Ineos boss Sir Jim Ratcliffe: UK chemical manufacturing ‘having the life squeezed out of it’
Ineos boss Sir Jim Ratcliffe has warned British chemicals manufacturing is having the “life squeezed out of it” by the government, and is on the verge of extinction.
The business titan slammed the de-industrialising of Britain, which started in the 1970s and 1980s, and criticised the government for a lack of energy strategy and high carbon taxation.
The chemicals giant made his comments after years of strain on energy prices, made worse by the Russian invasion of Ukraine in February 2022.
Inflation has also made production more expensive in many sectors, affecting everything from food and drink to clothes and travel.
More recently, the uncertainty in the UK economy, a weakening pound and the prospect of Donald Trump imposing tariffs, has poured fuel on the fire of inflation, which analysts are concerned will remain a feature of the UK economy.
Ratcliffe, chairman of INEOS said: “De-industrialising Britain achieves nothing for the environment. It merely shifts production and emissions elsewhere.”
“The UK, and particularly the North, needs high quality manufacturing and the associated manufacturing jobs.
We are witnessing the extinction of one of our major industries as chemical manufacturers have the life squeezed out of it.
It comes as the government continues to pursue a Net Zero strategy, encouraging the closing down of polluting industries and transition to cleaner power, which has led to thousands of jobs going.
The Grangemouth chemicals plant, which produced synthetic ethanol for use in healthcare and pharmaceuticals, had a capacity of 180,000 tonne per year, equivalent to filling 90 Olympic sized swimming pools.
Ineos said in the last 20 years emissions from its operations at the plant have fallen by half, but the next steps required more investment.
Calling on the government to take action, Ineos put forward three areas which would support industries, which are competing with the likes of China and India.
“Current system favours importers who pay nothing”
Ratcliffe, who is also now an owner of Premier League giants Manchester United, urged the government to put forward a more robust energy policy giving fairer prices for gas and hydrogen. He also called for an emissions trading scheme, supporting industry while it decarbonises.
“The current scheme acts as a tax on UK operators and favours importers who pay nothing”, the firm said.
The business leader also urged a sea-change in UK trade policy, backing British manufacturers in its own market, and not incentivising imports.
The closure of the plant will result in a net loss of 80 jobs at Grangemouth, a Scottish plant which is one of only two operational in Europe, directly, and a further 500 indirect roles lost, in the wider economy, the company said.
A UK Government spokesperson said: “This is very disappointing news from Ineos. Although the company has said affected employees will be redeployed elsewhere across the site, this announcement will still cause concern for workers and their families. This yet another example of the failure of Scotland’s two governments to have had a credible industrial strategy over the past 14 years.
“That is why the UK Government is developing an industrial strategy that works for Scotland and the whole of the UK, but that comes after over a decade where Scotland’s industries had no joined up plan for growth.
“Before July last year there was no plan to support the Grangemouth workers. Within a matter of weeks, and working with the Scottish Government, we announced £100m to support the local economy and create jobs, and launched Project Willow to explore options for a sustainable industrial future for the wider Grangemouth site.”