PROMOTING EUROPEAN CHEMICAL CLUSTERS

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PROMOTING EUROPEAN CHEMICAL CLUSTERS
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CHEMICAL INDUSTRY TODAY

• A GLOBAL industry, sales over 1000 bn
• UK ranks 6, sales 34 bn
• Growth rate around 2.5 pa - similar to OECD
  chems, UK GDP faster than UK manufacturing
• Big trade surplus of 5 bn
• Employs 240,000
• Companies juggling portfolios, many trying to
  move to specialities

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THE UK POSITION- STRENGTHS AND WEAKNESSES

• Feedstocks, energy
• Logistics
• Human resources, skills
• Engineering, services
• Company ownership RD, capital inv.
• Political/regulatory environment

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PROMOTING EUROPEAN CHEMICAL CLUSTERS

• HOW DO THEY DO IT?

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LOCATIONS SURVEYED

• Netherlands
• Rotterdam, North Netherlands
• Belgium
• Antwerp
• France
• Nord-Pas de Calais, Lacq, Marseilles
• Germany
• Bitterfeld, Leuna, Ruhr
• Spain
• Tarragona

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ROTTERDAM

• Rotterdam Municipal Port Management is key
  authority
• Proactive development of infrastructure,
  services offers one-stop shop, controls all
  necessary levers
• Case rests on logistics and inherent cluster
  strength
• No mention of financial inducements (But
  Netherlands has business friendly tax structure)

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NORTH NETHERLANDS

• Delfzijl (chloralkali etc) and Emmen (plastics)
  promoted by NV NOM (RDA)
• Relies more on special assistance works up
  business plans, may take equity, offer soft loans
• Subsidies for SMEs with smaller projects detailed
  (max 20 capex) larger projects may qualify
  after review

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ANTWERP

• Port Authority in charge (shared control of left
  bank of Scheldt)
• Has actively developed infrastructure
• One-stop shop controls development
• Acts as estate agent for spare plots
• Case rests on inherent strength of cluster and
  position
• No financial lollipops

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NORD-PAS DE CALAIS

• Hierarchical state/region/municipality support
  system national champion companies (esp
  utilities) participate
• Many financial incentives
• State, regional subsidies
• Redeployment funds from companies
• Tax exemptions, subsidised premises
• Sector expertise at regional level, towns handle
  individual sites. Chambers of Commerce actively
  involved
• EUs INTERREG an extra dimension

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LACQ (Pyrénées-Atlantiques)

• Based round gas field, now centre of sulphur
  chemistry
• Key feature is SOBEGI set up, funded by Elf, now
  operates on non-profit basis
• utilities, key materials, waste treatment etc
• offers operating, accounts secretarial staff
• can handle logistics, etc
• also acts as one-stop shop for investors
• Chemparc the new branded public face
• Strong on financial incentives (as NPdeC)

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MARSEILLES

• Relatively low key promotion appears to be in
  hands of Provence Region. Port a big logistical
  plus, but not involved as an agency
• Offer guidance with whole relocation process
• Financial incentives not prominent, but fully
  serviced sites available

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GERMANY - EAST

• Supported by special agency, the Industrial
  Investment Council, in Berlin
• Chemicals in Sachsen-Anhalt triangle could be
  called a single cluster, but individual locations
  separately promoted
• Always important chemicals area clean-up costs
  from public funds privatisation agency sold
  assets very cheaply

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GERMANY - BITTERFELD

• Marketed by ChemiePark, the original clean-up
  organisation
• Continues as privatised services provider and
  one-stop shop for investors. Aims still appear
  aligned with regional government
• Draws support from IIC
• Well placed for C European markets
• Land still cheap - technically brownfield, but
  restored to reconstructed greenfield quality
• Very generous grants specified.

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GERMANY - LEUNA

• Similar stance to Bitterfeld
• Ready to build plots available cheap services
  strategic geographical position
• Same high level of grants, cheap loan facilities
  support from S-A and IIC
• Dow has its own ValuePark at Schkopau has so
  far attracted mostly plastics processors, plus
  EVC

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GERMANY - RUHR

• Originated with Hüls at Marl
• Now with NRW region backing, 4 sites
• Collectively marketed as ChemSite, the most
  comprehensive and professional Internet offering
• Appears to have very generous own resources
• Offer based on we do it all through site
  services companies more coy on financial
  incentives.

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TARRAGONA

• Main agency is Catalonia govt FIA
• Stresses Barcelonas advantages in logistics,
  growth, relative cheapness, pleasant climate and
  quality of life (not chemicals specific)
• Chemicals cluster has own management
  association, which successfully secured funding
  for pipeline connections to port
• Growth coming from expansion by those already
  there.

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COMMON THREADS

• Access to significant public sector resources
• Promotional agency often doubles as on-site
  services company
• One-stop shop able to handle all aspects
• Business tenants actively involved
• Precise delineation of sites available
• Grant structures, whenever a relevant issue,
  clearly laid out

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SO WHAT CAN WE DO?

• Read the EY Michigan case study for good
  pointers on strategy
• Give our agencies clout and access to resources
  agree who does what
• Beef up details of site availability, etc
• Try to strengthen local services provision
• Make agencies one-stop shops