The world looks to China in the field of chemicals; but where does China look?

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The global chemical industry looks to China, and China’s chemical industry looks to Shandong. Shandong Province is a major chemical industry province; in 1992, its chemical industry output surpassed that of Jiangsu for the first time, earning it the title of \"China’s leading chemical industry province.\" Since then, the total economic volume of Shandong’s chemical industry has ranked first in the country for 28 consecutive years. From the supply side, Shandong Province accounts for a large share of China’s chemical production, with output concentrated in traditional industries such as chlor-alkali, plastics, and fertilizers. From the demand side, Shandong is a strong province in the manufacturing of home appliances, automobiles, and gauze, all of which are major end-users for chemical products; thus, the chemical industry in Shandong enjoys natural market advantages. The chemical industry accounts for 13% of the assets in Shandong Province. Although supply-side reforms and strict environmental regulations have led to the elimination of a number of backward enterprises since 2017, resulting in a downward trend in the total assets of the chemical industry in Shandong Province, the three major sub-sectors of the chemical industry (the manufacturing of chemical raw materials and chemicals, the manufacturing of chemical fibers, and the manufacturing of rubber and plastic products) still account for 13% of the total assets. Among them, in 2019, the proportion of assets in the chemical raw materials and chemical products manufacturing sector was 10%, far exceeding that of other manufacturing sectors such as automobiles, general equipment, and coal mining. Shandong Province has a large number of chemical enterprises, but the number of employees in these industries is declining. Most chemical enterprises in Shandong Province are local companies, with a large proportion being small and medium-sized enterprises as well as private enterprises. Since the early 1990s, the various small-scale chemical enterprises in this region – those involved in oil refining, fertilizer production, chlor-alkali manufacturing, rubber processing, and coking – have continuously expanded their capacity and undergone upgrades, growing in size over time until they became the backbone of Shandong’s chemical industry. Among them, there have emerged large-scale refining and chemical enterprises with production capacities of tens of millions of tons, tire manufacturers that rank among the world’s top 50, and new types of coal chemical enterprises that have moved beyond fertilizer production to engage in the development of new chemical materials. According to **statistics bureau data, in 2017, the number of enterprises in the chemical raw materials and chemical products manufacturing sector in Shandong Province was 3,260, ranking first among all manufacturing sectors. At the same time, with the transition from old to new drivers of growth in the industrial sector and the further advancement of supply-side structural reforms, the number of chemical enterprises in the province has decreased in recent years, along with a reduction in the number of employees working in these industries.