European debt crisis continues to urge local chemical companies to be optimistic about the Chinese market

The debt crisis in Europe has not seen any significant improvement. Chemicals, the main raw material for manufacturing, have also been weighed down. The European Chemical Industry Association (CEFIC) recently estimated that chemical production in Europe will stop growing this year. The association previously predicted that Europe’s chemical production this year will increase by 1.5%. In 2011, chemical production in Europe increased by 1.3%.

Hubert Mandeli, president of the European Chemical Industry Association, pointed out recently that the demand for chemicals in Europe this year has fallen slightly compared to 2011, as the overall business climate in the EU continues to be weak, and EU member states are implementing austerity fiscal policy. This led to a reduction in corporate orders, while also keeping the company's inventory at a lower level.

Based on this, CEFIC made the forecast that European chemical production will stop growing this year, but it is not negative growth.

It is worth noting that this expectation is based on the more optimistic assumption made by CEFIC. In arriving at this conclusion, CEFIC assumed that the debt problems of European governments and the weak performance of banks will not spread in EU member states; it also assumes that the major export markets of the two European companies, the United States and China, will still have a Strong growth.

At the end of the first quarter of this year, heads of chemical companies in Europe and the United States had expected chemical demand to turn stronger in the second half of this year, but at least until now, signs of improvement have not yet appeared. Kevin Swift, chief economist of the American Chemical Industry Council (ACC), said that the recent economic indicators in the United States are mixed; commercial inventories have increased, but the overall industrial output in May has decreased. This is also the past three The second drop in the month.

“The retail sales target is also very disappointing. This shows that the slow economic recovery, but also shows that the current consumer is generally afraid of losing their jobs, they also have no confidence in the return of the stock market, but also worried about the emergence of a new round of credit crisis.” Wift added.

High-ranking CEFIC Hubert Mandley and Swift both believe that if countries’ economic policies can be beneficial to boost business confidence, manufacturing will increase. In addition, they also expect central banks to take further stimulus measures.

Although the economic situation in Europe is still a fog, and the Chinese economy has also shown signs of slowing down, European chemical giants have not lost confidence in the Chinese market.

Recently, the world's largest paint company Akzo Nobel Global President Don Bonaparte made his first visit to China just after his new arrival, which fully demonstrated the importance attached to the Chinese market.

“We do feel the signs of a slowing economy, because the economic slowdown will first of all be reflected in the residential market, and paint companies will soon feel as a supplier of residential properties, including special chemicals and coatings have a slowing trend. In fact, except for China, there are similar situations in other BRIC countries,” said Don Bonner in an exclusive interview with this reporter.

However, he said, he said that he firmly believes that the Chinese market will resume growth again. “From the sales point of view, China is already our second largest market in the world. The company’s investment in China has exceeded 1 billion Euros. China’s There is no doubt about the importance, we will also pay special attention to the Chinese market, and the decision to continue investment in the country will not change."

When talking about how to deal with the economic downturn, he pointed out that we must bring products closer to customers, cultivate high-quality local teams, and continue to provide high-quality products.

Another learned from the opening ceremony of BASF's Little Chemists held last week that BASF, the global leader in the chemical industry, has exceeded 6.5 billion euros in sales in Greater China last year, and has attracted much attention from Chongqing's MDI (biphenyl). The methane diisocyanate project is progressing well. This also dispelled some of the rumors and doubts of the previous workshop.

The MDI project, which is hailed as the largest in the world but has also triggered public opinion disputes, will mainly produce core raw materials for polyurethane foam and is scheduled to start operations in 2014.

At the same time, BASF is still upgrading its wastewater treatment facilities and further expanding its production scale. In addition, the second phase of its expansion project of the Nanjing-based joint venture company, Yamba, was officially completed a few days ago. Together with the integration of Yangzi Petrochemical-BASF Styrene last year, Yamba's cumulative investment has reached US$4.5 billion.

Another Bayer MaterialScience company, a German chemical giant Bayer, also plans to shift its new investment focus to China. Bayer Group President Marijn Dekkers recently stated that the average energy costs of Bayer MaterialScience's subsidiaries around the world have reached 6% of the turnover and higher in Germany. For such energy-intensive chemical companies, Germany is no longer attractive. In order to maintain its competitive advantage, companies must shift production to countries with lower energy costs. China is a good choice.

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