INDUSTRY INSIGHTThought Leadership

From recovery to growth

Yousef Al Benyan, CEO and Vice Chairman, SABIC and Chairman, GPCA, discusses the challenges facing the chemical industry post-pandemic and the opportunities for growth in 2022

‘Redefine. Reshape. Reinvent’ is the new imperative for chemical companies today who need to transform for a future that is looking as uncertain and challenging as ever. What is your take on this new imperative and what do companies need to do today to be able to safeguard their business against future disruptions?

The pandemic has accelerated many important global trends which were already influencing our industry – including digitalization, trade dynamics and climate change. To keep pace, the chemical industry must transform itself to accommodate the new reality so that it quickly moves from recovery to growth.

The theme of this year’s Annual GPCA Forum – the three “Rs” – provides a conceptual framework for presenting our collective learnings from the experiences of the last two years. It offers a way for us to adapt our approaches to processes, technologies and people. The Forum will lay the foundation for our industry to become more resilient, agile and sustainable.

In 2021-2022 we are expecting to see the industry heading towards a recovery as a result of positive economic activity and increased demand for chemicals and petrochemicals. What is your view on the industry outlook in the coming year or so, and how will the current landscape impact the regional industry’s performance?

I see many reasons for optimism. Global economic growth rates in 2022 will likely normalize from the above trend rates that are characteristic of a “bounceback” from a sharp recession. Sustainable growth can still be achieved, however. Demand across our industry will remain healthy as global economies continue their recovery journey.

We also expect supply chain constraints to ease, leading to more moderate margins in our industry. And we have recently seen new plant capacity coming online for many key products.

As the Gulf region chemical industry continues to move beyond the pandemic, sustaining our growth will require us to be bold. We must capitalize upon new technologies and adopt business models that enhance efficiency, operational excellence and long-term resilience.


Alongside increased demand, disruptions around supply chain delays will likely persist, leading to an increase in cost, and adding pressure on margins. How is SABIC approaching these challenges and what can the chemical industry do as a whole to help abate future supply chain disruptions and trade challenges?

The global supply chain has encountered numerous challenges resulting from the pandemic and its associated impacts. Our industry has witnessed this in the shape of limited port operations, drops in schedule reliability, outages and container displacements. These challenges have led to volatile inventory levels and have impacted our collective delivery as well as cost performance.

At SABIC, we have adopted a global operating model with a regional focus through our five hubs – which are integrated by one supply chain network and one unified IT platform. This has given us the reliability needed to service our customers and meet their delivery requirements. All our products are supplied either directly or indirectly from our own well-established network of manufacturing and distribution sites.

We have also adopted a category sourcing strategy, which involves having multiple contracts in place with key suppliers. We have always focused upon building strategic relationships with our suppliers, and this is a major element of avoiding future disruptions.

How is SABIC planning to drive future growth in key international markets? What markets will you be focusing on in the short term and what are your plans for growth in these regions?

Alongside continued investment in our people and in safe and reliable assets, SABIC is targeting profitable long term organic and inorganic growth – all while maintaining strong capex discipline. To make this possible, we are leveraging our contributions to Saudi Arabia’s Vision 2030, expanding our asset footprint in the US and enhancing our presence in Asia and Europe. China meanwhile remains our industry’s biggest market.

With our strategic presence in regions where demand is growing, we are ideally positioned to help our customers meet that demand by incorporating our differentiated offerings and innovative solutions into their products.

We recognize also that the emerging circular carbon economy will create new long term opportunities. Alongside our carbon neutrality strategy, we recently announced an investment in our site in Teesside, UK, which will enable the chemical cracker there to be modernized so that its carbon intensity is lowered.

What is the significance of the recent launch of Saudi Arabia’s Green Initiative for the kingdom and the region and how is SABIC planning to support it?

The aspirational targets set by His Royal Highness at the Saudi Green Initiative (SGI) forum provide the foundation for a brighter, more sustainable future and place the kingdom in pole position to lead the new energy revolution.

SABIC’s global carbon neutrality strategy is aligned with the goals of the SGI. We shall continue to take bold actions that support the kingdom’s ambitions.

Our collaborative innovations are at the cutting edge of the circular carbon economy. We already operate the world’s largest CO2 capture and purification plant in Jubail and are now demonstrating how energy intensive industries can be transformed with renewable electricity. We are developing the world’s first large scale chemical site to operate fully on renewable power and, separately, developing solutions for electrically heated steam cracker furnaces which could reduce emissions by up to 90%.

Plastics recycling and circularity are important trends which have a significant and direct impact on the chemical industry not just in the region but globally. What is SABIC doing in this regard in terms of its product development and initiatives?

At SABIC, we believe plastic can be part of a sustainable future and we are taking action, working towards the collective aim of a circular plastics economy. We are collaborating with partners to find innovative solutions and new ways to design, produce, use and recycle plastic and close the loop on plastic waste.

SABIC was the first petrochemical company to commit to scaling up the advanced recycling of difficult to recycle, mixed and used plastic. We’re currently upscaling the production of circular polymers, part of our TRUCIRCLE™ portfolio and services, and will bring the world’s first commercial advanced recycling plant online in 2022 at Geleen, Netherlands.

In addition to the reuse benefits of circular polymers, they also play a part in driving the systemic change required to close the plastics loop. We have been working with strategic partners from across the value chain to demonstrate through pioneering pilot initiatives the circular potential of advanced recycling, but also what can be achieved when the entire value chain is engaged in a circular economy.

This year marks the 15-year anniversary since the establishment of GPCA. In light of this, what will be the role of the Association in facilitating sustainable regional industry growth in the coming years? What priorities and plans do you have in place to support GPCA’s member companies?

The petrochemical and chemical industries find themselves operating in a very different environment today than 15 years ago when GPCA was first established.

Both the industry, our members, and the Association have come a long way since then. Throughout this journey, GPCA has played an instrumental role in the regional chemical industry’s development, providing valuable advocacy, thought leadership and networking support.

Today, the challenges we face are more unpredictable than ever. Over the last year, we grappled with the consequences of a pandemic, the scale of which humanity has hardly ever seen; today we are faced with an urgent task: to take action on climate change, plastic waste and sustainability with decisiveness and a renewed sense of purpose and responsibility.

At GPCA we believe that the regional chemical industry can play a key role in addressing the challenges of today by innovating the solutions of tomorrow. Building on its success, GPCA will continue serving as an important platform for the exchange of knowledge and best practice, facilitating strategic dialogue across the chemical value chain, among industry and regulators, while advocating for a positive industry image.

The Association remains committed to abiding by its moto ‘Working for Our Members Through Our Members’, and it will continue to champion programs and initiatives that support the industry’s Environment, Social and Governance agenda, encourage talent development in the Arabian Gulf and enable a more sustainable future for all.