The European chemical industry is caught in internal and external difficulties

The European chemical industry is caught in internal and external difficulties.

On the one hand, the continued downturn in the European economy has led to sluggish demand in various countries; on the other hand, there is a huge gap in petrochemical production costs between Europe, the Middle East, and North America; at the same time, strict regulations in Europe have led to increased production costs and affected export competitiveness. The share of European chemical products in the global market has dropped significantly.

Under the grim situation, European industry experts reached a consensus: the European chemical industry must realize "self-salvation".

Only 17% of the global market

Hubert Mandry, Director General of the European Chemical Industry Council (CEFIC), said: "CEFIC has adjusted its forecast for 2014, adjusting the output of European chemicals from the 2% increase predicted in June to the current growth. 1.5%. But based on the rest of this year and the forecast that the economic growth rate will stabilize in 2015, our forecast for chemical production in 2015 will not change, and European chemical production will increase by 1.5% in 2015. However, some of the current main indicators Indicates that the risk of a deceleration in growth is rising.”

In the first 7 months of this year, the output of European chemicals was the same as that of the same period last year. Specifically, the output of petrochemical products decreased by 6.5% year-on-year, the output of special chemicals increased by 3.3% year-on-year, the output of consumer chemicals increased by 1.5% year-on-year, and the output of polymers increased by 1.5% year-on-year. An increase of 0.4%, and the output of basic inorganic chemicals increased by 0.2% year-on-year. However, European chemical production declined in July. In the first half of this year, net exports of European chemicals amounted to 22.5 billion euros, lower than the level of the same period last year. As of the end of July, European chemical sales revenue was only 1% higher than the peak in the same period in 2008.

Mandry said: "Europe's chemical production is still increasing, but our share of the global market is declining, and China and the United States have taken the upper hand. Last year, global chemical sales revenue reached 3.16 trillion US dollars, and Europe's share was 17%. In 2004, Europe accounted for more than 30%.”

"Unaffordable" climate policy

Clamadieu, president of CEFIC, said that maintaining competitiveness is crucial for Europe's 29,000 chemical companies and 1.2 million employees. At present, the investment in European chemical industry has decreased, and some industries are at risk. To reverse the situation, Europe should ensure the smooth implementation of relevant EU policies and measures, fully consider the current global economic situation and strive to enhance the competitiveness of European companies.

Mandry pointed out that the main reason for the sharp decline in the global market share of European chemicals is that the European Union's heavy regulation and high raw material prices have increased the production costs of European chemicals, while other regions do not have such difficulties .

Former CEFIC President Bock called on European politicians to promote the development of European industries from a global perspective, because European industries face fierce competition. "Today, the contribution of the chemical industry to European GDP is only 15%. For the healthy development of the European economy, the European Union has established the goal of 'industrial contribution to European GDP will reach 20% by 2020'. However, the reality is that the amount invested in chemical production Funding is dwindling, European technology can no longer keep pace with the rest of the world, and the chemical industry chain is at risk."

Europe needs to make energy more price-competitive and make climate policies affordable for businesses, CEFIC said. Currently, the cost of natural gas and electricity in the United States is 1/3 and 1/2 of that in the EU, respectively. If the EU wants to meet the target of industry contributing 20% ​​of GDP by 2020, then industry should not be bound by EU climate policy. The European Commission's greenhouse gas emission reduction proposal means that the European chemical industry's greenhouse gas emissions will be reduced by 70% compared with 1990, and will continue to reduce emissions in the future. This means that Europe will import more products, which is harmful to European industry. The EU Competition Commission should fight for competitively priced energy supplies for European industrial companies. Energy and climate policies must be affordable, or the region will regress in industrialization after European industry loses the competition. Only in the right framework can the European chemical industry continue to contribute to the EU's low-carbon economy. It is time for the EU to remove costly unilateral measures.

"Self-salvation" in the new situation

Mandry said that the European chemical industry must carry out a "self-salvation" every 20 to 30 years, and under the current situation of intensified competition, the process of "self-salvation" must be accelerated to maintain competitiveness. European chemical companies are transforming from energy-intensive, basic processing enterprises to high value-added and low energy-intensive enterprises.

Clamadieu said: "Enhancing the competitiveness of the energy sector is the top priority. Even if some European countries have lifted the ban on shale gas development policies, it will still take a long time for the European shale gas industry and natural gas supply business to recover. The conditions in Europe are very different from those in the United States. The shale gas industry has developed rapidly in the US with a more relaxed environment, while Europe does not have such an environment. We need to look at this issue with a pragmatic attitude. Some European countries already have shale gas potential for development, but it must be developed under the premise of good environmental protection.”

He believes that the success of the shale gas revolution in North America has dramatically changed the global energy outlook. The European petrochemical industry, which relies on oil and gas raw materials, must adapt to the new situation, such as choosing to import natural gas from North America. The European petrochemical industry should strive to change itself and enhance its competitiveness.