PETROCHEMICAL MARKETS
Ineos chairman Ratcliffe sees demise of European chemical industry if energy questions not resolved / Open letter to EU president Barroso / “Rabbits with our trousers down”
 Jim Ratcliffe (Photo: Ineos) |
Perhaps emboldened by his recent success in convincing UK and Scottish authorities to support financial aid for an ethane terminal at Grangemouth / Scotland – see Plasteurope.com of 05.12.2013 – Jim Ratcliffe, the chairman of Ineos (Rolle / Switzerland; www.ineos.com) often described as reclusive, has begun to speak out about issues he sees as crucial to the future of Europe’s petrochemicals and plastics industry.
In an open letter to Jose Manuel Barroso, president of the European Commission, dated 7 March, Ratcliffe expressed “deep concern” about the future of the European chemical industry and, while not recommending specific moves, called on the EU to take “urgent steps” to protect it from suffering the same fate that befell the textiles industry in the 1980s.
Painting a dire scenario, Ratcliffe forecast that much of the European chemical industry “will face closure within the next 10 years,” with the loss of more than 1m direct and 5m indirect jobs, if it does not secure its energy base. As one of the “jewels” in its crown, the billionaire businessman said he fails to understand why Europe is “agnostic” about a sector with global revenues of USD 4.3 tr – bigger than the GDP of Germany and bigger than the automotive industry.
The textiles industry, the Ineos chairman took pains to point out, “was wiped out because it could not compete with Asian labour rates.” Another crucial issue he sees for Europe today is its lack of access to cheap energy sources such as the shale gas that is rejuvenating the US petrochemical industry. Across the Atlantic, petrochemical expansion projects worth USD 71 bn already have been kicked off, due to the shale gas boom, and this could grow to over USD 100 bn, Ratcliffe continued. In Europe, by contrast, “closure after closure” is being announced.
“In the face of this collective onslaught,” the Ineos chairman asked rhetorically, what does Brussels’ master plan do to defend the industry against American competition? For him, it seems, the EU has no master plan. “All I can see,” he said, is “green taxes, no shale gas, closure of nuclear, manufacturing being driven away. I can see the competition authorities in Brussels blissfully unaware of the tsunami of imported product heading this way and standing blindly in the way of sensible restructuring.”
“Ineos’ profits in Europe have been halved in the last three years,” Ratcliffe asserted, “while profits in the US have tripled.” Commenting on recent remarks by part-competitor, part-joint venture partner BASF (Ludwigshafen / Germany; www.basf.com) that the world’s largest chemical company for the first time would invest more outside Europe than inside, Ratcliffe summed up his interpretation of the current status quo with a somewhat unusual metaphor, “It’s not looking good for Europe, we are rabbits caught in the headlights and we have got our trousers down.”
e-Service:
Jim Ratcliffe's open letter to the president of the European Commission Jose Manuel Barroso as a PDF file
In an open letter to Jose Manuel Barroso, president of the European Commission, dated 7 March, Ratcliffe expressed “deep concern” about the future of the European chemical industry and, while not recommending specific moves, called on the EU to take “urgent steps” to protect it from suffering the same fate that befell the textiles industry in the 1980s.
Painting a dire scenario, Ratcliffe forecast that much of the European chemical industry “will face closure within the next 10 years,” with the loss of more than 1m direct and 5m indirect jobs, if it does not secure its energy base. As one of the “jewels” in its crown, the billionaire businessman said he fails to understand why Europe is “agnostic” about a sector with global revenues of USD 4.3 tr – bigger than the GDP of Germany and bigger than the automotive industry.
The textiles industry, the Ineos chairman took pains to point out, “was wiped out because it could not compete with Asian labour rates.” Another crucial issue he sees for Europe today is its lack of access to cheap energy sources such as the shale gas that is rejuvenating the US petrochemical industry. Across the Atlantic, petrochemical expansion projects worth USD 71 bn already have been kicked off, due to the shale gas boom, and this could grow to over USD 100 bn, Ratcliffe continued. In Europe, by contrast, “closure after closure” is being announced.
“In the face of this collective onslaught,” the Ineos chairman asked rhetorically, what does Brussels’ master plan do to defend the industry against American competition? For him, it seems, the EU has no master plan. “All I can see,” he said, is “green taxes, no shale gas, closure of nuclear, manufacturing being driven away. I can see the competition authorities in Brussels blissfully unaware of the tsunami of imported product heading this way and standing blindly in the way of sensible restructuring.”
“Ineos’ profits in Europe have been halved in the last three years,” Ratcliffe asserted, “while profits in the US have tripled.” Commenting on recent remarks by part-competitor, part-joint venture partner BASF (Ludwigshafen / Germany; www.basf.com) that the world’s largest chemical company for the first time would invest more outside Europe than inside, Ratcliffe summed up his interpretation of the current status quo with a somewhat unusual metaphor, “It’s not looking good for Europe, we are rabbits caught in the headlights and we have got our trousers down.”
e-Service:
Jim Ratcliffe's open letter to the president of the European Commission Jose Manuel Barroso as a PDF file
12.03.2014 Plasteurope.com [227752-0]
Published on 12.03.2014
German version of this article...