Weekly actual topics (oct.17-21)

Analysis Materials 25 October 2011 10:20 (UTC +04:00)

Free economic zones receive cash boost

Foreign investors have been showing interest in creating free economic zones in Azerbaijan seeing it as the most important direction of expansion. The added bonus is these areas carry special incentive and benefits not applicable in other parts of the country.

A grant agreement was signed between the Azerbaijani government and the Agency for International Cooperation of Korea (KOICA) in Baku this week. This was under the banner of the Development of Special Economic Zones and Industrial Areas project in Azerbaijan with KOICA providing a $1 million grant to run over 18 months.

Korean companies have a lot of experience in developing special business and economic zones which will benefit Azerbaijan.

The main objectives of the project are to prepare strategies and policy to improve the development and management of industrial towns, to allot lands for industrial enterprises and to encourage the involvement of local and foreign investments.

The first industrial park in Sumgait was created in 2009. It was the first step to creating free economic zones in Azerbaijan. Sumgait's industrial site covering 46 hectares of which 14 hectares are industrial buildings, was the result of a state and business initiative.
The plants and production lines mainly manufacture products for the country's power industry and currently the industrial park's quality output is ready for export.

Another industrial chemical park will soon be built in Sumgait. Azerkimya production association plans to begin constructing a plant to produce carbamide and a dozen small mobile plants.

Whilst it is necessary to construct the out of city industrial towns in Azerbaijan, to protect tourism interests, industrial developments must not damage the environment. Turkey may be mentioned as a real example of this policy. Along with tourism, the industry became one of the first major export sectors after industrial towns were established.

Azerbaijan's key objective while creating an industrial town is to increase the competitiveness of the national economy and its effective integration into the global one, to ensure the duration of the dynamic socio-economic development in the long-term prospect by accelerating the development of the non-oil sector.

The establishment of industrial towns is also aimed at realization of state policy for the balanced development of regions, industrial entrepreneurship and its innovative direction.

ITGI project can face difficulties

The ITGI project (Turkey-Greece-Italy pipeline) is one of the three corridors that envisage the delivery of gas from the Azerbaijani Shah Deniz field to Europe, along with Nabucco and TAP. It includes updated Turkish pipeline infrastructure, as well as projects ITG (Interconnector Turkey-Greece) and IGI (Italy-Greece interconnector). The designed capacity of ITGI pipeline is 11.8 billion cubic meters per year.

Over the last year, experts' opinions on the chances of this project to be implemented were polar - from extremely negative to confidently optimistic. The European specialist on energy John Roberts: "ITGI is not likely to be chosen by Shah-Deniz Consortium as a preferable pipeline route to transport Azerbaijani gas to Europe. The project has too many problems". But the opinion of the head of Greece's DEPA Gary Sachinis is that "ITGI project is the best option for opening "Southern Gas Corridor".

All the arguments used up to now "for" or "against" the construction of this pipeline primarily touched upon technical and temporal aspects, and commercial attractiveness: "the pipeline is too small and has the least flexibility in terms of capacity expansion,... the negative feature of this project is that it consists of several parts. As long as the project contains a combination of several routes, its implementation is unlikely. "Or, for example: "the project has several advantages over other gas projects in the region and particularly envisages using the existing infrastructures of Georgia, Turkey and Greece. ITGI pipeline is the only pipeline amongst those proposed, which can be put into operation by the beginning of gas production within the second stage of the development of Shah Deniz gas condensate field in the Azerbaijan sector of the Caspian Sea".

However, the complexity in the project implementation may have an entirely different character. It should be noted that the ITGI shareholders are the Greek DEPA and Italy's Edison.

According to the European Central Bank President Jean-Claude Trichet, today, the financial system crisis faced by the European Union assumes a "systematic" character. The most critical situation is in Greece, which along with Italy, is part of PIIGS (Portugal, Ireland, Italy, Greece, Spain), indicating the zone of spread of the debt crisis. Today, Greece is on the verge of bankruptcy, Italy's sovereign credit rating was downgraded by international rating agencies to "negative".

At the EU summit in July, it was decided to establish a Stabilization Fund to provide the necessary resources to European economies with "problem", in particular, to cover part of the debts of Greece, and a few days ago, a plan was ratified to expand the lending capacity of the Fund, since the first infusion in the Greek economy has not brought the desired effect. According to Euronews, the European Commission insists on the total recapitalization of banks to prepare them for possible write-off of the Greek debts. Banks were actually offered to write off 21 percent of Greek debts, but Brussels unofficially speaks about 50 percent of restructuring.

