BASF, Europe’s largest chemical concern, is moving production facilities from Germany to China due to political decisions that negatively affect the country’s economy, writes the German magazine Focus Online on May 22.
The author of the article points out that the closure of production in Europe and the direction of investments in China give a clear signal to politicians that companies are not willing to pay for the implementation of EU political guidelines.
One of the signs of this situation is the investment of 10 billion euros (980 billion rubles) in a new large plant in China, simultaneously with the closure of part of the production in Ludwigshafen, Germany. That is, the company hires new staff in China and says goodbye to part of the staff in Germany.
The reason for this transition is that it is no longer possible to make profits in Germany. BASF industrial base in the country “looks burned”, stands out in the publication. This is demonstrated by the 2023 financial report, when, apart from expenses, no results were obtained in Germany.
Furthermore, according to the Supervisory Board of BASF and its Board of Management, the situation will not change in the future.
Among the specific reasons that have created problems for the chemical giant are high energy prices compared to, for example, the United States or the Middle East, the growing bureaucracy in the country, social tariffs, the reduction of working hours and at the same time demanding higher wages, and lack of qualified workers.
Furthermore, the chemical industry is growing in China, which “It already represents 50% of the world’s total chemical market” with huge growth potential, while EU laws limit chemical companies in the range of products they produce.
“Politicians will one day pay a high price for this deliberate disregard for the economic interests of their companies and citizens, perhaps for democracy itself.””, summarizes the article.
Also read: EU’s prospects as an economic power remain bleak – Tagesschau
Source: Rossa Primavera
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