European chemicals production will stop growing this year
The European Chemical Industry Association (CEFIC) stated last week that due to the impact of the European debt crisis, European chemicals production will stop growing in 2012. The association had previously forecast 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 that the demand for chemicals in Europe this year has fallen slightly compared with 2011 because the overall business climate in the EU has continued to weaken, and EU member states have implemented tightening fiscal policies. The reduction of enterprise orders also kept the company's inventory at a lower level.
In fact, this lowered expectation that chemical production stopped growing this year rather than negative growth is also based on the more optimistic assumptions 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 also expected chemical demand to turn stronger in the second half of this year, but now it seems that signs of improvement have not 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. Swift further added that the retail sales target is also very disappointing. This shows that the slow economic recovery, but also shows that consumers are generally afraid of losing their jobs, they also have no confidence in the stock market return, but also worried about the emergence of a new round of credit crisis.
Analysts in the chemical industry also saw a decline in the business of many companies. Bruce Kasseman, chief economist at JPMorgan Chase Investment Bank, also recently lowered his forecast for growth in the second half of the global economy from the previous 2.6% to 2.1%.
Hubert Mandley of CEFIC and Kevin Swift of ACC believe that if countries’ economic policies are conducive to boosting business confidence, manufacturing will increase. In addition, they also expect central banks to take further stimulus measures. Bruce Kathman stated in this regard that under the current economic situation, it is unrealistic to hope that all countries can launch powerful measures.
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