CEFIC Urges Strong EU Industrial Policy

02.03.2021 - Following a decline of 2% in 2020, European chemical production is forecast to pick up by 3% in 2021, before growth rates taper off slightly in 2022, but output in that year should still land 2% higher against 2021.

In a preliminary look at industry figures for 2020, the European chemical industry council CEFIC said that while these “green shoots” prove that the chemical value chains are among the most resilient in Europe, the longer-term economic outlook “remains highly uncertain,” due to the ongoing Covid-19 pandemic and its knock-on effects.

The entire EU manufacturing sector has been hit hard by the pandemic, said the industry association’s director general, Marco Mensink. This led to a decrease in overall manufacturing output, including chemicals, of 8% last year – even if the burden was eased somewhat by increased demand for chemicals used to produce public health supplies.

Overall capacity of the chemical industry in the EU 27 dropped by about 6% year-on-year in 2020, and sales were €34.8 billion below the January to November 2019 level. Exports decreased by €7.4 billion (4.5%) in the same period, figures show.

Supported by the multi-billion European Recovery Plan package, the EU’s industry can move forward fast, the CEFIC chief executive said. But chemical producers will need the right framework conditions to remain competitive during the transition to a greener economy. This is especially important, Mensink said, if the industry is to stem the “massive investment” the Green Deal will require.

In the transition, CEFIC urged that “Europe must show its leadership in innovating and deploying competitive new technologies for delivering a climate neutral, circular and digital transition, whether it is chemistry for solar panels, wind turbines, batteries, building insulation, medicines or chemical recycling technologies.” To do this, it will need a workable industrial policy that will ensure sustainable economic growth and new jobs.

To secure the required investment and maintain the European chemical sector’s export success story, Mensink said CEFIC expects the Commission’s new industrial policy strategy to provide the markets and conditions for industry to become more sustainable, more competitive globally and more resilient.

Author: Dede Williams, Freelance Journalist