In this situation, the ITGI shareholders may have difficulties in obtaining loans from the international financial institutions for the construction of a pipeline. It is not excluded that having assessed the financial viability of the two companies from countries with the highest risk of default in the eurozone, the IFIs will refuse to give them a loan. By the way, the state's share in DEPA is 65 percent.

With regards to financing the project through own assets of companies, then this is unlikely, considering the fact that the Greek government has put up DEPA for sale, trying to partially cover its huge national debt.

Big role of small business in Azerbaijan

Improving the mechanism of using the funds of the National Fund for Entrepreneurship Support (NFES) under the Economic Development Ministry of Azerbaijan will give an impetus to the development of small and medium enterprises in Azerbaijan, facilitating entrepreneurs' access to preferential financing.

Last week, Azerbaijani President signed an order on changes to the process of providing loans. This order became another step in the development of entrepreneurship in the country in terms of easy access of entrepreneurs to soft loans, funded by the state. Its main importance is that both the term and the amount of loans issued were increased. These changes will affect those loans that are issued from the date of entry into force of the Presidential order.

The basic problem of small business is to open business in the financial plan. This is the issue of starting capital which is not available for everyone wishing to open business. Bank percentages for the commercial activity are maximally high (more than 20 percent), but privilege credits in the National Fund are unfortunately sufficient not for all. All these, plus to inflationary development leads to the fact that developing small enterprise is considered a risky matter.

The practice of world business testified that the small enterprises take an important place in the national economy of any state. Indeed, in many respects it determines the rates of economic growth, structure and quality of gross national product. In the developed countries worldwide, the small and medium business (SME) has long ago been named the motor of the economy. In the budgets of these countries, significant share fell on SME. And, it is understandable that the governments of these countries in every possible way try to support and develop such enterprises.

The situation in Azerbaijan shows that the conditions created in the country due to political and macroeconomic stability to accelerate the development of small and medium businesses are not fully used. The number of those engaged in entrepreneurial activity below the existing capacity and share in GDP is within 10 percent, whereas in Europe the share of SMEs in GDP reaches 20-30 percent or higher.

Today Azerbaijan should develop production, make them competitive so that tomorrow when the borders are opened, Azerbaijani products could take solid niche in the commodity market of not only Azerbaijan, but also other countries. And certainly significant role in settling this problem belongs to the SME. We expect joining the World Trade Organization (WTO), after which Azerbaijani market will be completely opened for the foreign products. Most probably, the market will be full of imported goods, which will be more qualitative and cheaper, and Azerbaijani producers will not be able to compete with them. It means that Azerbaijan's economy will directly depend on foreign products.

LNG: Who will gain Black Sea First?

Deliveries of liquefied natural gas (LNG) in the past were considered economically viable only for remote markets (more than 3,000 kilometers), that is, to those where it was uneconomical to build the pipeline. The pipeline system delivering natural gas today also remains the dominant, covering 93 percent of the world's supply. But gradually the situation began to change. Over the last ten years, the volumes of world LNG trade have doubled.

The supply of Azerbaijani liquefied natural gas to Ukraine will amount to two billion cubic meters 2014, but a year later, these figures will increase to five billion cubic meters, Azerbaijani Ambassador to Ukraine Eynulla Madatli said yesterday in an interview with Ukrainian national news agency.

"In early 2011, in Davos, the two governments signed a memorandum on cooperation in organizing the supply of liquefied natural gas to Ukraine. We are very interested in this, I think Ukraine also. It deals with long-term loading of Ukrainian energy transport systems, transit fuel to other countries. This is a huge, highly profitable project, which has a bright future - for decades ahead," said Madatli.

The project involves the supply of gas, evaluation of infrastructure for delivery of gas from Baku to the Georgian coast, its liquefaction and supplies to Ukraine. A joint venture is planned to be established by the end of the year to finance and conduct a feasibility study for the supply of Azerbaijani liquefied natural gas to Ukraine. In addition, a Spanish company has won the tender to build LNG-terminal on the Ukrainian coast.

Until now, the Black Sea remains a virgin territory for the supply of LNG. None of the Black Sea countries has the infrastructure that would ensure the entire supply chain. It has not been previously demanded as gas transport systems in countries such as Ukraine, Romania, Bulgaria, were and still remain connected with Russian system. Transportation of LNG, for example, from Qatar or Algeria to the Black Sea is unreasonable, primarily because of the congestion of Turkish straits.

