Overview
The Chemicals Sector strategy aims to increase its global and regional presence by using its current strengths in Basic and Intermediate Chemicals. Saudi Arabia is in a good position to become a regional and global leader in Specialty Chemicals, Plastics & Rubber Conversion and Inorganic Chemicals by using its existing strengths in upstream chemicals and minerals.
The Specialty Chemicals and Plastics, Rubber Conversion and Inorganic Chemicals sectors offer a promising investment opportunity for Saudi Arabia for four main reasons:
Investing in the Specialty Chemicals and Plastics & Rubber Conversion sectors can help to increase localization, not only in the chemicals industry itself, but also in related industries such as automotive, building materials, food processing, and pharmaceuticals.
Specialty Chemicals and Plastics & Rubber Conversion offer higher margins and create more jobs than Basic and Intermediate Chemicals. This advantage can be used to attract different types of international companies and bring in talent and technologies.
The global and regional demand for both Specialty Chemicals and Plastics & Rubber Conversion is growing, and Saudi Arabia can take advantage of this to increase its production volume and become a major regional and global player in these markets.
Saudi Arabia’s large reserves of non-carbon raw materials will drive the expansion of downstream inorganic chemicals and encourage investment in this value chain.
The National Industrial Strategy (NIS) which was announced by the Ministry of Industry and Mineral Resources is set to have a significantly positive impact on the Kingdom’s economy. KSA enjoys a unique position through which it can benefit from its natural resources, technical and production capabilities to maintain its global leadership in the petrochemicals industry, in addition to expanding in final value chains to ensure maximization of the economic and social impact and enhancement of the industrial supply chains in the Kingdom. The local economy is expected to be positively impacted by the growth of the prioritized industries which will improve the GDP and jobs creation.
KSA’s global share in chemicals volume is 4.7%, with a portfolio concentrated in basic and intermediate petrochemicals with some downstream petrochemicals.
Global population is increasing where companies need to fulfill global demand by increasing their capacities.
Besides the current position of the Kingdom in basic and intermediate petrochemicals, KSA is well positioned to further strengthen its presence in other sectors such as specialty and conversion chemicals to become a global and regional leader in the petrochemicals industry.
KSA’s specialty chemicals growth is expected to outpace the moderate 2.3% CAGR forecast for the MEA region. The sector’s capacity plan is set to grow by 6.7 million tons to reach 8.7 million ton per annum (MTPA) by 2035. KSA’s plastics and elastomers conversion growth is expected to outpace the moderate 4% growth for MEA region. While MEA capacity is forecasted to slightly increase, KSA capacity is forecasted to quadruple by 2035. KSA’s plastics and elastomers conversion capacity is expected to grow by 8.8 million tons to reach 11.5 million ton per annum (MTPA) by 2035.
Additionally, the Kingdom has large reserves of non-Carbon raw materials available to push for the expansion of its downstream inorganic chemicals in the local market and the region. Inorganic chemicals are expected to grow at a 2.5% CAGR globally and at a 3.2% in MEA through 2030. With this potential growth, inorganic chemicals in the Kingdom are estimated to grow by ~4 times through 2030.
The Chemicals Sector aims to be a world-leading industry that is fully integrated across the value chain, from raw materials to finished products, and powered by cutting-edge infrastructure and R&D, providing ever-increasing value to Saudi Arabia.
The goal is to increase the production capacity of downstream chemicals by fourfold by 2035, which will maximize the social and economic impact in Saudi Arabia. The impact by 2035 is as follows
Market
2021
212 B
Impact by
2035
58.2 B GDP
108 K JOBS
We are Available
For more information and inquiries please contact us
