Statement to the press

Dr. Klaus-Dieter Juszak

Chairman of the German VCI Sector Group of Chemical Parks and Sites

(Fachvereinigung Chemieparks/Chemiestandorte im VCI), Frankfurt am Main

(The spoken word takes precedence)

_______________________________________________________________________

Ladies and Gentlemen:

Also in difficult economic times, chemical parks and sites are a good basis for successful business activities – for two reasons:

1.        The operators of chemical parks and sites ensure smooth production. They professionally take care of all tasks beside production activities, literally speaking from A to Z: Supplies of primary chemicals via internal piping networks, central and specialized facilities for all kinds of repairs, supplies of water, electricity and steam. They are responsible for security, too. In most cases, the range of services also includes a sewage plant, waste disposal and much more in environmental protection, industrial health and safety and plant safety.

2.        Not having to worry about these tasks is an essential element for chemical companies at chemical parks and sites. In over 40 chemical parks and sites in Germany, manufacturers are free to focus on the essential point: The production of chemical products. They do not need to build up their own infrastructure at high cost.

This is why the German concept of chemical parks and sites is successful and geared for the future. This is substantiated in a survey conducted by the VCI Sector Group of Chemical Parks and Sites, which we want to present here today. Our survey covers the period from 2006 to 2008^[1], i.e. the period before the economic crisis.

Rising number of companies

The number of companies located at German chemical parks further increased over the past three years: Back in 2006 there were about 840 companies, compared with nearly 920 companies in 2008. These figures reflect an increase by almost 10 percent.

More staff: 10,000 new jobs

Since 2006 some 10,000 new jobs have been created at German chemical parks: In 2008 the number of staff totalled 240,000 persons.

But let us take a closer look at the development of the employment situation: Chemical manufacturers have cut their own staff; they are focusing on their core competencies. But they are increasingly using the possibility of having tasks, which are essential to plant operation, performed by specialized internal service providers – such as, maintenance activities, waste disposal and energy generation.

By contrast, internal service providers at chemical parks and other service companies have hired more personnel to take on such tasks. Chemical manufacturers and other manufacturing companies benefit from this division of labour, as is shown by the rising number of companies at these sites: The described division of labour with the concentration on core competencies within the chemical companies, site operators and service providers creates jobs!

What about the employment structure in our chemical parks? Some 55 percent of staff at these chemical sites work for chemical manufacturers, including their research departments. Just under 40 percent of staff work for non-manufacturing businesses. And over 5 percent work for other manufacturing companies at these locations or for independent research facilities.

More investments

Our survey brings another encouraging result: In the period from 2000 to 2008 chemical parks annually invested some 3 billion euros in new plants and in the expansion of existing ones. In 2008 the mark of 3.5 billion euros was reached for the first time. It is particularly noteworthy that chemical manufacturers have an outstanding role among manufacturing companies: Chemistry accounts for over

80 percent of industry's investment spending. This clearly shows approval and acceptance for the concept of chemical parks.

Ladies and Gentlemen:

Just put yourself in the situation of a company from China, India or the USA that wants to locate its chemical operation in Europe. Why should you come to Germany? Mr Pfeiffer informed you about the general location advantages of our country. I mentioned the numerous benefits of chemical parks in the first part of my talk. Further advantages are reliable energy supplies, the integrated or composite structures, and the joint purchase of raw materials and intermediates. I have today chosen the motto "connecting role of chemical parks” as a further aspect, and I want to highlight yet two more advantages of this infrastructure: The research network and logistics.

Chemical parks attract not only manufacturing companies and service providers for industry. Germany has a unique network of university and extra-university research facilities. Quite frequently, they seek the direct neighbourhood of chemical locations or chemical parks. Our survey shows that every second chemical park or site is directly connected to a research network, because the chemical industry depends on a continuous flow of research results. This is substantiated by the fact that almost 10 percent of chemical staff work in R&D departments. Even in difficult economic times as we are going through right now, chemistry wants to keep up its high spending on research and development – because we want to emerge stronger from the global economic crisis.

Furthermore, many chemical sites are organized in regional initiatives with a direct orientation to the chemical industry: In so-called chemical clusters. The close proximity to institutes and other research-based companies – often large companies – have positive effects: Productivity of companies improves at chemical parks.

But success is not limited to cooperation agreements between small and mid-sized enterprises and large businesses. Cooperation between industry and science brings economic success, too. This is shown in surveys among experts, held by the World Economic Forum: When asked about cooperation between industry and science in R&D, Germany is always in the top group. In order to keep up this level also in the future, we expressly welcome the federal research minister's efforts towards research promotion through fiscal measures for companies. It is important that this form of promotion benefits small and mid-sized high-tech enterprises in chemical regions as well as large businesses. Quite often, large businesses are the driving force in "innovation alliances".

R&D is not the only field where chemical parks are well-networked. Another major plus is our good logistics and transport concept: This holds true for both the purchase of raw materials and chemical exports. Two thirds of chemical exports from Germany go to other member states of the European Union. The importance of trade to Germany is another reason why the network of transport routes is woven twice as closely as in the European average. In order to supply customers in the European Union and globally in a timely manner and to ensure reliable deliveries of pre-products, chemical parks are excellently connected to the transport infrastructure. This means not only roads and railways but, in many cases, also ports. Chemical parks in Germany are connected to a worldwide network of pipelines, which provide German chemical locations with the necessary raw materials. Our survey shows that almost all chemical locations have a railway connection, over 40 percent are connected to pipelines, and every third location can be reached by maritime transport or inland waterways. Over 50 percent of raw materials processed at chemical parks and sites do not arrive by road. 15 percent of inputs are transported in pipelines, 10 percent via waterways, and one third by rail.

Yet one more advantage: Numerous specialized logistics providers enable high quality and safety standards in filling, packaging and intermediate storage. They also ensure the smooth transport of chemical products. This makes them ideal partners for all companies in our chemical parks.

Ladies and Gentlemen:

Needless to say that chemical parks are impacted by the economic crisis, too. But I am confident that our chemical parks will manage well also in this difficult period. The concept of chemical parks in Germany is a success story with prospects for the future. Many companies appreciate the advantages of this concept, which is unique worldwide. According to a recent study by the American chamber of commerce AmCham, Germany is no. 1 in Europe on the list of attractive locations for US investors – irrespective or because of the present crisis.

Just some brief words on our cooperation with "Germany – Trade and Invest", the foreign trade and inward investment agency of the Federal Republic of Germany. We are promoting the chemical industry location Germany with a joint stand here at Achema. And we are glad that Mr Pfeiffer of "Germany – Trade and Invest" actively supports us in our efforts by using his competence and energy to internationally advocate the German concept of chemical parks.