MEXICO CITY: Group of 20 nations are worried about a global downturn and want governments to do more to augment actions by central banks to revitalize the economy, Mexican Deputy Finance Minister Gerardo Rodriguez said yesterday.
Deputy finance ministers and central bankers of the G20, which comprises wealthy nations and leading emerging economies, concluded meetings in Mexico City yesterday ahead of a summit in November. Delegates said the global outlook had worsened since leaders met in June.
New measures to boost fragile economies from the Bank of Japan, the US Federal Reserve and the European Central Bank have helped to calm markets but were not enough, said Rodriguez, who spoke on the sidelines of the deputies' meeting, which he co-chaired.
Emerging market economies had not made a big issue at the meeting of a possible revival of "currency wars" following the new stimulus, he said, with more focus on economic woes.
"There's worry about the (economic) environment and there's a conviction that monetary policy by itself is not sufficient," Rodriguez told Reuters.
"It's good because the decisions of the ECB and the Fed have helped the stability of markets, but we need more government action."
"Currency wars" refers to the weakening of the US dollar and the strengthening of currencies of emerging economies, which makes their exports less competitive. The Fed's easier monetary policy has contributed to the dollar's weakening.
The Organization for Economic Cooperation and Development cut its growth forecasts for major developed economies earlier this month. The OECD said Europe was the main concern, but the United States also was at risk from future fiscal tightening.
G20 deputies urge govts to aid growth
G20 deputies urge govts to aid growth
SABIC sells European petrochemicals, engineering plastics units in $950m portfolio restructuring
RIYADH: Saudi Basic Industries Corp. is selling two overseas businesses for a combined $950 million as the world’s biggest petrochemicals maker continues to streamline its portfolio and redeploy capital toward higher-return segments.
The Riyadh-based company agreed to sell its European petrochemicals business to investment firm AEQUITA for $500 million and its engineering thermoplastics operations in the Americas and Europe to turnaround specialist Mutares for $450 million, SABIC said in a release.
The plastics deal includes an earn-out linked to future cash flow and a potential resale.
The transactions are part of SABIC’s portfolio optimization program launched in 2022, which has already seen divestments including Functional Forms, Hadeed and Alba. The company aims to sharpen its focus, improve returns, and free up capital for higher-growth opportunities.
Abdulrahman Al-Fageeh, CEO of SABIC, said: “This strategic approach allows us to actively reshape our portfolio and sharpen our focus on areas where SABIC has clear and sustainable competitive advantages in a rapidly changing landscape.”
He added: “I am pleased that both AEQUITA and Mutares will work with us in the future to ensure that we continue to serve our global customers in a seamless manner.”
The European petrochemicals business produces ethylene, propylene, various grades of polyethylene, polypropylene and polymer compounds. Its manufacturing footprint includes sites in the UK, the Netherlands, Germany and Belgium.
The engineering thermoplastics business in the Americas and Europe produces polycarbonate, polybutylene terephthalate and acrylonitrile butadiene styrene. Its facilities are located in the US, Mexico, Brazil, Spain and the Netherlands.
“The Board endeavored to achieve these transactions, which represent a significant milestone in the execution of our strategy to further optimize our portfolio and maximize shareholder value by enhancing the Company’s cash generation capacity and achieving the highest possible return on our global businesses,” said Khalid Al-Dabbagh, chairman of the board of directors of SABIC.
Chief Financial Officer Salah Al-Hareky said the transactions demonstrate a “disciplined approach” to capital allocation and active portfolio management, aimed at improving return on capital employed and free cash flow.
Despite the divestments, SABIC said it will maintain strategic market access through exports to Europe and the Americas, while preserving its focus on technology, innovation and customer service.
Both buyers have committed to ensuring business continuity, retaining workforce expertise and maintaining high safety and customer service standards during the transition.
Axel Geuer, president and co-CEO of AEQUITA, said: “This transaction represents a further step in the expansion of our European chemicals platform.”
He added: “The assets are highly synergistic with the olefins and polyolefins business we recently acquired from LYB; with complementary markets, infrastructure and operational capabilities, we see substantial potential to realize synergies and drive operational improvements across both businesses.”
Geuer, noted that under AEQUITA’s active ownership model, the focus will be on supporting the teams on the ground, ensuring a seamless integration, and building a scaled, competitive platform positioned for long-term, sustainable value creation.
Robin Laik, co-founder and CEO of MUTARES, said: “The Engineering Thermoplastics (ETP) business in the Americas and Europe has a highly skilled workforce and strong customer relationships.”
He added: “Under focused ownership, our priority is to ensure continuity, support employees through the transition, and unlock the full potential of our asset base as a standalone ETP platform.”
The deals are subject to customary closing conditions, regulatory approvals, and, where applicable, employee consultation processes.
