Belgium's petrochemical industry to be negatively impacted in 2012 by weak export demand, European and domestic fiscal austerity, market researcher says; country's chemicals, petrochemicals market contributed to 4.5% growth in EU chemicals output in 2011
January 17, 2012
– Research and Markets (http://www.researchandmarkets.com/research/134cf6/belgium_petrochemi) has announced the addition of the "Belgium Petrochemicals Report 2012" report to their offering.
While Belgium is by no means the worst positioned economy in Europe, weakening external demand on the back of fiscal austerity throughout the continent over forthcoming years, in addition to spending cuts at home, will limit the industry's growth potential over 2012.
Belgium's chemicals and petrochemicals market was one of the best performing in the EU in 2011, and contributed to the 4.5% growth in EU chemicals output estimated by Cefic. Strong orders from durable goods manufacturing, particularly in light vehicles and machinery and equipment, coupled with a lack of downstream diversification in the Belgian petrochemicals industry, led to bottlenecks in certain chemical sub-sectors as demand outstripped supply. Construction remains an important chemicals customer and performed comparatively better in the Benelux countries than elsewhere in the EU.
However, activity moderated in H211 and the threat of contagion from the eurozone debt crisis will remain a key threat to economic growth and stability over the medium-term.
The contribution from net trade has also been instrumental in driving Belgium's economic recovery. The pick-up in exports is mirrored in the sharp turnaround in capacity utilization rates. According to the forward-looking indicator compiled by Eurostat, Belgium's capacity utilization rate hit 82.6% in Q211, up from 81.2% the previous quarter, and homing in on the 84% readings seen at the peak of the last cycle.
The export sector has benefited from the recovery in global demand. We do not expect to see a marked reversal in export growth, but do expect to see some moderation in activity; this is in part due to base effects, but is also as a result of the eurozone losing momentum and German growth moderating. As Belgium's export sector is dominated by relatively low technology goods supplying downstream processors in Germany and elsewhere, the country will face increasing levels of competition in this area from emerging market exporters, as they seek to move up the value chain. Companies Mentioned:
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