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Chemical Trade Groups Comment on US Vote

11.11.2016 -

Chemical industry trade organizations both in the US and Europe reacted to the outcome of the Nov. 8 US general election with statements offering the usual pledges to work with a new national administration, while in a not always subtle manner that in some ways seemed to echo the tone of this year’s election campaigns striving to get their own message across.

The statement from the European Chemistry Council, CEFIC seemed to mirror the second recent shock of an unexpected outcome – having to work with an unknown factor, a President Donald Trump rather than a President Hillary Clinton. Still reeling from the UK’s June 2016 vote to leave the European Union, CEFIC said: “Today we have again woken up in a world that will be different to what most people expected. We have a new US President and, which is important, a Republican majority in both the US house and Senate.

“Following the Brexit experience,” CEFIC continued, “it’s far from clear to say today what the impact of this will be. As we saw after Brexit, volatility on markets and uncertainty will prevail in the short term, but the longer term impact has yet to be determined. This uncertainty is the key issue. What we do know is that both climate policy and international trade will operate in a very different environment.”

To reduce the uncertainty, the chemical producers said EU leaders “need to develop a relationship with the new US president as soon as possible and ensure that the partnership we have had, in terms of democracy, security and the economy, continues.” As the US and European chemical industry are closely linked, intensive trade partners, CEFIC said “Europe’s views on energy, climate, chemical and trade policy should be rebalanced in this new world. Industry likewise will have to adapt, and will do so.”

According to CEFIC figures, the US contributed almost 22% of total EU chemical trade in 2015. The country is by far the EU’s biggest trading partner for chemicals, in 2015 accounting for €31.3 billion in exports and €23.1 billion in imports.

A separate statement, the German chemical industry association Verband der Chemischen Industrie, VCI – which represents the EU industry’s biggest chemicals economy – also hinted at concerns about the course the US will take. Referring to “nationalistic and protectionist positions” taken during the election campaign, the association said it hopes that, as US president, Donald Trump “will build on the close political and economic ties between the European Union and the United States. We need a stable transatlantic cooperation in the major global issues of the future – for example, in trade, climate and economic policies.”

The US is by far the most important export market for the German chemical and pharmaceutical industry, taking 11.4% of all relevant German exports last year. VCI said its member companies realize annual proceeds of just under €20 billion in trade with US customers. The US also ranks “number one” in the corporate strategies of German chemical businesses, it added. These companies have around 140 subsidiaries in the US, with 71,000 staff and sales of more than €61 billion.

In its statement, the American Chamber of Commerce in Germany – which caters to all branches of business and industry – expressed hope that the new US leadership will strengthen its ties to Germany and also embrace “important projects” such as the Transatlantic Trade and Investment Partnership (TTIP), a trade agreement that meanwhile few on either continent are confident of seeing realized in the near term. Both presidential candidates, Trump and Clinton, came out against global trade agreements during the campaign.

A close partnership between Europe and the US is essential, Amcham stressed, while emphasizing that Germany is the most important trade partner for American companies as well as being an important place to invest, while the same is true in the other direction.

Closer to home for the new president and Congress, US-based chemical industry organizations also delivered cooperation pledges while paying tribute to their own home-grown interests. The Society of Chemical Manufacturers and Affiliates (SOCMA) pledged to work with the new Congress and president to “ensure they understand the issues crucial to the success and competitiveness of our members and the specialty chemical industry.”

In order to succeed, chemical companies “need business certainty and relief from regulatory burdens that hinder growth,” SOCMA said, underscoring that its members will work with the new Administration to “ensure that their voice is being heard, and advocate for laws and regulations that are based on sound science, while creating a safe environment not only for our workers but the communities in which they reside.”

SOCMA also stressed the importance of “open and fair trade” that levels the playing field, particularly for small and medium-sized manufacturers who compete globally, as well as the need to address “barriers that impede the ability of US specialty chemical manufacturers from growing their businesses.”

The American Chemistry Council (ACC) went straight to the point, saying the election result was “a clear call by the American people demanding the kind of change that will produce results in Washington and economic growth across the country. Chemical producers will be a partner with leaders in Congress and the Trump/Pence administration to ensure the right policies are in place to support robust and responsible energy and infrastructure development that will keep our industry and our economy on a path to strong growth,” the ACC statement said.

In its remarks, ACC also praised the Republican party leaders in Congress, saying, “they have demonstrated that they understand the contributions of the chemical industry to the economy, to creating jobs and to developing materials and innovations that “revolutionize our society and provide solutions to pressing challenges facing our nation and our planet.”

The producers’ grouping said it looks forward to working with the new administration as it implements the recently passed Lautenberg Chemical Safety Act – formerly known as the Toxic Substances Control Act – so that the Environmental Protection Agency (EPA) “proceeds in a way that will promote safety and innovation.” During the campaign, Donald Trump had suggested he might consider defanging the environmental watchdog