Boston, MA -- (ReleaseWire) -- 06/19/2014 -- The outlook for the Russian petrochemicals industry has changed markedly since the previous quarter due to the effects of tensions between Russia and the West over Ukraine on business and consumer confidence. The drive to import substitution in the Russian market will expose the industry to poor domestic demand, while the impact of the Ukraine crisis on tenuous European market growth will limit export opportunities. Domestic demand in Russia is likely to stagnate in 2014 and following a modest rebound in 2015 in growth, driven by subsiding geopolitical tensions, we reiterate our expectation for a deceleration in private consumption growth and subdued pace of fixed investment growth over the next few years.
Russia is also facing the threat of international sanctions over its involvement in Ukraine's domestic crisis with the government's foreign critics calling for the petrochemicals industry to be one of the economic sectors targeted. The desire for strong action is more prevalent in the US, while European powers will be reticent about taking actions that could cut many countries off from their main source of energy. One of the most pressing concerns in relation to Russia's external relations is risk aversion within the financial sector. Most of the credit approvals agreed by lenders before the Ukraine crisis have now expired for deals that did not complete. Western banks are reducing their exposure to the Russian syndicated loan market as a result of the Ukraine crisis, with some bankers fearing it could be 12 months before they can lend to Russian companies again.
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- Domestic demand in Russia is likely to stagnate in 2014 and following a modest rebound in 2015 in growth, driven by subsiding geopolitical tensions, we reiterate our expectation for a deceleration in private consumption growth and subdued pace of fixed investment growth over the next few years. We have revised down Russian real GDP growth from 2.0% to 1.0% in 2014, down from 3.4% in 2012.
The Russia Petrochemicals Report has been researched at source, and features Business Monitor International (BMI)'s market assessment and independent forecasts for key petrochemicals sub-sectors. The report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing companies by products and services, sales, market share, investments, projects, partners and expansion strategies.
BMI's Russia Petrochemicals Report provides industry professionals and strategists, sector analysts, trade associations and regulatory bodies with independent forecasts and competitive intelligence on the Russian petrochemicals industry.
- Benchmark BMI's independent petrochemicals industry forecasts to test other views - a key input for successful budgetary and planning in the Russian petrochemicals market.
- Target business opportunities and risks in the Russian petrochemicals sector through our reviews of latest industry trends, regulatory changes and major deals, projects and investments in Russia.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity).
BMI Industry View
Summary of BMI's key industry forecasts, views and trend analysis, covering petrochemicals markets, regulatory changes, major investments, projects and company developments.
Structure, size and value of the industry sector; overview of the industry landscape and key players; assessment of the business operating environment and the latest regulatory developments.
Business Environment Ratings
BMI's Petrochemicals Business Environment Ratings provide a country-comparative Risk-Reward Ratings index aimed at investors (both corporate and financial) in the regional petrochemicals market.
The ratings methodology makes sophisticated use of over 40 industry, economic and demographic data points and is part of BMI's integrated Country Risk-Industry Ratings products.
Industry Trends & Developments
Evaluation of company and sector-wide developments, including key projects (as well as expansion plans), latest company financial details and proposed international ventures.
BMI Industry Forecasts
Historic data series (2009-2012) and forecasts to end-2018 for all key industry and economic indicators supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:
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