Chemical industry has to invest US$ 199 billion up to 2020
DCI
The national chemical industry will have to invest US$ 199 billion over the next 10 years to meet the growth of the domestic demand and revert the Brazilian trade deficit, which this year shall exceed US$ 25 billion. That is the forecast of the Brazilian Chemical Industry Association (Abiquim) that presented the BNDES and the Government the Pact of the Chemical Industry in which it asks for incentives to sustain the forecast of investments and prevent the increase of the deficit in the trade balance in the sector that may reach US$ 37 billion if the average growth of the country remains at 4% a year by 2020.
In the document, the entity requests the Federal Government to adopt measures that protect the sector so the companies are able to invest in the growth of the local production. Among the topics are the simplification of taxation in the productive chain, access to cheaper raw-materials and energy, more investments in infrastructure and logistics, more action in the protection of the internal market against the imports, support to innovation and technology and support of the BNDES (National Development Bank) for the modernization of the productive park and credit to small and medium-sized businesses.
According to Bernardo Gradin, President of Braskem, and also President of the Board of the Abiquim, the sector needs repositioning regarding the investments so that they do not become a hindrance to the sustainable growth in Brazil, because it is a basic industry that is responsible for nearly 18% of the Gross Domestic Product (GDP) of the country that gets to other productive chains. "For the industry to continue investing it requires a new model that includes the access to cheaper raw-materials and energy and simplification of taxes", said Gradin. "I think it is hard to achieve the goal of recovery of the deficit in the sector without such incentives, because the chemical industry relies on long-term investments", he stressed out.
For João Zuñeda, of MaxiQuim, such deficit in the balance of trade of the chemical sector is structural and its pillars are the high costs of the inputs and the lack of investments in technology and in production increase. In his opinion, this is the result of decades of delay in the sector, which shall take up to 20 years to reverse such situation.