Are Iceland's economic woes a potential boon for the chemical industry?

Buy Iceland!

16 October 2008 15:39  [Source: ICB]

I am not making the crazy suggestion that the chemical industry band together and purchase an entire country - only a big chunk of a country

AS THE global financial crisis engulfed Iceland, this near-Arctic island nation's monetary unit, the krona, ceased to function as a currency outside its borders. Early in October, the country nationalized its three major banks. With financial collapse, some are saying Iceland will be forced to return to its fishing roots, and abandon the banking and investment markets that had swelled the country's coffers for a time.

But it doesn't have to be that way. Maybe Iceland can be saved - by turning it into a massive super-mega industrial park. A project akin to global oil major Shell's Eastern Petrochemicals Complex on Jurong Island in Singapore, but grander, huger, more magnificent! Make Iceland - or a section of it - The Icelandic Chemical & Industrial Processing Zone, and set up oil refineries and other petrochemical facilities.

In 2007, Iceland was ranked as the most developed country in the world by the UN Human Development Index. It has a stable government (if not a stable banking system, let's be honest) and a well-educated population that's pretty open minded (Bjork's from there, you know).

Meanwhile, renewable energy provides more than 70% of the country's primary power, and over 99% of electricity there is produced from hydroelectric and geothermal energy (geyser is, after all, an Icelandic word). Before the current economic crisis hit, Iceland was projected to become energy independent by 2050.

If a major petrochemical project were to be started there, the readily available electricity could be factored in toward estimated energy savings. Further incentives could be provided through tax breaks and credits.

Iceland is also in a great location: in the North Atlantic, near the North Sea oil, and essentially between North America and Europe. And if refining in the increasingly bellicose and belligerent Russia is not for you, oil from there could be shipped over for processing.

This project could eventually create so many jobs that there may be a shortage of qualified workers in Iceland!

So why am I sticking my nose in Iceland's business? Well, it's a heck of a lot easier to solve their problems than the ones we have here in the US, that's for sure.

By: Ivan Lerner
+1 713 525 2653

AddThis Social Bookmark Button

For the latest chemical news, data and analysis that directly impacts your business sign up for a free trial to ICIS news - the breaking online news service for the global chemical industry.

Get the facts and analysis behind the headlines from our market leading weekly magazine: sign up to a free trial to ICIS Chemical Business.

Printer Friendly