Mixed Economic Developments in German Chemical Industry

Mixed Economic Developments in German Chemical Industry

Author: ChemistryViews.org

The economic situation of the German chemical industry was mixed in the 1st half 2015. Production increased by 1 %, but sales only rose by 0.5 % due to falling prices. The devaluation of the euro stimulated overseas exports while the domestic demand for chemical products remained restrained. Overall, the production in Germany’s third largest industry rose by 1 %. A moderate upward trend is expected in the coming months and a growth of 1.5 % in chemical production predicted for the overall year 2015.

German chemical companies are increasingly investing abroad. According to a survey of the German chemical industry association Verband der Chemischen Industrie e. V. (VCI), this is not only to open up new markets but also because of lower costs. The favourable raw material and energy prices through the shale gas boom stateside play a role. But also one third of foreign investments are made in European neighboring countries because the costs there are lower than in Germany. Even among small and medium-sized chemical enterprises (mainly the “Mittelstand”) now the cost argument significantly influences investment decisions, so the VCI. The massively risen EEG-Umlage – the charge in connection with the German renewable energy act – is seen as a particularly heavy burden on SMEs.

Marijn Dekkers, the President of the VCI calls for an industry policy initiative which significantly improves the investment climate; more planning security for companies as regards the energy political requirements is needed. For Dekkers, reducing the obstacles to innovation is another lever for political measures. This would be helpful not only for the chemical industry with its structural change towards research-intensive products but for Germany as a land of industry overall.


 

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