Massive chemical emergency in East Germany since 1991, impacting thousands of employment opportunities
In Eastern Germany, the chemical industry is grappling with a severe crisis, facing immense pressure due to structural challenges, high energy costs, excessive bureaucracy, and external factors such as Donald Trump's trade policy.
Nora Schmidt-Kesseler, managing director of the North East regional association, has been vocal about the industry's plight. She demands economic growth, courage, and a positive spirit of renewal, emphasizing the need for reliable energy prices, investment security, and less regulation, as well as immediate revision of energy costs and regulation.
Schmidt-Kesseler believes a spectacular comeback for the Eastern German chemical industry is necessary and possible, while InfraLeuna, an operational chemical site in Saxony-Anhalt, agrees that quick and decisive action is required, even if it means taking unpopular steps.
The chemical industry, a significant pillar of the Eastern German economy, is currently experiencing its weakest state in over 30 years. Capacity utilization reached 71.7% in Q2, the lowest since 1991. Around 500 jobs are at risk due to the planned Dow closures in Schkopau and Bohlen.
Große Entrup, the CEO of InfraLeuna, has warned that the industry has not been profitably utilized for four years, and bankruptcies are increasing, leading to job losses. He emphasizes that the location crisis can't be solved with words alone, only with swift action.
The federal government has recently announced initial steps to reduce electricity tax, but there's been no noticeable impact yet. Politics in East Germany have not implemented specific crisis-solving measures targeted solely at the chemical industry so far, but the federal government is facilitating CO₂ storage legislation to support industries and accelerate project approvals, which may indirectly benefit chemical production.
However, current measures to address the chemical industry's crisis in East Germany remain limited amid a severe production slump and looming job losses. Eastern German entrepreneurs have criticized the Merz government, stating that their actions are unbearable.
A spokesman for InfraLeuna GmbH has criticized the framework conditions in Germany, stating that investments are being put on hold due to high energy costs and excessive bureaucracy. The CEO of InfraLeuna has expressed that Russian gas was never cheap, in response to discussions about returning to Russian gas.
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The conclusion is clear: Especially in East Germany, the chemical industry stands at a crossroads. Without decreasing costs and less bureaucracy, there won't be investments - and without investments, there won't be a future for the chemical industry. Große Entrup did not specify any unpopular steps that might be necessary for the turnaround of the chemical industry, but the call for action and reform is resounding.
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