BASF CFO Dirk Elvermann also expects global markets to open following a possible victory for Donald Trump in the US presidential election in November. “We need a strong United States which, due to its importance, has a special responsibility for free trade and the global economy,” said Elvermann (52) in an interview with the dpa-AFX and dpa news agencies. “I hope whoever is elected can guarantee that in the end.” The world's largest chemical company is watching closely. “We will continue to secure, continue and expand our business in the United States.”
The United States is an extremely important market for BASF with more than 100 own locations and around 13,000 employees. Sales in the US exceeded 20 billion euros in 2022.
Experts fear that transatlantic relations could deteriorate significantly under a US president like Trump. In his first term, Trump dealt with Europe in a way that was less based on a common basis of values, said historian and political scientist Liana Fix of the Council on Foreign Relations, an independent think tank in Washington.
Growth rates in China are slowing
Overall, uncertainty in the world is increasing, Elvermann said. “This is, of course, a challenge for a company with a global presence,” which also applies to the chemical company's multi-billion-dollar investments in China. BASF also believes that growth rates in the giant country are currently slowing down. “But we take it into account when making our investment decisions. We do everything you can do to protect yourself if you invest heavily in the country. Of course, there remains residual risk, as with any foreign investment.”
Part of the security is that BASF manufactures in China for the local market. “That means we are not building an export location there, but rather a Chinese investment by China. This gives us some security when it comes to transport routes, logistics and sales.” Additionally, the group finances the entire business locally. “The idea that we are transferring funds from Europe or elsewhere to China is wrong.”
BASF assumes that around 80 percent of global growth in chemical production will be generated in China by 2030. “As a global chemical company, we want and must participate in this,” Elvermann said. The group is represented in China with 15 percent of sales and aims to reach around 20 percent by 2030. “We are traveling very appropriately.”
Just a few days ago, the group announced that it would sell its shares in two joint ventures in Korla, China. “Regular due diligence measures, including internal and external audits,” did not reveal any evidence of human rights violations in the joint ventures. However, the reports contained serious allegations pointing to activities “that are not compatible with BASF's values.”