GCC chemical producers to invest US$486M in environmental technologies by 2027 – GPCA

MIDDLE EAST – Chemical producers in the Gulf Cooperation Council (GCC) are stepping up sustainability investments, with an estimated US$486 million earmarked for environmental technologies through 2027, according to a new report by the Gulf Petrochemicals and Chemicals Association (GPCA).

The investments come as the sector works to balance operational efficiency with mounting global sustainability expectations.

Over the past decade, the GCC chemical industry has made notable strides, achieving an 11.7% reduction in CO₂ intensity, a 2% cut in greenhouse gas (GHG) emissions, and an 87.9% decrease in wastewater discharge, GPCA said.

Despite headwinds, the GCC chemical sector continues to perform strongly. In 2023, it reported capacity utilization at 93%, significantly higher than the global average of 75–81%, underscoring its operational resilience.

The industry also contributed 33% to total GCC manufacturing GDP and 4% to overall GDP, highlighting its role as a cornerstone of the region’s non-oil economy.

The GCC accounts for about 6% of global petrochemical production capacity, with nearly three-quarters of its output exported to international markets.

However, the sector faced a 9.3% decline in export volumes and a 27.7% drop in export values amid volatile global trade dynamics.

Even so, producers retained a competitive edge with an 8.3% cost reduction in ethylene production, while Saudi Arabia ranked ninth globally in chemical revenues.

On the workforce front, total employment in the sector grew by 18.8%, with a high 94% retention rate. Diversity also saw modest gains, with women’s participation rising to 4.1%.

Looking ahead, GPCA projects a US$6.5 billion R&D investment pipeline through 2028, though current R&D intensity (0.5%) lags behind the global average (0.8%).

Industry leaders are expected to priorities sustainable solutions, speciality chemicals, advanced recycling, and low-carbon production as key growth drivers.

Shifts in global trade patterns will also shape the industry’s trajectory. As Europe restructures its chemical markets and China’s influence grows, GCC producers are seeking deeper ties with Asian economies to secure long-term resilience.

“The choices made in the next few years will determine the industry’s position in an increasingly complex and sustainable global chemical market,” GPCA noted.

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