28 November 2012 15:36 [Source: ICIS news]
DUBAI (ICIS)--The Gulf's petrochemical industry is currently in the third wave of growth which will see the market moving up the value chain to develop long-term, sustainable wealth, industry consultants said on Wednesday.
The first wave spearheaded oil and gas production in the region and the second led to the expansion of the bulk chemicals industry, Dan Starta, a partner at consulting firm AT Kearney, told delegates at the 7th annual forum of Gulf Petrochemical Companies Association (GPCA) in Dubai.
"Petrochemicals [industry] have grown at hyper speed in the Gulf thanks to favourable market conditions," he said.
The factors that has been driving the growth in the petrochemicals industry includes the abundance in natural resources, a favourable geographic location, extensive government investment, a low cost labour force and the rise in joint ventures that brings in "external know-how", Starta said.
However, the Gulf's petrochemicals industry is not yet fully mature and opportunities exist for growth into key segments on the intermediate chemicals and the end-product application side, AT Kearney said in a report distributed during the forum.
"Forward thinking petrochemical players will expand local manufacturing capacity to meet both local and international demand," it said in a report titled: "Breaking new ground in the downstream petrochemicals sector".
This will include the production of high margin value products such as those in automotive components, paints and coatings, and healthcare, it said.
"With one of the highest population growth rates in the world, expanding downstream will not only contribute to the region's overall GDP but will create fertile ground for many job placements required for the younger population" in the future, the firm added.
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