China has experienced over two decades of high economic growth, which has been stimulated by the consecutive increases of industrial output, consumer consumption and capital investment. China's GDP has been growing at 9.8% per annum. National industry output has been advancing at 15% annually and will continue to sustain a strong growth into the next decade. The fast-growing middle class is creating an enormous consumer society. As the fastest-growing economy in the world, the emerging market has attracted the attention of investors and corporations around the world for the last two decades.
To deepen the reform of state-owned enterprises is a long-term task and needs great efforts. The reform of state-owned economy has witnessed rapid changes in both economic and social aspects. The introduction of foreign advanced technology and capitals will continue to be favored by the Chinese government and business community. New ways will be adopted to utilize foreign investment, including mergers, acquisition, and investment funds and securities investment. China will continue to improve its investment environment in the areas of legal system, intellectual property protection, foreign trade and investment regulation, infrastructure and financial system. China is the second largest foreign investment recipient after the United States in the world today. Given its vast market, the country provides tremendous opportunities for investment and trade both for the present and future.
China's nearly two-decade high economic growth has excited the rapidly rising consumption of thermoplastic elastomers. Since 1990, the country thermoplastic elastomers consumption has grown 23.8% annually. It is forecast that the Chinese automobiles, footwear, appliances, construction, industrial products, wire and cable industries will continue to fuel demand for thermoplastic elastomers and to lead the industry in growth. The total market demand for thermoplastic elastomers will increase 12.0% annually to 1,129,000 metric tons by the year 2009. In order to become less dependent on thermoplastic elastomers imports, China will continue to expand its production capacity. Output reached 405,000 metric tons in 2004 and will advance to 461,000 metric tons by 2005, increasing by 13.9% per annum. Despite of new facility construction and capacity expansions, China's thermoplastic elastomers demand will continue to outstrip supply. In 2004, China imported 287,000 metric tons, accounting for 46.4% of the total thermoplastic elastomers consumption. The country will remain a large importer of thermoplastic elastomers in next ten years.
Since 1950s, China has completed over 120 thermoplastic elastomers manufacturing facilities. Majority of these technologies and equipment were imported. Currently, the country is gearing up to add more new facilities to satisfy the surging domestic demand. More thermoplastic elastomers facilities are being constructed or scheduled to be built at the beginning of the century. In the past ten years, China's thermoplastic elastomers industry has been growing at 31.2% per annum. The Chinese government has given a high priority to the increase of thermoplastic elastomers production. In the past two decades, thermoplastic elastomers have been primary used in various industries. As the Chinese automobiles, footwear, appliances, construction, industrial products, wire and cable markets continue to expand; demand for new types of thermoplastic elastomers products has been rising. Demand for automobiles, footwear, construction, medical, wire and cable markets will offer the best growth opportunities. In China, major thermoplastic elastomers markets include automobiles, footwear, appliances, construction, industrial products, medical, adhesives, textile, coating and painting, wire and cable sectors. The automobiles, footwear, construction, wire and cable markets have been the driving forces to fuel the demand for thermoplastic elastomers.
Thermoplastic elastomers include styrenics (SBC), olefinics (TPO), polyurethane (TPU), polyesters (TPEE), polyamides (TPAE) and polyvinyl chloride (TPVC) etc. In China, there are more than 100 state owned, local government owned, private and foreign funded thermoplastic elastomers producers in 2004, including 55polyurethane, 220 styrenics, 114 olefinics, 6 polyesters, 10 other thermoplastic elastomers producers. The total capacity increases to 542,000 metric tons in 2004, among 67,000 metric tons of polyurethane, 271,000 metric tons of styrenics, 181,000 metric tons of olefinics, 7,000 metric tons of polyesters, 16,000 metric tons of other thermoplastic elastomers. In China, there are only 6 producers whose annual capacity of thermoplastic elastomers is over 10,000 metric tons, among them are 3 styrenics and 3 olefinics producers. The total capacity of these 6 producers is 215,000 metric tons per annum, and accounts for 59.7% of the total thermoplastic elastomers capacity in 2000. The majority of thermoplastic elastomers producers are small companies that manufacture thermoplastic elastomers products in China. Currently, the Chinese government is restructuring the industry. Many companies have formed alliances or merged into large chemical groups. Enterprise reform is reshaping the thermoplastic elastomers industry.
