BMI have said in a new report that the Algerian petrochemicals market continues to evolve with the development of the industrial and agricultural sectors at a time when basic chemicals and fertiliser production is set to surge.
There is optimism with BMI regarding the prospects for growth in the Algerian petrochemicals market in the context of rising, yet not spectacular, economic growth. Real GDP growth in Algeria of 3.3% in 2013 and 4.6% in 2014 is anticipated, from the 2.2% in 2012. The acceleration in growth last year is mainly attributed to low base effects, and given slow projected petroleum production growth and the lack of structural reforms, the economy will grow below potential over the medium term. However, industry should remain broadly supportive of rising petrochemicals consumption, even as the non-oil economy slows.
BMI report that current project delays mean that the realisation of the country’s full potential in petrochemicals is unlikely to happen in the next quarter. The delays will not only raise costs and lead to a narrowing of margins in the long term, but also create a more opaque business environment that will undermine progress and put the industry’s significant cost advantages at risk.
Adapted from a press release by Claira Lloyd.
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