Ineos chairman blasts European regulation

Sir Jim Ratcliffe, founder, chairman and 60% owner of Ineos, has written an open letter to European Commission President Jean-Claude Juncker, lambasting European chemical regulation in general and ‘green taxes’ in particular. These, he said, has been steadily driving investment away from Europe over many years.

This came a month after Ineos, the world’s largest privately owned chemicals company, announced that it would invest €3 billion to build a new ethane gas cracker and world-scale propane dehydrogenation unit at Antwerp, which is the first of its kind in Europe for 20 years. The company already has nine operations there.

A “well known CEO of a European chemicals company” had asked him “Are you quite mad?” shortly afterwards, Ratcliffe said. His answer to that was that Ineos could afford to invest in Europe because it can bring in cheap feedstocks and consumes them internally. No others are likely to follow suit.

“Nobody but nobody in my business seriously invests in Europe. They haven’t for a generation. Everyone in my business does, however, invest in the USA, Middle East or China, or indeed, all three. The USA is in the middle of a $200 billion spending spree on 333 new chemical plants. China has spent that sum annually for many years, constructing its own chemical building blocks.”

Europe, he continued, was formerly the world leader in chemicals, but its market share has halved from 30% to 15% in the past decade. “Europe is no longer competitive. It has the worlds most expensive energy and labour laws that are uninviting for employers. Worst of all, it has green taxes that, at best, can be described as foolish as they are having the opposite effect to how they were intended.”

As a result, he said, investment is going instead to the US and China and taking downstream manufacture with it. The US is now rebuilding its chemicals industry and replacing old units with new ones that have far lower emissions; it does not impose ‘green taxes’ but instead insists on “the very highest environmental standards before it issues permits for new builds”.

Europe, he concluded, retains an industry built generations ago with old environmental standards and has scared investment away, while America has welcomed new investment, created new jobs and improved environmental standards. “I know who looks smarter … Europe, reminds me somewhat of the Charge of the Light Brigade, immortalised in Tennyson’s wonderful poem, full of valour and good intention but the outcome will not be pretty.”