that growth in realconstruction industry value will expand in a narrow range of between 4.5% and 5.7% per year. Thisrobust long-term picture partly reflects the ongoing upgrade of transport infrastructure.Risks to our outlook for construction and infrastructure activity in 2009 and 2010 are to the downside.Slovakia's economy could yet succumb in a much more pronounced fashion to the global economicdownturn, necessitating belt tightening by the government (which has been running a fiscal deficit) aswell as private sector operators. At the moment, our core scenario envisages that global economic growthwill bounce back in 2010, but a more protracted recession in developed economies is certainly possible,with attendant implications for Slovakia's government revenues and infrastructure investment.This quarter we introduce a detailed analysis of the outlook for Doprastav and Metrostav. We anticipatethat Doprastav may have to reign in some of its expansionist ambitions. Although the outlook for theSlovakian market is supportive, Hungary (a relatively new market for the company) is beset bydifficulties at present, with the government going cap in hand to the IMF.