The struggle for markets continues. Not only Azerbaijan displays an interest in the Black Sea LNG market. Some time ago, Russian Prime Minister Vladimir Putin instructed to assess the possibility of building LNG-terminal on the Black Sea and calculate the cost of transporting liquefied natural gas to Europe under the South Stream project.

For reference, the financial costs in the global LNG supply chain are as follows - liquefaction 72 percent, marine transportation 15 percent, regasification 13 percent.

By 2015, in the world LNG trade, there will be six export markets and sixteen import markets. The number of LNG tankers in the world over the next three years will increase by 55 units and will reach 400 with a total capacity of 58.4 million cubic meters (after the liquefaction process at a temperature of -160 C, gas occupies a volume of 600 times smaller than its source).

While large national oil companies will continue to dominate in the global LNG industry, private companies will be leaders in the process of re-gasification. In the period from 2010 to 2015, over $140 billion will be invested in the construction of new enterprises to export LNG (data of LNGReports "Global LNG Trends Outlook and Business Prospects", January 2011).

Doing Business 2012: Azerbaijan goes up property ladder

Azerbaijan has improved its position in the Doing Business ranking as it moved from the 69th position in 2010 to 66th in 2011 for 'Ease of doing business' , the "Doing Business - 2012 In a more transparent world" , sponsored by the World Bank (WB) and the International Finance Corporation (IFC).

The annual report reads that Azerbaijan did not conduct any reforms on the viewed areas during the period between reviews. Also a new criteria was introduced since last year which is "Getting electricity".

Azerbaijan's rating on 'Starting business' was 18th position out of 183. Azerbaijan has been ranked 48th on 'Getting credit'; 24th on 'Protecting investors'; 81st on 'Paying taxes' and 25th on 'Enforcing contracts'.

It is also 170th on 'Trading across borders'; 172nd on 'Dealing with construction permits'; 95th on 'Resolving insolvency' and 173rd on 'Getting electricity'
Azerbaijan has entered the top 10 countries league with the most rapid process of registering property occupying ninth position. Based on the report, the time needed to register property in Azerbaijan is 11 days, the number of procedures that have to be passed is four and cost is only 0.2 per cent of the property value.

Innovation in the Azerbaijani legislation played a major role, as the country introduced new fees for expedited review and issuance of documents confirming property rights. The country has established a new unified register of real estate transactions which reduced the number of procedures to register property from seven to four. In addition, the State Registry was given the opportunity of accelerated passage of two of these four procedures that allows property to be registered in 11 days.

The procedure for obtaining building permits remains the most problematic area for Azerbaijan. This figure has a negative effect on the country's position and significant change has not been recorded in this area.

Companies must undergo 30 procedures over 212 days to obtain permission to build a property in Azerbaijan and the cost is a 335.2 per cent of per capita income. Based on the Azerbaijani State Statistics Committee, the nominal income per capita amounted to 2409.9 manat in January-September 2011.

In 2011, the country's position fell in five indicators. This ranged from falling three points on ' Starting a business'; 12 points on 'Dealing with construction permits'; two points on 'Getting credit'; four points on 'Protecting investors' and 7 points on "Liquidation of the company".

Azerbaijan showed its best results in terms of registering property, lifting by one position, taxation enjoyed a record 22 points, international trade is seven points and Enforcing contracts, two points.

In the new report, Armenia is ranked 55, improving its position by six stages. During the period between reviews Armenia conducted reforms in five areas; starting a business, obtaining building permits, getting credit, paying taxes, as well as the liquidation of companies.

Kazakhstan among the CIS countries occupies the first place rising to 47th place from 58th. This is followed by Armenia - 55 (61st in 2010), Azerbaijan - 66 (69 in 2010), Belarus - 69 (91 in 2010), Kyrgyzstan - 70 (67 in 2010 ), Ukraine - 152 (149in 2010 ) and Uzbekistan - 166 (164 in 2010).

However, Georgia leads the pack among the post-Soviet countries as it has managed to climb from 17th to 16th place in global rankings. Russia climbed four positions and is ranked 120, sitting between the Republic of Cape Verde (119th ) and Costa Rica (121).

Singapore, as well as other countries of the top five namely Hong Kong, New Zealand, USA and Denmark, held the top positions.

