Market Access Report: Chemicals

China's chemical imports grew a robust 23% during the first six months of China's WTO membership. China's insatiable demand for chemicals resulted in significant rises of 75% in fertilizer imports, and 9% in plastic imports over the same period.

With foreign direct investment increasing 12.7% in 2002, it comes as little surprise to see companies such as BASF, GE Plastics and Air Liquide strengthening strategic footholds in China to increase market share and boost sales. Many are investing in new chemical production facilities, acquiring Chinese competitors, establishing joint ventures with key Chinese industry players and setting up in one of China's integrated facility-sharing chemical parks.

Prior to the March 2002 revamping of China's Investment Catalogue for foreign investment, two chemical-related investment sectors were "prohibited", 10 were "restricted" and only 15 chemical and petrochemical-related investment categories were "encouraged". Now, no chemical-related investment sectors are "prohibited", "restricted" investment sectors remain at 10, and the number of "encouraged" chemical-related investment sectors has increased to 25.