Volume growth ahead for chemicals in 2000
29 Mar 2000
The lean times for the chemical industry in Europe, and especially the UK, seem to be over - for the moment at least. That was the message from the Chemical Industries Association's economic panel, announced by BP chief economist Malcolm Mitchell at the CIA's Business Outlook Conference. The growth trend which began last year will continue, he said, with UK chemicals output growing by 4.5 per cent over the year.
The rapid recovery is due to the odd nature of the recent slump, which hit exports and inventories while household consumption and investment remained buoyant. Now that stocks have declined and world trade largely recovered from the Asian crisis, `overall activity is rising smartly,' Mitchell said.
After the gloom of the 1990s, which Mitchell described as `a dismal period for Europe - the weakest decade for growth since the 1930s,' the new millennium seems to be starting brightly. `We begin on a rising tide, and although there are the proper reservations, there is no doubting that back in the midst of the Asian crisis, we would more than willingly have settled for the current prospects for the year 2000,' he said.
However, the industry should not relax, said Mitchell - particularly in its efforts to improve its public profile. `The stipulation is for dialogue of the highest order,' he said. `Perhaps Europe needs to speak with one voice through many mouths.'
Meanwhile, Dow Europe president Luciano Respini signalled a shift in the attitude of the US giant to the concept of the `triple bottom line' - judging the performance of the company on the basis of environmental and social factors as well as economic ones. Recent events, notably the anti-capitalism demonstrations in Seattle and London, should warn the chemical industries that they are risking losing their `licence to operate' if they continue to place too much emphasis on their share price and dividend. `Shareholder value can no longer be a measure of the rightness or wrongness of corporate decisions,' he said.
