Celanese head: Global chem industry faces five challenges

14 February 2000 06:27  [Source: ICIS news]

SINGAPORE (CNI)--The global chemicals industry is seeing five major trends that will revolutionise the way business is conducted, and companies need to adopt major changes to meet these challenges, according to Claudio Sonder, board chairman and chief executive officer of Celanese, in addressing the Fifth Asia Pacific Chemical Industry Meeting here Monday.

Sonder said the five developing trends are:

• Pressure to change and create value. As the structure of capital markets changes, chemical companies are being pressured into implementing quick structural reforms to meet these changes, giving rise to more mergers and acquisitions to create value for customers and shareholders.
• Focus on critical mass. Increasingly, diversification is seen as a burden, and companies increasingly are looking at generating synergies that will enable them to meet the rising demand of customers for critical mass. Companies also are becoming more socially responsible in the way they conduct business.
• Increasing global competitiveness. Asian and Middle Eastern chemical producers are becoming formidable forces, and global majors are finding it more viable to engage these producers as joint venture partners to generate future growth.
• Information technology. This is becoming an essential tool in the industry, with electronic commerce expected to play a significant role in the global chemical marketplace.
• Electronic business (e-business), which is becoming a new tool for transactions and is creating new business platforms, especially for chemical logistics operations.

In meeting those challenges, Sonder said, chemical companies must refocus and restructure to take advantage of future growth opportunities. He added that speed is crucial.

"No business will remain truly local. With rapidly changing markets, liberalised capital and electronic communications, it is necessary to think globally and to act locally under a global perspective," Sonder stated.

By: Wing Gar Cheng
+65 6780 4359

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