Using the Chances of Chemistry 4.0 for a Strong Location

Industrial Policy: Using the Chances of Chemistry 4.0

Arguments and Positions

Industry is the basis for Germany’s economic strength. Products and innovations from the chemical-pharmaceutical industry decisively contribute to success. But the environment for companies is changing rapidly: While competitive pressure is growing, the fourth industrial revolution has started – and sustainable management is gaining in importance.

Innovations are the prerequisite for a successful future of Germany; they are increasingly being developed in cross-sector networks. The chemical-pharmaceutical industry with its innovations can make decisive contributions to a sustainable development – by seeing digitalisation and circular economy as an opportunity.

The new era „Chemistry 4.0“ brings a new development stage in the 150-year long history of the industry. In the decades to come, it will be characterised by digitalisation, circular economy and sustainability. The companies will change fundamentally their products, processes and business models. Here, linking chemical and pharmaceutical products with digitial services will be the key for additional value creation. In chemistry, digitalisation means not only the use of internal and external data to optimise business processes; it also means the development of new, digital business models. Furthermore, the companies are working on future-oriented solutions with impulses for a circular management style of the highest possible resource efficiency.

In the next three to five years the industry will invest over 1 billion euros in digitalisation projects and new, sustainable business models. Add to this several billion euros annually for developing resource-saving innovations.

Industrial policy for a sustainable and digital future
Companies need reliable and innovation-friendly framework conditions so that innovative ideas can fast become marketable products, processes and business models. This is because change succeeds best in a political and regulatory environment that encourages new products and investments instead of impairing them. Germany’s existing, largely selective and fragmented industrial policy – which primarily relies on subsidies, extra conditions and planned eocnomy measures – has turned out costly and inefficient. Here, the VCI sees an urgent need for industrial policy action.


  • Strengthen sustainable development through better framework conditions
    Politicians can give impulses for better framework conditions and a secure industry location of the future, by way of the following: tackle urgent infrastructure investments, support the digitalisation of industry, make further efforts for trade liberalisation and a definition of international rules, and ensure that regulation is efficient and legally sound. The chemical industry offers to contribute its expertise.
  • Make Germany fit for the digital future
    For further developing digitalisation, the public sector should expand the technical infrastructure, promote digital education, improve data security and scrutinise data protection rules. The required fast broadband infrastructure should be available by 2025 at the latest. In parallel, a high-performance security network needs to be created in Germany and Europe between public authorities, companies and research facilities.
  • Drive forward the circular economy under industrial policy
    In order to achieve progress in the circular economy, future and existing legislations should undergo an „innovation check“ so that they do not stand in the way of new business models. These points are recommended to stimulate more investment: research promotion for a wide range of technologies, public launch funding for novel projects, easier access to venture capital, encouragement of private-public partnerships for pilot projects. Furthermore, politicians should help bring about in society a basic understanding of a circular economy and transparency regarding its goals and costs.

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Henrik Meincke