RIYADH, 24 November 2006 — The Saudi Arabian General Investment Authority (SAGIA) is planning to set up a plastics manufacturing section at the SR100-billion King Abdullah Economic City (KAEC) at Rabigh as part of the Kingdom’s drive to position itself strongly in the global plastic industry.
According to SAGIA Gov. Amr Al-Dabbagh, the so-called Plastic Valley Project will be implemented in collaboration with the Saudi Plastic Producers Forum, which was convened by SAGIA to raise the profile of the plastics industry.
The project will make available the infrastructure needed for the production of plastics, a secondary petrochemical. Mohammad Al-Mady, vice president and CEO of Saudi Basic Industries Corporation (SABIC), was among those who attended the forum’s session.
“This will be a major boost for plastic manufacturers as it will increase Saudi Arabia’s stake in the global plastic market substantially in the near future,” he said.
The forum discussed the outcome of studies carried out by a global consultancy team on the scope for upgrading the plastic industry. Currently, the Kingdom, which accounts for one percent of plastic production in the global market, hopes to raise it to at least 15 percent by 2020.
In another development, SABIC anticipates that planned investment in capacity expansion will rise to about $25 billion over the next five years.
Al-Mady said that their production capacity will rise to 130 million tons per year by 2020 from 47 million tons last year due to expansion, while the number of employees will exceed 25,000. He said the real GDP growth rate, which stood at around 5.8 percent this year, could decrease to five percent by 2009.
He added that if petrochemicals are substituted by ethylene, the Middle East could account for half the production capacity in the next five years.