Southern Corridor is missing link in EU infrastructure

European Commission President Jose Manuel Barroso said at a press conference in Brussels on Wednesday that the EU is addressing important and difficult challenges such as the stability of the euro, tax discipline, structural reforms and support for European banks.

However, it should be absolutely clear, he said, that an important part of the EU's approach is to create conditions for developing and creating jobs.

"We primarily concentrate our efforts on the development to take the necessary steps to stimulate employment growth. Investment in a certain extent will help us achieve it," he said.

Barroso stated that the European Commission adopted an investment plan worth 50 billion euros to improve transport and energy infrastructure, as well as digital communications networks. These funds will be distributed as follows: 31.7 billion for upgrading transport and communications, 9.1 billion - for Trans-European energy projects and 9.2 billion - for the development of high-speed broadband information networks and Pan-European digital communications services.

However, the burden was not opening new job as a tactic target, but providing 'failing squads' in the overall infrastructure of the EU, whose absence impeded it to function as a unified body.

Barroso called North-South transport corridor from Helsinki to Valletta, railway from Portugal through Spain to Bordeaux, East-West Transport Corridor from Warsaw through Berlin to Rotterdam as an examples where the funds will be allocated. Speaking about energy projects, he said there is need to create 11 energy corridors, which would cover the whole territory of the EU, but mentioned two: "We are working on funding such projects as the "Southern Gas Corridor" and the network of wind power plants in the North Sea".

As Reuters reported, the EU plans to make these investments from 2014 to 2020, which covers the second phase of the Azerbaijani Shah Deniz field's development and the construction of the Nabucco gas pipeline worth 8-14 billion euro.

Once again, stressing the importance of the Southern Gas Corridor project for the EU, European leadership made one more practical step, backing their intentions with specific financial resources for its implementation.

Top 5 WB Social Projects in Azerbaijan

The World Bank (WB) plans to review the portfolio of projects implemented in Azerbaijan from Nov.4. The main goal of the bank is to achieve the desired results and accelerate the execution of projects, improve their quality. To this end, WB Regional Director on South Caucasus Asad Alam is expected to visit Baku, the WB Baku office said. The Bank last time reviewed its portfolio two years ago.

The Bank's current portfolio in Azerbaijan makes up 20 projects worth $2.3 billion covering investments in transport, water and sanitation, agriculture and irrigation and health and education.

The Health Sector Reform Project

The project is approved by the WB Board of Directors on June 29, 2006, and its implementation began in December 2006. The total project cost is $ 86.75 million, of which $ 50 million is allocated by the WB.

The project aims to improve overall health system stewardship and financing, and enhance equitable access to, and technical and perceived quality of essential healthcare services, in the selected districts in a fiscally responsible and sustainable manner with a view to improving health outcomes.

The project has the following components: will assist the Ministry of Health (MOH) to build its capacity in policy making, planning and regulation to design and introduce mechanisms, instruments and tools; will improve the quality, technical, and efficiency of health care services in five pilot districts ; will support health care financing reform in Azerbaijan; will ensure effective administration and implementation of the project by supporting the operation of a Project Implementation Unit in the MOH.
Education Sector Development Project

The total project cost is $ 45.4 million, of which $ 25 million is allocated by the WB. A loan agreement for which was signed in September 2008.

The Second Education Sector Development Project for Azerbaijan objectives of the second phase adaptable program lending are to achieve more effective teaching and improved learning results in general secondary schools.

The project components are following: supporting the implementation of the general education curriculum and further curriculum reforms is to successfully engage teachers, students, and education managers in the implementation of the new general education curriculum, and to develop new learning materials and school libraries; modernizing in-service teacher training will support the education reform by modernizing in-service teacher training systems and practices, etc.

The strategy of reforming the Azerbaijani education system is estimated at $250 million.

IDPs Economic Development Support Project (IDP EDSP)

In March 2008, the WB Board of Directors has allocated an extra credit for the IDP EDSP in the amount of $ 15 million through the International Development Association (IDA).

The objective of the Internally Displaced Persons Economic Development Support Project is to help improve in Azerbaijan living conditions of IDPs and enhance their economic opportunities and prospects for social integration.

The Additional Financing would also allow the Social Fund for the Development of IDPs to fund micro project of IDPs. Micro projects are carried out in the field of infrastructure and services sector to rebuild roads, electricity, water, construction and sub-artesian wells.
WB relates around 575,000 people or 15 percent of the population to IDPs indicating their needs in housing and services and lack of access to water and power supply, education and medical services.

