However, the scenario is changing with the global financial crisis. The impact of the crisis on the petrochemicals industry will be the focus at a forthcoming forum in Dubai.
The global financial crisis will be a key topic for discussion as industry leaders gather at the third annual GPCA Forum, which is organised by the GPCA in Dubai.
Attendees at the Middle East’s largest petrochemicals conference will have much to discuss as the economic crisis has exacerbated the cyclical decline which was already forecast for late 2008. Industry leaders will focus on ways of tackling the difficult times ahead even as several global producers report year-over-year demand declines of 20 per cent or more.
One of the speakers on the opening day, Hassan Ahmed, Managing Director, HSBC Securities (US) will make a presentation titled “The Financial Crisis: Where Does the Global Chemical Sector Go from Here?”. The impact of a steep downturn in the petrochemical cycle will also be addressed as part of other sessions throughout the program agenda.
Abdullah S bin Zaid Al Hagbani, Secretary-General of the Dubai-headquartered GPCA said that the GPCA Forum will offer a comprehensive programme of timely, relevant general sessions that have been designed to address the issues affecting today’s global petrochemicals industry.
Al Hagbani acknowledged that the financial crisis which started in the US is now global and was impacting the real economy including the petrochemicals sector.
“Expectations are for a significant slowdown in global economic growth going into 2009. This is likely to result in excess capacity in many industries including the petrochemical industry and will lead to consolidation, reduced product demand, softer pricing and lower profitability,” he said.
“The combination of a global financial crisis with constrained credit availability along with a recession in major consuming regions and a slowdown in global economic growth creates a very difficult environment for the petrochemical industry – perhaps quite different from anything we have experienced in the past”.
He added: “In terms of the global petrochemicals and chemicals association, there is absolutely no doubt about the Gulf’s strategic importance. By working towards a common goal and sharing our resources we can further enhance the role of this region in international debate, facilitate regional co-operation and ensure growth that is both sustainable and socially responsible.
“We are confident that the GPCA will play an important role towards this end,”said the secretary-general.
He said that over the past 20 years, the Gulf has evolved as a major hub of petrochemical activity now accounting for a major share of global petrochemical manufacturing capacity.
GPCA serves as a regional focal point for Gulf companies to work jointly in addressing common issues such as global warming, best practiced with respect to safe operations, human resources, supply chain operations and a host of activities to strengthen our industry and promote its benefits.