Transcript Slide 1

INTERNATIONAL
COUNCIL OF
CHEMICAL
ASSOCIATIONS
CHEMICALS AND THE DOHA ROUND
Monday, June 13, 2005
World Trade Organization
Geneva, Switzerland
International Council of Chemical Associations
(ICCA)
• Council of chemical industry associations from:
Australia, New Zealand, Japan, Europe, North and South
America, and South Africa
• Represent approximately 75% of global chemicals
production
• World chemical production is $1.9 trillion annually and 40%
of this is traded internationally
• Develop industry positions and programs on international
issues:
health, safety, and the environment; international transport
safety; intellectual property; trade policy; elimination of
chemical weapons
• Promote and coordinate Responsible Care® and other
voluntary chemical industry initiatives
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Size of Regional Chemical Industries, 2003
($ billion)
$505.8
$650.3
$70.8
$541.5
$74.9
$101.1
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Value of Chemical Inputs in Consumer Products
12%
Computers
12%
14%
Handbags
Optical equipment
Household appliances
16%
16%
Wood household furniture
21%
22%
Office furniture
Sporting goods
28%
30%
Clothing
Agricultural production
33%
34%
Semiconductors
Batteries
35%
37%
Footwear
Curtains & draperies
44%
47%
CDs & tapes
Rugs & carpets
68%
Cosmetics & toiletries
75%
Cleaning compounds
84%
0%
20%
40%
60%
80%
Medicines
100%
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World Chemical Output & Trade
($ billion)
$900
$1,900
$800
$1,700
$600
$1,300
$500
$1,100
$400
$900
$300
$700
$200
$500
$100
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99
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20
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20
02
20
03
Output
$1,500
Output
Exports
• During the 1980s, world chemicals exports grew 1.3 times as fast as world chemicals output.
• During the 1990s, world chemicals exports grew 2.5 times as fast as world chemicals output.
• 35% of this world trade is intra-company.
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Exports
$700
Chemicals as Share of World Merchandise Exports
(share based on value)
Source: WTO
1995
2003
Machinery and transp. equip.
17.5
17.0
Mining products
10.9
13.2
Office and telecom equipment
12.1
12.8
Chemicals
9.7
10.9
Automotive products
9.2
9.9
Agricultural products
11.7
9.2
Other consumer goods
8.6
8.8
Other semi-manufactures
7.9
7.2
Clothing
3.2
3.1
Iron and steel
3.1
2.5
Textiles
3.0
2.3
.
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Change in Share of World Chemicals Exports
1990
2000
Developed countries’ share of world
chemical exports
83.5%
79.3%
Developing countries’ share of
world chemical exports
16.5%
20.7%
World chemical exports
(billions)
$308.8
$570.2
Source: UNCTAD
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Global Chemical Industry Rankings, 2001
$ billions, employees thousands
1 EC
2 United States
3 Japan
4 China
5 Korea
6 Brazil
7 India
8 Taiwan
9 Russia
10 Switzerland
11 Canada
12 Mexico
13 Argentina
14 Australia
15 South Africa
16 Turkey
17 Singapore
Output
484.7
454.1
213.0
108.8
53.4
38.3
36.8
32.8
29.1
27.7
23.9
12.5
11.5
11.4
10.5
10.0
8.8
Exports
125.6
80.2
33.7
14.0
12.5
3.5
3.8
7.2
5.3
24.2
13.0
3.3
3.8
2.8
2.0
1.1
9.6
Imports
74.2
78.9
23.1
32.0
12.9
10.5
5.6
15.6
9.1
15.2
20.4
9.2
3.8
6.9
3.1
7.8
8.0
Sales
433.7
452.8
202.4
126.8
53.8
45.3
38.6
41.2
32.9
18.7
31.3
18.4
11.5
15.5
11.6
16.7
7.2
Employees
1,900
1,022
366
3,288
129
280
727
126
729
62
94
66
59
44
175
40
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Global Chemical Industry Rankings, 2001
$ billions, employees thousands
18 Malaysia
19 Saudi Arabia
20 Israel
21 Thailand
22 Philippines
23 Indonesia
24 Colombia
25 Venezuela
26 Ukraine
27 Pakistan
28 Chile
29 Egypt
30 Bulgaria
31 Peru
32 Belarus
33 New Zealand
34 Romania
Output
Exports
Imports
Sales
Employees
8.1
7.3
7.0
6.1
5.8
5.6
5.6
4.6
4.0
3.8
3.7
3.0
2.4
2.4
2.1
1.8
1.5
3.8
4.8
4.5
2.7
0.3
1.8
1.7
1.9
0.9
0.2
0.5
0.3
1.0
0.3
1.2
1.0
0.5
5.9
3.0
3.3
5.6
2.5
5.9
4.0
1.7
3.6
1.8
1.3
1.5
0.8
0.9
1.7
1.7
1.1
10.2
5.5
5.8
9.0
8.0
9.7
7.9
4.4
6.7
5.4
4.5
4.2
2.2
3.0
2.6
2.5
2.1
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40
25
65
45
165
51
40
165
50
24
110
40
26
65
10
75
Sources: ABIQUIM, ANIQ, CEFIC, Statistics Canada, United Nations, American Chemistry Council estimates
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Top 25 Destinations for U.S. Chemical Industry
Direct Investment
Switzerland
740%
Ecuador
474%
Trinidad and Tobago
325%
United Kingdom
264%
SaudiArabia
