2010 FIFA World Cup infrastructure drive SA chemicals market
PANA

 Despite the economic turmoil of 2009 and its pr ofound impact on the global chemicals industry, South Africaâ?s chemicals markets remained fairly robust, thanks to significant investments in infrastructure leading up to the 2010 FIFA World Cup, according t o international Growth Partnership Company Frost & Sullivan.

Following the economic turmoil, demand for chemicals fell off sharply as end-use rs came to terms with low consumer confidence and declining purchasing power.

However, Frost & Sullivan said Monday in an analysis of the South African chemic als industry that markets remained fairly robust last year, and so far, a total of R11.92 billion had been spent towards stadium constructio n alone, and suppliers of construction chemicals have benefited from this spending.

â?Government spending leading up to the World Cup has buffered the local econom y from the demand concerns facing the global market,â? noted Frost & Sullivan chemicals programme manager Mani James.

â?The construction sector performed well through the recession and was growing at just over 10 percent last year. However, demand from other end-user groups, including the agriculture, mining and consumer sectors, is stil l under pressure,â? he added.

James noted that the last few months leading up to the World Cup would see the f inal drive in infrastructure preparations.

As this activity subsides in the second half of 2010, he said the economy was ex pected to slow and that would be the major challenge facing local industries.

However, transportation, water works and electricity infrastructural projects co ntinuing over the next two to three years will provide opportunities.

â?The local automotive industry is also expected to return to a growth cycle fo r the first time in three years, albeit at a slow rate,â? James added. â?This will present opportunities for automotive suppliers including platinum producers , plastics manufacturers and all associated consumable materials suppliers.â?

Palladium has also become pegged as a valuable investment opportunity as an affo rdable substitute for platinum in automobile production. This might present opportunities for chemicals companies to target the expected growth amon gst palladium miners.

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