Eye on Europe; European chemical sector: Industry in distress. (Global Watch).(Industry Overview)(Statistical Data Included)

Chemical Market Reporter, March, 2002 by Isaac, Colin

THE CHEMICAL industry is currently in a state of turmoil. As the global downturn persists, weak volumes, combined with high and volatile raw material prices, continue to depress profitability throughout the sector. Furthermore, competitive pressures have intensified, and a low-inflation environment and overcapacity in many products have tended to preclude price increases.

Additional problems have been caused by the spate of largely debt-funded acquisitions undertaken in the last five years. This has left many companies with highly leveraged balance sheets, and as the downturn has continued, the financial positions of many chemical companies in both the US and Europe have become increasingly uncertain. Dramatic measures have, in some cases, been necessary to...

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