Meeting #

Meeting - Y2019

GPCA International Trade Committee

2nd May 2019

10:30 – 15:00

1

38

2

GPCA Offices,

Business Bay, Dubai, UAE

Meeting OpeningChairman

2

Sulaiman Y. Alabdulsalam, PIC

28 years experience in Aromatics, Olefins and Fertilizers. Expertise in Marketing and Supply Chain. Member of various boards and committees.

Board Membership:

• Kuwait Paraxylene Production Company (KPPC): Member since Jun 2016

• Kuwait Petrochemical Industries Company (KPIC) Member since Sep 2018

• Kuwait Vietnam Petrochemical Company (KVPC): From Dec 2017-Sep 2018

• Equate Marketing Company ( EMC ): Member since Mar 2019

Experience:

• Aromatics Field (Paraxylene), PIC: 2018 – Present

• Olefins Field (Polypropylene), PIC: 2004 – 2013 & 2017 - 2018

• Fertilizers Field, PIC: 1997 – 2004 & 2013 - 2017

• Insulation Field, KIMMCO: 1991 - 1997

Education:

• MBA, Kuwait Maastricht Business School (2008)

• B.Sc. in Industrial Engineering, University of Alabama, USA (1990)3Marketing Manager - Aromatics

Attendance Review

4

Total 11

Quorum needed 7

Confirmed 7

Tentative 1

Regret 3

No response 1

# Member Organisation Confirmation

1 Mutlaq Al-Morished Tasnee Confirmed

2 Ahmad Al Saleh Equate Confirmed

3 Abdulrahman Essa Al Ateek Borouge Confirmed

4 Khalid S. Alohali Ma’aden Regret

5 Georgina Campbell Fyffe Integra Tentative

6 Hassan Musa Al-Mahmoud Muntajat Regret

7 Faisal Al-Hajri Orpic Confirmed

8 Sulaiman Alabdulsalam PIC Confirmed

9 Azhari Mohd Kalok QAFCO Regret

10 Mathad Al-Ajmi SABIC Confirmed

11 Abdullah Al-Thowaini Tasnee Awaiting response

12 Yasser Fattah NATPET Confirmed

Do Don’t

Ensure strict compliance to the following steps to minimize the risk of violating competition laws

Prior to meetings:

• Draft detailed agenda that accurately reflects what is to be discussed. Agenda and meeting documents must not include issues relevant to competition law

During meetings:

• Limit discussions to topics included on the agenda• Take minutes of the full meeting• In case of spontaneous statements relevant to

competition law, react immediately and actively dissociate yourself from the violation:

o Point out to participants that this issue must not be discussed

o If necessary, postpone the discussion until you have received relevant legal clarifications

o If the discussion continues, notify your objection in the protocol, suspend the meeting or leave the meeting space

o Inform the GPCA Secretary-General or your company about the incident

After meetings:

• Minutes of meetings should be short and straightforward

Discuss, formally and informally, exchange information

about or reach agreement with competitors about:

Prices:

• Pricing, price differentials, and pricing strategies

• Individual sales and payment terms, individual discount, credits and credits conditions

Production:

• Production capacity, design plans, production rates, production methods and proposed changes thereto

Transportation:

• Rates or rate policies for shipments, including zone prices and freight charges

Future Market Behavior, in particular:

• Plans of individual companies concerning technology, investment, design, production, distribution and marketing of certain products

• Agreement on market allocation either geographically or by costumers

• Matters related to actual or potential suppliers or customers, particularly if this might have the effect of excluding them from any market or influencing the business conduct of other companies toward them

Meeting Protocol

5

Agenda

6

# Agenda Item Objective Time Presented byPre-reading required?

1

Meeting opening & administration• Attendance review • Agenda review• Introduction of new member• Action items review

