GCC chemical industry achieves $84.1bn in revenue in 2018

GCC chemical industry achieves $84.1bn in revenue in 2018
Published: 5 December 2019 - 3 a.m.
By: Martin Menachery
The Gulf Petrochemicals and Chemicals Association (GPCA) has highlighted the growth and success of the chemical industry in the Arabian Gulf following the release of ‘GPCA Pulse of the Chemical Industry Report’ at the 14th Annual GPCA Forum, which took place during 3-5 December 2019 at Madinat Jumeirah, Dubai. The report highlights chemical production, exports, sales, job creation and investments made in the Arabian Gulf in 2018.

This year, the forum themed ‘Winning through Strategic Partnerships’ was inaugurated by Dr Mohammed bin Hamad Al Rumhi, Oman’s minister of oil and gas. It included a prestigious speaker line-up that consisted of senior industry leaders, representing some of the world’s largest chemical firms.

The report outlined that the GCC chemical industry achieved a revenue of $84.1bn in 2018, with production capacity reaching 174.8 million tonnes, signalling an increase of 2.8% in terms of contribution to the regional GDP. Due to the increased demand of chemicals by the GCC producers across the globe, the production capacity of the GCC chemical industry was also added by 13.3 million tonnes in 2018.

The report has revealed that Oman’s chemical sector has the highest contribution to GDP among the GCC countries, with 5.1% in 2018, double the figure in the region. This achievement is attributable in part to the manufacturing sector being inscribed within the top five sectors identified by Oman’s National Program for Diversification.

Saudi Arabia has maintained its exceptional standing in 2018, retaining its spot in the top ten exporters of chemicals globally. It is also the region’s powerhouse, with the largest volume output and chemical sales revenue. In 2018, Saudi producers generated $62bn in revenue. The Saudi chemical industry is also a champion in terms of portfolio diversification, with GPCA member companies in Saudi Arabia producing as many as 126 products with a total capacity of 119.2 million tonnes.

Dr Abdulwahab Al-Sadoun, Secretary General, GPCA, commented, “The chemical industry in the GCC is consistently scaling new heights in terms of production, portfolio diversification and job creation. Such success is driven by visionary regional leadership, which is driving economic diversification initiatives that are focused on developing the non-oil sector. This is supported by several government initiatives such as Oman’s National Program for Diversification. Saudi Vision 2030 is also playing a role in supporting economic diversification. As it pertains to the UAE, the chemical sector is situated mostly in Abu Dhabi, where the industry is developed in line with Abu Dhabi’s Economic Vision 2030, which in turn is creating new employment opportunities.”

Dr Al-Sadoun further added, “The employment in the GCC chemical industry increased by 157,000 in 2018 with the UAE being the second largest employer gaining approximately 18% market share in regional employment in the chemical sector.

Against the backdrop of the positive price trends in fertiliser and polymer products, revenue trends in the UAE have increased by 28.4%. The petrochemicals sector in the UAE was characterised by rapid development, with 77% of the current production capacity being launched in the last decade (2008-2018). In 2018, the UAE chemicals output was 14.5 million tonnes, with basic chemicals representing one third (33%), followed by polymers (28%), and fertilisers (30%).

Bahrain’s chemical sector achieved the highest revenue growth of 39% in 2018, attributed primarily to higher revenue from fertiliser products. Bahrain’s production capacity reached 1.4 million tonnes and achieved a revenue of $327mn in 2018.

Kuwait achieved the second highest chemical revenue growth of 32% in 2018. With industrial expansion being a top priority as part of the long-term development priorities in Kuwait’s 2035 strategy, this achievement further cements its position as a global centre for petrochemical production.

GPCA is the trusted source for regional chemical industry information, with over 130 reports published to date. Attended by over 2,000 delegates form 50+ companies each year, the forum serves as an ideal platform for the exchange of chemical and petrochemical-related knowledge, providing access to exclusive market intelligence and unrivalled networking opportunities.

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