Despite recent economic challenges, the Asia-Pacific region will continue to drive growth in polyethylene (PE) demand, with Vietnam and India considered as bright spots in the market, according to the chairman of Vietnamese polyolefin distributor Stavian Chemical.
Stavian chair Tony Dinh also highlighted, in an exclusive interview on the sidelines of the 8th ICIS Asian Polyolefins Conference, that despite the changed dynamics that have emerged since the COVID-19 pandemic, China and Southeast Asia markets are still experiencing increased demand for plastic resins and plastic products.
"Despite being in different economic growth phases, these markets remain in a favorable condition to increase polymer and plastic consumption demand, not only in the consumer goods sector but also in engineering, healthcare, entertainment, and green lifestyle," Dinh told Reuters.
Against this backdrop, Vietnam's role as a low-cost manufacturing hub is predicted to expand significantly, aided by further expansion of existing key industry sectors, including textiles and electronics, as well as the creation of new industry sectors such as autos and petrochemicals.
"Vietnam is one of Southeast Asia's largest markets and an important manufacturing hub." And it has become increasingly internationalized in terms of petrochemical and polyolefin use," Dinh said. The Vietnam-EU Free Trade Agreement (EVFTA) will also help Vietnam, particularly in the petrochemicals and plastics sectors.
The EVFTA went into effect on August 1, 2020. It had been ratified by 16 EU member states as of the end of October 2023. Dinh believes that events like this year's ICIS Asian Polyolefins Conference, which was held in Vietnam for the first time, will help bring industry participants "closer to the market," given Vietnam's position as a major manufacturing base in Southeast Asia.
"I hope that ICIS and other international organizations will hold more and different conferences here." "I believe it will benefit many local industries and the economy," he continued. Stavian was the event's host sponsor, and it took place on November 7-8 in Ho Chi Minh City. Polyolefins are the most widely used plastic in the planet. According to the ICIS Supply and Demand Database, Vietnam is currently the leading market in Southeast Asia in terms of PE consumption.
The country is a duty-free import destination for PE of all sources, making it one of Southeast Asia's most competitive markets. Apart from Vietnam, Stavian expects India to experience considerable growth in the polyolefins industry in the next few years, supporting trade diversification away from mainland China, where demand has been struggling to revive in the post-pandemic era.
Stavian has extensively invested in its business in India in order to capitalize on the country's expansion. It opened an office in New Delhi in 2018, and another in Mumbai in 2022.