Mohamad al-Mady says raft of new initiatives needed for next phase of petrochemicals expansion
The CEO of Saudi Basic Industries Corporation (Sabic) has said plans to develop the second phase of the kingdoms downstream industry are much more complex than anything that has been attempted before.
Speaking at the Saudi Downstream 2014 conference held in Yanbu, Mohamad al-Mady told delegates the kingdom had built a world-leading petrochemicals industry before and that this could provide the model for new development.
However, he said much needed to be done to achieve the new plans for industrial diversification and proposed a series of reforms.
We need a stiff change in our approach to downstream; this is not an industry initiative, it is a national economic priority, said Al-Mady.
He suggested that a new entity needs to be established that has similar aims to the Royal Commission of Jubail & Yanbu (RCJY), in that it must be a dedicated task force that can push forward the new diversification programme.
He also called for improvements to existing infrastructure, the creation of free zones and increased financing options to encourage more businesses to set up operations in Saudi Arabia.
The kingdoms petrochemicals industry is the largest in the region and is worth $354bn, a third of the value of the Saudi Stock Exchange (Tadawul).
The industry has concentrated on producing intermediate chemicals that are aimed at the export market, but the new phase will concentrate on product slates that support Riyadhs drive to create wealth and employment opportunities for young Saudis.
This will include large anchor industries producing a diverse product range of chemicals that will be then used to feed industrial clusters with raw materials. The clusters include automotive, electrical equipment, plastics, renewable energy and metals.
Read more from Saudi Downstream 2014
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