253%
HongKong
246%
Netherlands
225%
Ireland
198%
Singapore
187%
Sweden
178%
Argentina
168%
Guatemala
154%
Austria
152%
Eastern Europe
143%
Finland
135%
Malaysia
109%
Taiwan
109%
Korea
105%
All countries
80%
CostaRica
77%
Germany
65%
Peru
62%
Brazil
61%
Canada
54%
Thailand
51%
Spain
48%
Mexico
47%
0%
100%
200%
300%
400%
500%
600%
700%
800%
% Growth in Direct Investment Position (1994-2000)
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World Employment in the Chemical Industry
thousands of people, 2001
Asia Pacific
4,975
49%
Western Europe
1,743
17%
North America
1,183
12%
Central/Eastern Europe
981
10%
Latin America
610
6%
Africa
365
4%
Middle East
210
2%
10,067
100%
Total World Employment
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Chemical Industry Sectoral Proposal
• Chemical Tariff Harmonization Agreement (CTHA)
– Voluntary agreement in Uruguay Round
– Reduce tariffs to 5.5% and 6.5%, some lines to 0
– 51 participants, including new EU members
– Pharmaceutical zero-for-zero
• Doha Round: Elimination of chemical tariffs
– Chemicals classified under HTS chapters 28-39
– Maximum flexibility in staging
• Non-tariff barriers
– Export taxes, import licensing, quotas, trigger price
mechanisms, discriminatory standards
– Regulatory divergence
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Chemical Industry Sectoral Proposal
• Country coverage
– Countries with a viable chemical industry
– Chemical production of $3 billion or more per year
• Product coverage
– HTS Chapters 28-39 with no exceptions
• Staging
– Current CTHA participants: 5 years
– Others
• Bind all unbound tariff lines
• Eliminate from bound rates
Tariff Level
25% or less
more than 25%
Time Frame
10 years
15 years
– Maximum flexibility for sensitive products
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Why Chemical Tariff Elimination?
• Tariff liberalization benefits chemical industries worldwide
– Due to the globalized and capital intensive nature of this sector,
chemical industries are globally competitive wherever they are
located.
– Competitive chemical industries rely on chemical inputs.
Countries with low chemical tariffs make themselves more
attractive for investment in the chemicals sector.
• Tariff liberalization benefits all sectors
– Chemicals are inputs into all manufacturing and agricultural
production. Lower chemical tariffs reduce input costs and prices
of intermediate and finished goods.
• Tariff liberalization supports economic development
– Improves access to products that can increase agricultural crop
yields and control animal and plant diseases.
– Improves the competitiveness of downstream producers in
domestic and foreign markets.
– Improves affordability of and access to consumer goods for more
people worldwide.
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Responsible Care®
• Voluntary chemical industry initiative
• Started in Canada in 1985 and now in 52 countries
• Commitment to continued improvement in all aspects of
health, safety and environmental performance and to open
communication
• Rigorous system of checklists, performance indicators and
verification procedures enables the industry to measure
improvement
• Industry associations implement initiative in their countries.
All programs are monitored and coordinated by ICCA.
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World Summit on Sustainable Development
August 2002
• Action Plan on Chemicals
– By 2020, chemicals used and produced in ways that lead to
minimization of significant adverse effects on human health
and the environment based on sound science, risk
assessment, and risk management
• ICCA supports the action plan through
– Responsible Care®
– Development of a global strategic approach to chemicals
management by 2005
– Implementation of a global system for the classification and
labelling of chemicals by 2008
– Participation in UN Environment Program (UNEP) and
International Forum on Chemical Safety (IFCS)
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ICCA is committed to meeting WSSD’s
sustainable development challenge
ICCA is making a significant contribution in these areas:
• Chemical safety: extending Responsible Care ®
• Innovation: developing new products and technologies
• Capacity building: improving knowledge about
chemicals through training, education and
communication and promoting health, safety and
environmental standards worldwide
• Globalization: transferring efficient technologies
throughout the world and improving education and
training
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