24-11-2014

Saudi Aramco outlines vision for GCC chemicals industry

Khalid A. Al-Falih, President and CEO, Saudi Aramco called for greater integration, innovation and collaboration across the region's petrochemicals industry to unlock its potential and drive a ‘golden decade’ of economic growth and job creation.

Speaking at the 9th Gulf Petrochemicals & Chemicals Association (GPCA) Forum, November 24, Al-Falihsaid that over the past decade “overall regional development in the petrochemicals industry has focused on the manufacturing of commodities for exportby leveraging our feedstock advantage, economies of scale, and extensive industrial infrastructure,”adding that “we have tended to grow horizontallyrather than through vertical integration.” Al-Falihexplained that “the existing model will not realize our full potential because the global industry landscape is changing rapidly and creating stronger competition.”

Al-Faliha ddressed four key imperatives that would further unlock the region’s potential in the petrochemicals industry:
* Developing a balanced portfolio of chemical feed-stocks to drive flexible economic growth across the sector;
* Upgrading the region’s existing chemicals infrastructure to build world-class capability and accelerate innovation;
* Multiplying the number of industry participants by encouraging a vibrant small to medium-sized enterprise sector and strengthening entrepreneurship; and
* Applying greater integration and critical mass to tackle the region’s infrastructure, technology and skills challenges.
Al-Falih said that harnessing the region’s competitive advantages would help drive economic diversification into high-value manufacturing sectors and could create new, high-skilled jobs to sustain the region’s growth.He added that decisions made today and tomorrow will determine the region’s long-term prospects in the global economy. “Working together and acting in our common interests, the region’s chemicals industry has the ability to transform the entire region from a base of natural resources to a knowledge-based economy,” he said.

Al-Falih highlighted the region’s ‘youth bulge’ - a demographic shift of a new generation of men and women- and the need to embrace and engage their talents as the region’spetrochemical industry evolves. He said: “Over the long-term our youth population will prove to be the region’s single greatest competitive advantage. Companies should tap their creativity, entrepreneurial spirit and love of technology as part of their strategy to drive growth. Energetic, wired for technology, and with an appetite for constant learning, our youth can make the difference in propelling our collective industry forward,"he said.

In conclusion, Al-Falih called upon the region's petrochemical industry leaders towork towards realizing a‘golden decade’ of economic growth and job creation, adding that to achieve this "we need more effective integration, innovation and collaboration across theGulf petrochemicals industry.It is time to make the vision a reality by redoubling our commercial and technological collaboration and accelerating our combined pace of change.