• Opening • Alignment

1030 – 1040Chairman &

Sec. Gen. -

2FTA White Paper• Action plan development

• Review• Alignment

1040 – 1130 All Yes

3Masterclass & Workshop on Trade Defence Strategies

• Review• Alignment

1130 – 1200 All Yes

4

Presentation: • Brexit and its possible consequences

for GCC exports • On-going FTA negotiations

• Discussion 1200 – 1245 Charles Julien -

Prayers & Lunch 1245 – 1315

5 EU Duties on Fertilizers • Update 1330 – 1350 Udit Arora -

6 Basel Convention – Proposed changes • Update 1350 – 1410 Udit Arora -

7 WTO Public Forum – Way Forward • Alignment 1410 – 1440 Yaser Fattah Yes

8 Close of Meeting• Closing• Alignment

1440 - 1450 Chairman -

FTA White PaperAll

7

Masterclass & WS on Trade Defense StrategiesUdit Arora

8

Brexit and its possible consequences for GCC exports Charles Julien

9

On-going FTA negotiationsCharles Julien

10

EU Duties on FertilizersUdit Arora

11

Introduction

12

EU – an important market for GCC fertilizer producers:

• Accounting for 25% Ammonia, 14% Urea and 15% DAP/ MAP of global imports

• Local industry rationalization → growing imports

• Vs. Asia and S. America, GCC products offer climate and currency stability

Hurting competitiveness of GCC producers:

• 6.5% import duty on Urea and DAP, 5.5% on Ammonia

• Most GCC competitors (MENA, Caribbean and Ukraine) have preferential access

• Current customs duties on a 40kt urea shipment → ~USD 1m

On behalf of the 7 producers, GPCA hired CVA and their partners ESL Network

Introduction

13

EU Duty reductions:

• Recurrent topic at EU level, dependent on product criticality and potential benefits for the overall economy. Duties suspended for >150 products in Jan’16

• Since the formation of the CCT (1987), duties for fertilizers have been reduced several times, following a product-specific approach

• EU fertilizers industry has been through a period of consolidation and rationalization

• At the same time, farmers’ competitiveness is at the forefront of the political and social agenda

• Favourable indicators – GCC: Aluminum (2007); Methanol & LLDPE (2016)Russia: MOP (2011)

4 potential paths to duty reduction

14

CVA Recommendations

15

Stakeholder mapping

16

ABEAN

17

Members are European stakeholders

representing:

• 700 blenders and complex

fertiliser plants

• 3,000 fertiliser distributors and

cooperatives

• 1,000,000 farmers

• Logistics operators working with

over 10 different European ports

Technical Path - 2017

18

EU-based

approach

Focus on

raw

materials

Product-

specific

approach

Basel Convention – Proposed ChangesUdit Arora

19

WTO Public Forum – Way ForwardYaser Fattah

20

Background

21

During 2018, the ICCA has organized a series of industry-specific meetings where a

number of delegations advocating the chemical industry’s key messages derived

from industry priorities, i.e. (i) regulatory cooperation, and (ii) tariff elimination.

The dialogue has established advises that can create opportunities for the global

chemical industry. for e.g., ICCA can lead on regulatory cooperation best practices

at WTO and partner with the ITC (International Trade Centre) and UN think tanks in

2019.

Some delegations in Geneva have instructed ICCA to explain to WTO members why

tariff elimination would be important for reaching a variety of objectives to both

industry and society. Note: US and China must agree for others to follow.

Way Forward

22

GPCA ITC priorities

The ITC has the following long standing priorities:

(1)tariff elimination

(2)elimination non-tariff barriers

Engagement

Identify Geneva-based WTO missions, and other trade related groups to meet and explain why tariff elimination is important, and seek their guidance on the way forward

Actions

1. To develop the case (why tariff elimination is important for industry and society)

2. Request WTO a speaking panel (if possible)

3. List potential missions and groups we’re interested to meet and start arranging meetings with them

Close of MeetingChairman

23

Calendar 2019 - Proposal

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• March 10, Sunday, Dubai

• May 2, Thu, Muscat

• October 17, Thu, Kuwait/ Muscat