Highlight some of the critical features of the Gulf Petrochemicals and Chemicals Association.
GPCA was established in 2006 to represent the downstream hydrocarbon industry in the Arabian Gulf. Today, we express the common interests of more than 250 member companies from the chemical and allied industries, which make up more than 95 percent of the chemical production by volume in the GCC. GPCA supports the petrochemical and chemical industries in the Arabian Gulf through advocacy, effective networking and thought leadership initiatives aimed at helping companies connect, share and promote knowledge, contribute to international dialogue and, most importantly, influence have on shaping the future of global petrochemicals. industry. We are committed to providing a regional platform for stakeholders from around the world through our six working committees – plastics, supply chain, fertilizers, international trade, research and innovation and responsible care (health, safety and environment). We organize a series of annual conferences and awards and publish a variety of industry reports and reliable information on the chemical industry in the region.
How extensive is the role of Kizad’s Polymers Park as an anchor body for the local petrochemical industry, enabling the role of Kizad’s Polymers Park for sectoral growth?
The establishment of Kizad’s Polymers Park is an important step forward in the United Arab Emirates’ economic diversification and supports the growth and development of the plastics sector in the region. In addition to their contribution to the plastics industry, the development of value parks, such as Kizad’s Polymers Park, makes a tremendous contribution to socio-economic development. Thanks to the concept on which they are built, value parks, coupled with an equally strong and dynamic base of a downstream industry, help to serve both national and international markets, while multiplying their contribution to GDP and job creation in the region. On average, the combined value of hydrocarbon sources is multiplied 1.9 times when the oil is converted to basic petrochemicals, but is multiplied 8.3 times when the same is converted into a resin; the value of oil increases 15 times if the final product is a downstream conversion product, such as packaging material. The petrochemical industry has a significant job multiplication effect, where 1 job in the petrochemical industry helps to create 4 new jobs elsewhere in the economy. For comparison, a larger downstream penetration has a higher work multiplication effect at 7 times or more. The success of polymer clusters can spur and enable other important non-polymer clusters that further contribute to growth and diversification of the local economy.
How did the GPCA support Kizad and the Polymers Park in its initiatives?
GPCA has continuously advocated for the development of the downstream industry in the Arabian Gulf since its inception and supports its members on their journey to success through its advocacy, networking and thought leadership pillars, coupled with the exponential growth of the industry. Since 2006, we have seen the chemical sector grow from 9.7 tonnes to 33.7 MT in the region – in no case due to the availability of competitive prices, the proximity to key export markets and the collaborative effort and vision of regional leaders. GPCA is proud to have stood by the industry over the years and to have provided a platform for knowledge exchange and the exchange of best practices to support further growth. We have on several occasions presented a platform for networking and collaboration on the topic of industrial clusters. As part of our annual GPCA forum in 2019, we hosted a dedicated session on chemical value parks, in which government and industry leaders discuss how industrial clusters and value parks can be developed, how clusters affect the economic future of a region and the way on which region can draw up strategies and actions to propel its economy, clusters and value parks forward. Kizad’s Polymers Park is a prime example of the United Arab Emirates’ pursuit of value creation and economic development. To create a truly enabling environment in which value parks can flourish, we need to develop tailor-made SME infrastructure, shared services, strong logistics systems, and ensure the integration of services and operations to support demand. as improved utilization rates of assets.
How is the Polymers Park beneficial to GPCA member organizations?
GPCA has a diverse membership base, both geographically and by sector. Our members come from different parts of the world and range from the largest chemical and petrochemical producers in the region, to multinational upstream players to SMEs, converters, waste management companies, logistics service providers and others. Kizad’s Polymers Park benefits our members in a variety of ways. It offers access to competitive raw material prices, favorable investment policies, as well as proximity to major export markets such as Africa and Asia. It brings the polymer value chain together in one centralized hub and helps reduce utilities and supply chain costs, thus contributing to the competitiveness of the local industry. It also helps attract foreign investment to the region.
How do you see the growth of the local polymer industry and the core role of the Polymers Park?
The share of polymers in the region’s production capacity as well as revenue has been significant over the past decade, and the segment will continue to grow in the future. Performance polymers and rubbers grew at the highest CAGR by 20.2 percent from 2010-2020. The strongest contribution to GCC chemical exports over the past decade comes from polymers, which in 2019 claimed nearly one-third of total export volume. At the same time, polymers contributed to nearly half of the chemical sales revenue (48.6 percent) as well as exports (29.6 percent) generated by the GCC industry in 2019, making it the largest contributor to the GCC trade surplus for chemicals. We estimate that the production of commodity products and performance polymers from GCC will reach 38.5 tons by 2030. The UAE’s plastics production is estimated to reach 7.5 million tonnes by 2030, confirming its position as the second largest polymer center after Saudi Arabia. The growth of plastics in the UAE will be spurred by Borouge 4 – the fourth expansion of Borouge’s integrated polyolefin complex in Ruwais – which will more than double the current capacity of 4.5 million tonnes per year of its production area by 2030. The Polymers Park will play an important role in the narrative for the growth of the industry by providing a world-class infrastructure network for all necessary utilities, to ensure a reliable and efficient provision for polymer conversion, and to accelerate investment and innovation in the region’s plastics industry.