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European Chemical Industry

The chemical industry is the third largest manufacturing sector in the European Union, which represents a huge slice of the EU GDP and provides jobs for 4.7 million Europeans. It is one of the top three industries in at least 11 of the EU’s 25 member states and its annual sales (€ 519 billion in 2001) are greater than some member states’ GDP. The European chemical industry is not only a powerful economic force in itself, it underpins virtually a wide range of other industrial sectors. As well as supplying essential raw materials, it provides much of the technology and innovation that enable other industries to develop new products and services.

Despite its strengths, the European chemical industry faces considerable challenges. Their costs are higher and their profit margins lower than many of their international competitors. Chemistry is one of industry’s most highly regulated sectors - and nowhere more so than in the EU. Over the last 30 years, the EU has generated more than 300 directives, regulations, decisions and recommendations relating to chemicals and consumer protection, occupational health, environmental protection, process and transport safety and the management of chemical substances. These rules, together with those at national level and from global conventions, form the legal basis within which the European chemical industry operates. They ensure that chemical industry in Europe is safe and generates products of high quality that contribute to Europe’s wealth and standard of living.

However, on its way to an increasingly sustainable branch the European chemical industry has to meet the actual challenges of worldwide competitiveness. For example, bringing today a new chemical to the EU market takes three times longer and costs ten times as much as in the US. Moreover, personnel costs and wages become more and more a key issue in international competitiveness, in particular for the chemical industry. Their employees are often better qualified, trained and paid than the average industrial worker. Personnel costs in the EU chemical industry are typically 50% higher than in other manufacturing sectors.