The chemical industry plays an important role in the European economy in terms of both GDP, providing employment and encouraging innovation. Of all key players, Spain has found a strategic position because of its geographical position, proper infrastructure, and a wide range of chemical commodities. In this blog, Spain’s role in European chemical industry is discussed in terms of the country’s economy, opportunities and threats it offers as well as its growth prospects.
Spain is one of the largest chemical producers in Europe and is only behind Germany, France, the Netherlands, and Italy. Spain’s chemical sector includes a broad spectrum of products, including:
Recent years have been positive for the development of the chemical industry in Spain with improved innovation, exports and environmental sustainability.
Chemical industry is one among the key industries of Spain and contributes nearly 3% to the country’s GDP. This fact underlines the position of the sector as being central to sustaining economic growth and prosperity. The chemical industry is among the most concentrated industrial sectors in Spain; the sector shows 6.1% of the national GDP and 5.5% of the active payroll population. Spain is the second largest exporter for the Spanish economy with a turnover of €82.493 billion that is earn 72.3% in foreign country and it earns the title of being the first industrial investor. 1
Chemical is also a major source of the employment opportunity; the industry directly employs about 300000 people and many others indirectly. The industry uses the skills of a qualified labour force whereby many of the specialists have attained a college degree in fields like chemistry and engineering. The focus on the research and development has generated many valuable employment opportunities beneficial to Spain in the European market.
Spain is considered to be a net exporter of chemicals; export of chemical sub-sectors seems to be greater than the import sub-sectors. About 70% of the country’s chemical production is exported to other European countries. Such a high level of export proves that Spain plays a significant role within the European supply chain to complete international market needs.
The location of Spain figuratively located across different continents; Europe, Africa, and the America that afford it strategic access to some of its major markets. The country has excellent infrastructure facilities such as major port, railway and road network through which the transport of goods can easily take place.
Today, Spain provides numerous facilities for research and development to chemical industries including Universities and research centers. Academic-industry relations have promoted partnership and thus allowed the evolution of Spanish companies to highest levels of product and technologies. The emphasis for spending on research and development has placed Spain with advantage in sectors like the pharmaceuticals and specialty chemicals.
When the European Union has called for a circular economy, the Spanish chemical industry has shown that it is ready to adapt to change for the betterment of environment. The companies are continuing and increasing their levels of attention to green chemistry, waste minimization, energy efficiency in compliance with EU directives and thus they gain competitive advantage.
Several challenges persist in the European chemical industry such as geopolitical risks, inflation, sustainability issues and disruptions to the chemical industry value chain. 2 Some of the challenges faced by Spanish chemical companies are: -
REACH is the Registration, Evaluation, Authorisation, and Restriction of Chemicals is one of the particular stringent regulation for the European chemical industry. As it is mentioned, such regulations are crucial for the human health and environmental benefits, however they can become the problem for the Spanish companies which are small and they have not enough resources.
The major problematic area is the competition that Spain is facing from other countries in Europe especially in the production of the basic chemical. Germany and the Netherlands have greater quantity production, as well as, have adoption of advanced technologies, hence the call for Spain to seek constant evolution in production. Nonetheless, Spain’s chemical industry has been able to overcome these challenges and sustain it competitiveness.
The chemical industry is influenced by changes in the global economy. Chemical businesses are sensitive to fluctuations in the market as recession can mean less chemical use and fewer jobs. When a calamity hits such as COVID-19, issues arise in terms of continuity and disruptions that requires resilience within the supply chain.
Industry development is also going to be influenced by the performance of developing adaptability to the market shifts and the industry’s focus on innovation and sustainability. In the future, the chemical industry of Spain will have a great potential with two major possibilities on the line.
The European chemical industry has a special focus on Spain, as it is a versatile country in terms of production capacity; has made a large contribution to the economy; and is also environmentally conscious. There are always problems, although significant opportunities for future development and dynamic growth can be observed in the field. Thus, the future of Spain as a country that can sustain prosperous development in the conditions of the European chemical industry will largely depend upon the further improvement of the country’s advantages and the overcoming of its drawbacks. The few challenges that the pharma industry faces today are mentioned and believed to be overcome in the future by joint cooperation, introducing new technologies and focusing on the sustainable development of this field.
• Spain - cefic.org
• Spain for Chemical Industry - Invest in Spain
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