APLA ’12: Slow growth in Brazil impacting petrochemical industry

11 November 2012 12:20  [Source: ICIS news]

RIO DE JANEIRO (ICIS)--A slowdown in the Brazilian economy is impacting the local petrochemical industry, a market source said on Sunday, adding that Brazil continues to rely on imports while the country is expected grow only 1.5% this year.

That compares with growth of 7.5% in 2010, according to the International Monetary Fund (IMF).

Brazil will likely grow slower than the US in 2012, the source said on the sidelines of the Latin American Petrochemical Association (APLA) annual meeting.

The Brazilian economy grew by a meagre 0.5% in the first half of the year despite efforts by the Brazilian government to jump start the economy, according to local news reports.

The slowdown cost Brazil its place as the sixth-largest economy in the world, the reports said.

Brazil now ranks seventh behind Great Britain, France, Germany, Japan, China and the US.

The outlook for Brazil’s economy is brighter for 2013, with the IMF forecasting growth of 4%.

Meanwhile, the local petrochemical industry, which is based on naphtha, is struggling to compete with foreign imports, the source said.

The US is poised to benefit when growth resumes in countries such as Brazil, another source said, predicting that the cost advantage in the US will allow it to meet an eventual increase in demand for petrochemicals in the region.

The APLA conference ends on Tuesday.

Additional reporting by Al Greenwood

By: William Lemos
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