17 December 2009 10:31 [Source: ICIS news]
By Prema Viswanathan
SINGAPORE (ICIS news)--The doctrine of globalisation has never been more attractive to ?xml:namespace>
With economies on the mend after the worst downturn in a decade, producers in the gas-rich region, saddled with a ballooning surplus, are keen to make forays into markets where consumption is bullish.
The most attractive market currently is Asia, in particular
Targeting growing markets is extremely important for
Understandably, the issue that agitated delegates at the Gulf Petrochemicals and Chemicals Association (GPCA) forum held in
On the podium and off, industry players from the Gulf Cooperation Council (GCC) region or those with major interests in it, warned of the dangers of erecting trade barriers between countries in a bid to protect the domestic industry.
The strongest initiative in combating protectionism came from the GPCA itself. "GPCA will strengthen coordination with GCC governments to ensure that exports of petrochemicals and chemicals from the Gulf region are not restricted by anti-dumping regulations and other trade restrictions," said the organisation’s secretary general, Abdulwahab Al-Sadoun.
Sipchem, a major methanol and butanediol (BDO) producer, is one of the companies severely affected by the imposition of preliminary anti-dumping duties against butanediol, levied by the Chinese government in June this year.
Rumours were also rife early this year that the Chinese government may launch anti-dumping investigations against polyethylene imports from several countries, including some in the Middle East, but these died down due to
SABIC (Saudi Basic Industries Corp) is also under pressure, facing as it does anti-dumping duties on polypropylene (PP) which
Dumping, under international trade law, occurs when a manufacturer in one country exports a product to another country at a price which is either below the price it charges in its home market or below its cost of production.
The affected producers contend that the charges are baseless even as producers in
““Competition in the market is healthy for everybody [for producers as well as consumers]. That’s why we are against trade barriers, we want competition. Competition is good for us because it makes us work harder and go for innovation and cost reduction programmes,” said SABIC CEO Mohamed Al Mady in an interview with ICIS news, reiterating the need to keep competition alive, whether it is between countries/regions or between companies in the same country or region.
The GPCA advocacy committee had been set up “to deal with issues related to trade such as anti-dumping duties which are facing our industry and to make sure they are handled in a proper way,” the SABIC chief said.
Similar sentiments were expressed by
With petrochemical capacity in
"The current trend of governments resorting to trade barriers to protect domestic petrochemical industries is a matter of great concern to GCC producers, who are net exporters of petrochemical products and have huge capacities coming on stream," said Hamad Al-Terkait, vice-chairman of the GPCA and CEO of Equate Petrochemical.
A source close to an Indian PP producer argued that
Alongside their efforts to make governments of the importing countries see their point of view, however, GCC players are also seeking to diversify their markets and develop more value-added products, thus reducing their exposure to large markets and commodity petrochemicals, where competition is more severe.
Whether the GCC players’ new growth strategies or negotiations with the importing countries succeed or not, for the moment, the turf war seems far from over, as more and more players seek a slice of the same pie.
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