GCC chemical projects worth $71bn amid pandemic recovery

GCC chemical projects worth $71bn amid pandemic recovery

RIYADH: Gulf petrochemical projects worth $71 billion are expected to become operational between 2020 and 2024, Al Eqtisadiah reported, citing the Gulf Petrochemicals and Chemicals Association (GPCA). Regional chemical production expanded 1.5 percent last year compared to a global decrease of 2.6 percent, it said. Increased demand for raw materials used in medical equipment helped the industry navigate through the pandemic. This enabled companies to maintain stable operating rates of 93 percent, as commercial activity started to recover in the third quarter of the year. Still, the regional industry has posted a two-year decline in revenues, said GPCA secretary general Abdulwahab Al-Sadoun. He said the challenges facing the sector have been exacerbated by supply chain disruptions related to the closure of ports in China and increases in freight rates up to three times the market price before the epidemic, he explained. This increase has eroded the profits of GCC producers who were already operating on thin margins, he said.