Fuelled by high commodity prices and government stimulus packages, GDP in Latam and the Caribbean grew by 6.9% in 2021. However, whether such growth was sustainable in the context of a myriad of macro challenges was questionable. As the year progressed, a surging US dollar and rising energy prices put pressure on the Latam chemical supply chain, increasing costs for a region dependent on raw material imports.

Despite the headwinds, trends such as the re-regionalization of production chains and the acceleration of the green agenda offer opportunities for a region with abundant natural resources, a large consumer market, and the world’s biggest economy in close proximity. To stimulate the investment necessary to capitalize on these opportunities, cooperation between the ‘pink tide’ of left-wing governments with the private sector is paramount. Braskem Idesa’s agreement with Pemex to construct the US$400 million Puerto Mexico Chemical Terminal in Veracruz in Mexico points to a path forward.

Encompassing each vertical in the chemical sector, the most notable theme apparent in this report is an industry-wide focus on sustainability. Where this used to be the realm of the large producers, now the full value chain is aligned with a push for greener products and carbon emission reduction.