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Importance of being chemical

Posted 06/11/2013 by sevans

At the annual meeting of the European Petrochemical Association (EPCA) in Berlin, held in early October, Mohamed Al-Mady, vice chairman and ceo of Saudi Basic Industries Corporation, better known as Sabic, called on the European chemical industry and various governments to focus on more resource and cost efficient manufacturing, target incentives for innovation at the development stage and institute a robust regulatory framework based on good science with clear goals. ‘Europe faces a new reality…..Governments must proactively support this transition – it cannot be done by industry alone.’

Certainly the UK chemical industry believes that government has a role to play in its future development, but the signals from various UK governments have been mixed over the years. It did work with the industry over the REACH legislation but elsewhere support has been mixed and focused on the high tech end of anything chemically related. But as many political observers have commented, and even former prime ministers have pointed out, many interventions are driven by ‘events’.

Perhaps the UK government didn’t expect it would be thrust into the arena quite so dramatically when the Ineos Grangemouth dispute blew up spectacularly only days later, especially as it was about to meet with industry representatives to discuss proposals about delivering chemistry-fuelled growth for the UK economy. The Grangemouth dispute quickly flew up the political agenda with the referendum on Scottish independence as a major driving factor.

Thankfully the Ineos situation was resolved relatively swiftly by a total retreat by the main trades union concerned, which appeared not to believe what Ineos’ hard headed boss Jim Radcliffe was saying, despite his previous track record. But the problems for the chemical industry in the UK are unlikely to go away so quickly, and government involvement is essential to maintain its manufacturing record.

Successive governments appear at best to have taken the sector’s performance as the leading UK exporter as a given, or at worst, believed that chemicals represent a sunset industry, best left to fade away. And as C&I has pointed out, those with long enough memories will remember that we have been down this path before with the Innovation & Growth Teams of the early 2000s.

Now the UK’s chemical and chemistry-related industries have developed a joint approach as the Chemistry Growth Partnership (CGP) to present a comprehensive strategy with a vision of 50% growth by 2030. It was just extremely unfortunate that the launch of this strategy coincided with the high-profile discussions around the future of Scotland’s major industrial site, particularly as the Chemical Industries Association had drawn up a specific Scottish strategy within the overall plans.

The CGP has identified a number of key challenges including energy security, innovation and the re-building of UK supply chains; the latter being something highlighted by SCI president, Paul Booth, who also happens to be Sabic’s UK chairman, when he revealed some of the CGP’s thinking earlier at the SCI AGM (C&I, 2013, 8, 4).

It was particularly unfortunate that the first meeting of the CGP with the UK business secretary Vince Cable and business minister Michael Fallon was overshadowed by the Ineos negotiations because the general media was too tied up in one chemical story to actually cover a second, especially one that is essentially about good news.

One thing this unfortunate timing may bring about, however, is a greater appreciation and understanding by the general public, and also hopefully politicians of all persuasions, about the major role the chemical industry plays in the UK economy. Sabic’s ceo has it right; only through a partnership between industry and government is the chemical sector going to survive the current and up-coming challenges that include shale gas, recruitment, innovation and productive manufacturing.

Neil Eisberg - Editor

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