INSIGHT: US manufacturers raise chemicals alarm

28 September 2006 17:44  [Source: ICIS news]

By Joe Kamalick

 

GAITHERSBURG, Maryland (ICIS news)--US officials and American manufacturing executives convened an urgent and unique meeting here this week about the growing global threat of chemical regulations - but they didn’t invite any major US chemical producers.

 

Major chemical companies weren’t invited, said William Koch, deputy director for chemical science at the US National Institute of Standards & Technology, because the chemical industry is already well aware of what Koch and others see as rising risks for all US manufacturers under expanding international chemicals regulation.

 

“What we’re trying to do instead,” said Koch, “is to raise awareness among all the other manufacturing sectors about the increasing risks to them and their overseas markets because of chemicals regulation abroad.”

 

The National Institute of Standards & Technology is the US government agency that promotes US innovation and industrial competitiveness. It co-sponsored the gathering of government officials and manufacturing executives along with the American Chemical Society and automotive manufacturing interests. 

 

Hratch Semerjian, chief scientist at the institute, told executives of the automotive, aviation and aerospace, electronics and computer industries, among others, that the growing body of chemical regulatory programmes, chiefly in Europe but increasingly in Asia and elsewhere, “represents a huge cost impact for US manufacturing in multiple markets and effectively serves as a barrier to trade.”

 

“Manufacturers of industrial chemicals are already well aware of the growing restrictions that face their products globally,” Semerjian said. “But the impact of emerging chemical regulatory issues affects all manufacturing downstream of chemicals production.”

 

Because chemicals and chemical products make up 16% of the material value inputs in automotive manufacturing, 33% in semiconductors and 30% in medical supplies, for example, all of those products and many more are increasingly subject to chemical management and regulation abroad.

 

Semerjian cited the European Union’s registration, evaluation and authorisation of chemicals (Reach) policy as only the most obvious developing regulatory programme that threatens US manufacturing. There was a veritable alphabet soup of other EU or UN chemical regulatory programmes, many of which were migrating to and mutating in other regions, including East Asia.

 

It is not a question of stopping the growth of global chemicals regulation, Semerjian said, noting that the environmental objectives in most cases are laudable, even if some of the proposed solutions represent overkill. Rather, it was the apparent failure of US manufacturing interests other than chemicals to marshal their considerable scientific and technical knowledge to - with US government policy help - influence foreign regulatory developments before they become so threatening.

 

“It is a question of market access,” Semerjian said, arguing that US manufacturers lack an early warning system that will allow US scientific and policy influences to affect future international regulatory developments. “It seems like we’re always playing catch-up, that we’re always one step behind” foreign regulatory developments, he said.

 

He called for a new coalition of government and manufacturing interests from across all sectors for information sharing and advocacy. He warned that US jobs and global competitiveness for US industry are at stake.

 

Michael Taubitz, the regulatory liaison officer at General Motors Corp, said that US manufacturing in general “needs a strategic approach to emerging chemical issues”.

 

He said that a General Motors survey of multiple industries represented among the auto giant’s suppliers “found that chemicals was the number one concern of each industry sector”.

 

“Whether they were intended as such or not,” Taubitz said, “these chemical regulatory issues are emerging as barriers to trade.” Taubitz and others in the meeting of some 50 government and industry representatives suggested that the net effect of the EU’s imminent Reach programme will be to de-select US suppliers to the European marketplace.

 

The public and private sector representatives said they did not intend to take positions on any foreign regulatory issue or to challenge legitimate regulation, but they hoped to initiate a multi-sector business, scientific and technical strategy to meet new chemical-related rules and regulations worldwide affecting US manufacturing.

 

“What’s coming next?” said Taubitz. “Without question, it will be still more regulation.”

By: Joe Kamalick
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