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TWO QUESTIONS: DOES THE UK WANT A CHEMICAL INDUSTRY? AND IS IF SO IS THE UK A PLACE FOR THE INDUSTRY TO INVEST AND GROW? Dr Diana Montgomery Deputy Chief Executive, Chemical Industries Association The UK Chemical Industry • • • • £60 bn turn over £30m a day to the UK’s balance of payments Half a million jobs depend on the sector Products essential to everyday life and are needed to supply the rest of manufacturing • Integrated supply chains • Foreign headquartered so UK sites competing for investment • 80% of UK chemical production is exported – much to EU and US Creating Value: Summed up by Bob Lutz in his book “The Car Guy” ....... Economic value is created in 1 of 3 ways: • Mining materials from the Bowels of the earth • Growing food and wood from the surface of the earth • Manufacturing and distributing the products of the first 2. Energy intensive but environmentally efficient • Energy large part of chemical companies’ costs • UK chemical industry is 35 % more efficient since 1990 • McKinsey report shows industry overall climate change solution provider • Chemical industry products save at least twice as much CO2 emissions over their lifecycle as it costs to make them, • This could improve to 1:4.7 with the right policy framework Environmentally efficient Acidification Oxygen demand Environmental Burden in 2000 Environmental Burden in 2009 Photochemical ozone formation 0 Eutrophication 2010 goals Global warming Human health CIA Sustainable Development Programme • Sustainabiltiy programme across whole UK sector since 2004 • Publically reported indicators of performance annually • Committed to CIA Sustainable Development Principles. – Safe products and operations, – resource efficiency, – Innovation, – fairness, – respect for people and communities, – going beyond compliance, – openness – and leadership CIA Sustainable Development Programme Key Elements • Verification of Responsible Care • Implementation of the Global Product Strategy • Development of leading indicators in the areas of Health, Safety, Environment, Transport and Climate Change • Agreement of the methodology and data for carbon foot printing • Development meaningful economic indicators and tracking progress • Ensuring our workforce has the skills and ethical standards to deliver for their companies, customers and stakeholders • Public reporting of progress • Continuing to build our reputation for constructive, fact-based representation My evidence for why the UK needs a chemical industry • to deliver real financial value in the short and longer term • To create jobs both directly and through the supply chain. • To foster innovation in delivering solutions to global problems • And to do so with as little direct impact on the environment as possible...... How does the UK attract investment • A long term manufacturing strategy which provides certainty of government policy • Competitive and stable energy prices with security of supply • Proportionate and predictable regulatory framework pragmatically enforced • Competitive and stable tax regime • Solid skills base with flexible labour market • A Government that can package itself to the outside world as one who will welcome and facilitate new investment Conclusion • There are many reasons to be optimistic about the chemical industry in the UK. • We have innovative companies, great talents and increasingly a culture that once again respects people who make things. • There is evidence in our sector of UK companies being globally competitive • We are the industry that will produce answers to the environmental challenges we face. • If the Government can provide the right framework, the UK chemical industry will continue to lead the way through new industrial revolutions