Plastics Industry in the Middle East – Increased Focus on Downstream Petrochemicals to Drive the Sector
Middle East Plastics Industry is Set to Flourish with the Increased Focus on the Downstream Petrochemical Industry
The Middle East plastics industry is expecting a period of huge growth as the countries in the region are focusing on developing their downstream petrochemical industry. The region has a strong basic petrochemical industry which will serve as a feedstock provider for the downstream industry. The cost advantage achieved by the basic petrochemical industry will directly transfer to the downstream industry. The focus on the downstream petrochemical industry will also avoid competition with China in the basic petrochemical industry which is suffering with over-capacity and further capacity will only exacerbate the situation. The plastics industry in the Middle East is growing at a fast pace and it is expected to surpass North America’s plastics capacity by 2016.
Plastics Processing Industry will also Gain from the Diversification Drive
The Middle East has a thriving plastic resin production but its plastic processing industry is very small. The plastics processing industry in the region is scattered and most of the players in the region are small and medium sized enterprises. To encourage the domestic processing industry many countries in the region are planning to start cluster programs. Under a cluster program, plastics processors can establish their unit in one single location known as Polymer Park. The processing units will benefit from the integrated supply chain and tax benefits by the government. These polymer parks will cater to the domestic plastics conversion industry and will increase the finished and semi finished plastics output.