The end of 2007 heralds a new 2008 with newer aspirations and hopes. 2008 begins on a somber note due to a somewhat trepidation of a weaker economy arising from recession that may set in the USA, which would trigger some downfall in the global economic scenario. Global GDP growth rate in 2007 is estimated around 5.2%, at almost the same rate (5.3%) witnessed in 2006. This is possible because of about 7.5% growth in Asia mainly due to robust economies of China and India. In 2007, China is estimated to show an excellent economic growth of almost 11% while India would show 8.9%. The emerging economies of Brazil, India and Russia have successfully overtaken economic growth rate of USA and are currently leading global economic growth. The subprime problems in USA have been one of the major concerns of 2007, heading the world�s largest economy towards recession. The global economic slowdown forecast for 2008 led by USA, will hit Asia Pacific's exports, but will not be enough to derail the region's expansion. However, the US Government will endeavour to avoid recession because the Republican Party would like to win the 2008 elections. Economists fear that the global economic growth in 2008 might get pegged down from original estimates by about 0.5% down to 4.8%.
The global economy, besides getting adversely affected by recession in the largest economy, will also be ruled by oil prices that have gone from an average of US$75/barrel in 2006 to an implausibly high US$90/barrel in 2007. Polymer feedstock as well as polymer prices rose in line with rising crude prices. Price of commodity polymers such as LLDPE and HDPE increased by 12% in 2007 vis a vis 2006 prices. LDPE price increase in the year was marginally more at 12.5%. PVC and PS price increase was greater than the polyolefin price increase- PVC saw an increase of 14.5% while PS saw a price increase of almost 15%.
Global growth of polymers in 2007 is estimated to show similar levels as pegged in 2006 mainly due to excellent growth in China, good growth in India as well as other Asian countries. Asia now accounts for almost 35-40% of the global polymer consumption, and therefore is a major deciding factor in influencing the global growth of polymers. The polymer demand for consumer products, automotive applications and packaging sector in Asia will continue to drive the growth of polymers; as these three population-driven market segments will benefit from the growing populace of the Asian region that already accounts for 40% of the world�s inhabitants.
It is quite likely that oil will persist between US$70-90/barrel in 2008. Polymer prices are likely to remain range bound at about 5-10% of December 2007 prices. It is to be seen at what price demand would slacken. However, it appears that higher polymer prices are now well accepted, as price of other conventional materials has also increased proportionately. Global polymer consumption in 2007 is estimated to reach almost 235-240 mln tons from 225 mln tons in 2006. China has consistently maintained more than double digit polymer growth in 2007. Similarly India and other Asian countries will also show about 10% growth in 2007.

Leading industry players continue to expand their capacities. Some of the major merger & acquisitions and expansions reported in 2007 have been:

		Basell acquired Lyondell at US$19 billion, creating LyondellBasell the world's third-largest independent chemical firm. Lyondell�s refining business will help Basell offset down cycles in its chemical business and will give Basell a bigger foothold in North America. The alliance broadens the company's product range and gives it more opportunities to grow, particularly in fast-growing Asian and Middle Eastern markets. Currently, 55% of LyondellBasell's sales come from North America, 39% from Europe and the rest from other regions. But in 10 years, the emerging regions are expected to account for 20% of sales.
		Sabic acquired GE's plastics business for US$ 11.6 bln to form Sabic Innovative Plastics. This acquisition will boosts SABIC's turnover from a whopping US$23 bln to US$30 bln, and takes the former commodity-oriented producer into engineering polymers and into the US market.
		Brazil's largest petrochemical company Braskem plans to invest US$2.5 bln in a joint venture with Venezuela's state-run Pequiven in a PP plant. The unit is projected to come on stream in 2009, and output will be sold in markets of Latin American, USA and Europe. Braskem and Pequiven also plan to jointly produce 1.3 mln tons of ethylene, using natural gas as feedstock. This unit is estimated to come on stream by 2011.
		Dow Chemical plans to hive off 50% of its petrochemicals operations to Kuwait's Petrochemical Industries Co. (PIC) for US$9.5 bln. As a result of the ensuing joint venture, Dow will be free to concentrate on more performance chemicals businesses that are essentially technology-driven. The sale will include all of Dow's polyethylene (largest in the world), ethanolamines and ethyleneamines businesses, polycarbonate and polypropylene businesses. The joint venture will own Dow's ethylene complexes in Fort Saskatchewan, Alberta; Bahia Blanca, Argentina; and Tarragona, Spain. Other ethylene crackers, such as Dow's Freeport, Texas, site, will supply the partnership with feedstock under contract.
		Eastman Chemical Company has entered into definitive agreements with Indorama to sell its PET facility and related businesses in the United Kingdom, and its PET and PTA facilities and related businesses in the Netherlands. The sale, which is subject to customary conditions and competition authority approval, includes Eastman's PET manufacturing facility in Workington, United Kingdom, and its PET and PTA manufacturing facilities in Rotterdam, the Netherlands.
		Another major development ready to take shape is that of a giant petrochemical complex in Saudi Arabia by 2013 at a cost of US$20 bln. This can be considered a major milestone of 2007, as seeds of the huge project were sown in this year.