Germany chems producers fear 2013 election year could harm industry

12 December 2012 17:43  [Source: ICIS news]

LONDON (ICIS)--Germany’s chemical producers fear that the 2013 federal election year could end up harming developments in the industry, Karl-Ludwig Kley, president of the country’s chemical trade group VCI, said on Wednesday.

The elections will likely be held in late September, with Chancellor Angela Merkel seeking the re-election of her Christian Democrat-led coalition government.

Kley said that in light of the ongoing campaigning, politicians and legislators could defer decisions on a number of political projects and issues important to Germany’s chemical sector.

The president of Frankfurt-based VCI pointed in particular to planned changes in Germany’s energy policies and the phase-out of nuclear energy – an area where important decisions have yet to be made, he said. 

Kley also warned against tax increases that have been proposed by some politicians and parties in the run-up to the election.

Germany does not have a revenue problem but rather an expenditure problem, Kley said.

As such, it was wrong to begin a discussion about new or higher taxes, which could harm the country’s many smaller and medium-sized industrial firms, including chemical producers, he said.

At the same time, the government must not neglect to continue promoting free trade in 2013, Kley added.

He pointed to the EU’s trade with the US. While average tariffs for chemicals were relatively low in both the US and the EU, in absolute terms the high level of bilateral trade volumes between the two regions resulted in high duties and costs for producers, he said.

“The competitiveness of Germany’s industry must be at the top of the political agenda next year as well,” Kley said.

In light of the difficult global economic situation, Germany could not afford a year of log-jam and stalling, he said.

Germany’s chemical production is expected to increase by 1.5% in 2013, VCI said earlier on Wednesday. The increase in production next year would come after a 3.0% year-on-year decline expected for 2012.

By: Stefan Baumgarten
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