CIA: Brexit effect on UK chemical industry
Published by Francesca Brindle,
Editorial Assistant
Hydrocarbon Engineering,
Despite weakening sales and exports in 2Q16, chemical and pharmaceutical companies are continuing their positive outlook in the midst of significant post-Brexit concerns. The Chemical Industries Association’s (CIAs) second quarter member company business survey found that, looking to the next twelve months, 89% of companies feel research and development investment will either remain the same or increase, 87% of businesses believe exports will either remain the same or increase and 80% feel sales will remain the same or increase. While some investment is expected to take a hit from Brexit uncertainty, three quarters (75%) of companies will maintain or increase capital investment expenditure, while 71% say that employment levels will remain the same or increase.
The survey, conducted after the UK voted to leave the European Union, also highlighted the worries of uncertainty over the future relationship with the Union and the exchange rate, as some businesses reign in investment. On the continuing positive side, members felt there were opportunities for growth through expanded production capacity, new products coming online and other operational improvements. The lower value of sterling is also expected to boost exports, a vital driver of growth for the UK’s leading goods export sector, although as a consequence import costs will increase.
Steve Elliott, Chief Executive of the Chemical Industries Association said “It is right we acknowledge that we are in uncertain times while the country exits the European Union, but our survey shows that there is still confidence that the UK can be a good place to do business. The products and technologies of our companies are vital enablers to the rest of manufacturing. I hope the views of our business leaders will further support the wish for all of manufacturing to invest in the UK, and the Government will do all it can to make it even better for companies to invest here.”
Adapted from press release by Francesca Brindle
Read the article online at: https://www.hydrocarbonengineering.com/petrochemicals/05082016/cia-releases-survey-on-uk-chemical-industry-post-brexit-3862/
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