Social Protection Development

The WB and Azerbaijan signed a loan agreement for the Social Protection Development Project worth $54.6 million in November 2008. The bank allocated $26.7 million to finance the project on IDA terms for 35 years with a grace period of 10 years and 0.75 percent per annum.

The objective of the Social Protection Development Project for Azerbaijan is to improve delivery of labor market and social protection interventions through strengthened institutions, enhanced institutional and human resources capacity, and improved targeting of social safety net programs.

There are four components to the project. The components aimed to a complete redesign of the labor market, including the improvement of labor laws, labor protection system, employment services, policy-welfare system, modernization of the pension system.
The project is planned for five years from the period of implementation from 2008 to 2013.

Second Water Supply and Sanitation Project In 2008, the WB and the Azerbaijani government signed an agreement on the allocation of $ 230 million loan through the International Bank for Reconstruction and Development (IBRD) and $ 30 million soft loan under the IDA to finance the Second Water Supply and Sanitation Project.

The objective of the project is to improve the availability, quality, reliability and sustainability of Water Supply and Sanitation (WSS) services in selected regional (rayon) centers in Azerbaijan.

The project covers 21 regions, five of which are located in the Nakhichivan Autonomous Republic, and the rest - Kurdamir, Ujar, Zardab and other areas.

The preliminary cost of the project of construction of deepwater sewage runoff from Hovsani aeration station into the Caspian Sea is 109 million, $ 92 million of which will be provided by the IBRD. According to the project, the station will be located 15 kilometers from the center of Baku.

How crisis affected wages in South Caucasus and Central Asia?

The global economic crisis had a significant impact on the wage growth in the world, the International Labour Organization (ILO) has come to such a conclusion in the 7th edition of its publication - Key Indicators of the Labour Market (KILM).

The wage growth has slowed significantly and was in the world (excluding China) less than 1 percent in 2008 and 2009. In 2006, the wages increased by an average of 2.7 percent, in 2007 - by 2.8 percent, and in 2008, wage growth in the world slowed by 1.5 percent and 1.6 percent in 2009.

At the same time, there are significant regional differences in wage growth. For example, in Asia and Latin America, wage growth has slowed, but remained positive, while in other regions such as Eastern Europe and Central Asia, wage growth has fallen sharply. In 2008, out of 28 economically developed countries, the value of real wages fell by twelve, and in 2009 - in seven countries.

In the post-Soviet countries, the situation with the growth of average wage during crisis and up to this day looks more relaxed as compared to European countries. Starting from 2007, in the South Caucasus and Central Asia, the growth is still recorded, but insignificantly. For example, the average salary in Azerbaijan rose from $272 (in 2007) to $440 in 2011, in Georgia - from $130 to $342, respectively, in Armenia - from $194.5 to $302, in Kazakhstan - from $340 to $602, in Uzbekistan from $200 to $326, in Turkmenistan - from $100 to $248, in Kyrgyzstan - from $86 to $160, in Tajikistan - from $66 to $106.

Thus, according to the CIS Statistical Committee, so far the lowest average wage in these countries was recorded in Tajikistan.

According to the European Statistics Institute, Eurostat, in 2011, in the EU, the residents of the UK receive more than everyone - 3,118 euros per month (gross). In addition, the Netherlands also was named in the list of countries where the average wage is more than 3,000 euros. Germany ranks the third - 2,980 euros. They are followed by the Danes - 2,947 euros. Belgians rank the fifth - 2,784 euros. They are followed by the Austrians (2,746 euros), Irish (2,639 euros), Swedes (2,576 euros) and French (2,462 euros).

South European countries - Italy, Spain, Greece and Portugal - are slightly below average. Wages, for example, in Italy total 2,344 euros, in Spain - 2,260 euros, while in Greece - 2,161 euros.

Less than 2,000 euros is earned by the Portuguese (1,712 euros), Poles (1,320 euros) and Hungary (1,213 euros). The list is completed by Romania and Bulgaria, where the average salary does not reach up to 1,000 euros - 880 and 688 euros respectively. As for the hourly payment, the difference between European countries is also significant.

