Chemicals Industry Sees Slower Growth

Chemical makers in Germany continued to enjoy buoyant demand for their products in the fourth quarter of last year, but growth was expected to lose momentum this year as exports slowed, the VCI industry federation said on Thursday. After a very positive third quarter of 2004, "growth continued in the fourth quarter," with output rising by 4.2 percent and sales up 2.7 percent, VCI wrote in its latest quarterly report. Demand for German-made chemicals was strong both at home and abroad in the period from October to December. Sales within Germany rose by 1.3 percent to 17.1 billion euros ($22.9 billion) and exports sales advanced by 4.1 percent to 19.3 billion euros. Nevertheless, after a solid start to 2005, growth was expected to tail off in the latter part of the year, VCI said. "Export growth is gradually losing momentum and domestic business will not be able to make up for that," the report wrote. Sales growth had already slowed slightly in China and in Southeast Asia, even if the two regions would remain the primary growth engine for the German chemicals sector, VCI said. "High oil prices, the weak dollar and the gradual cooling of the global economy are weighing on expectations," it said.