The first place is occupied by the Danes (22.32 euros per hour) and the last - Bulgarians (4.71 euros per hour). Belgium ranked the second (21.8 euros per hour). According to the study, the Belgians in the average work six and a half hours per day. For comparison, the residents of the United Kingdom have to work longer because they get paid per hour an average of 17.75 euros (gross).

Petkim - future super complex worldwide

Oct. 25, Turkey will host the ceremony of laying the foundation of a refinery being built at the expense of Azerbaijani investments. A total of $5.5 billion will be invested in the project. The plant is scheduled to be commissioned in four years. Its operation will strengthen Azerbaijan's position in the energy market of Turkey, and at the same time, significantly reduce dependence on imports of final petrochemical products.

Azerbaijan is becoming a major foreign investor. Over $4 billion has already been invested in the Turkish economy and there are plans to increase investments to $6 billion in the coming years. A total of $1 billion has been invested in the economy of Georgia and it indicates how Azerbaijan is an important investor in Georgia, and was the recognition of SOCAR Energy Georgia as the largest investor and tax payer in this country. The list of external investments can be enlarged: construction of an oil terminal in Fujairah (UAE), creating a network of filling stations in Ukraine and Romania, the projects in tourism, retail trade, industry within the African, Latin American and Caribbean Fund (ALAC) created as part of the International Finance Corporation (IFC).

The largest and strategically most important foreign equity participation of Azerbaijan is the largest Turkish petrochemical complex Petkim, in which a joint venture SOCAR-Turcas (SOCAR - State Oil Company of Azerbaijan) has a 51-percent share.

Petkim shares are distributed as follows: SOCAR-Turcas - 51 percent, shares in free circulation (Istanbul Stock Exchange) - 38.68 percent, the Office for Privatization of the Government of Turkey - 10.32 percent. At the same time, Azerbaijan's share in the joint venture SOCAR-Turcas is 75 percent.

Rate of growth in demand for petrochemicals products in Turkey, especially for products made of thermoplastics, at least twice exceeds the world average, while per capita consumption in Turkey is much lower than in developed countries.

The consumption of plastic products per capita

Kg/per capita





Western Europe



In world
























Source: Petkim petrochemical holding corp. Investor presentation June 2011

Exactly the rapid growth in demand for petrochemical products in the domestic market of Turkey served the decision of Azerbaijan to make a substantial investment in the development of complex, especially the construction of the refinery.

After the refinery is put into operation, Petkim will have a stable volume of starting material (oil products) for the production of chemical products, 70-75 percent of which Turkey imports. Investments will reduce imports by 30 percent. The new refinery will produce up to 2 million tons of naphtha per year, 90 percent of which is now imported by Petkim. The refinery will also produce LPG (liquefied petroleum gas), diesel and aviation kerosene. The straight-run gasoline and fuel oil after hydrocracking will be supplied for the production of chemical products, and diesel fuel, aviation kerosene and other energy resources will be sold in the markets of Turkey and Europe. Processing capacity is 10 million tons of crude oil per year.

This year, Fitch Ratings revised its rating outlook for Petkim, changing it from "negative" to "stable". The agency's report said the Petkim's capacity to use growth potential in the Turkish petrochemical market is currently limited by its production and investment potential and depends on the realization of project by Socar/Turcas.

The strategic plan Petkim, according to CEO of company SOCAR / Turcas Kenan Yavuz was the creation of the cluster model and its transformation into a petro-chemical and energy superkompleks global industrial zone along the lines of Jurong Island in Singapore.

The general director of group of companies SOCAR/Turcas, Kenan Yavuz, said that the plans of holding is to double the capacity by 2018 and increase the share in the domestic market to 40 percent. The strategic plan of the holding includes the creation of the cluster model and its transformation into a petro-chemical and energy super-complex of global scale like industrial zone Jurong Island in Singapore.

About Petkim Holding: is the only producer of petrochemicals in the country, with domestic market share of 25-26 percent, sales worth $1.870 billion in 2010, number of employees - 2,500 people. In addition to the raw material for polymer fibers (terephthalic acid, ethylene glycol, acrylonitrile), thermoplastics (polyethylene, PVC, polypropylene), benzene and other raw materials, the company produces several types of finished products: plastic packaging, textiles, detergents, cosmetics and other products. Petkim has 15 main production facilities, and 8 subsidiary. In 2010, production totaled 3.2 million tons - a record figure for the last 45 years. Petkim exports products to 60 countries. Major competitors are BASF SE, Saudi Basic Industries Corporation, Shell Chemicals Limited.