The REAL Deal: SCGC Elevates Polymer Leadership with Long Son Petrochemicals, Empowers Vietnam's Journey to Import Independence

SCG Chemicals (SCGC), a key subsidiary of SCG, is renowned for its leadership in the chemical industry, driven by innovation, sustainability, and community engagement. Building on a strong foundation in Thailand and SCG's longstanding presence in Vietnam, SCGC is expanding its footprint with the Long Son Petrochemicals (LSP) project. This venture marks a significant milestone in the organization's strategy to enhance local production capabilities and support Vietnam's industrial growth. As Southeast Asia's potential continues to rise, with Vietnam at its core, SCGC is well-positioned to capitalize on this dynamic environment through strategic investments.

SCG Chemicals (SCGC), a key subsidiary of SCG, is renowned for its leadership in the chemical industry, driven by innovation, sustainability, and community engagement. Building on a strong foundation in Thailand and SCG's longstanding presence in Vietnam, SCGC is expanding its footprint with the Long Son Petrochemicals (LSP) project. This venture marks a significant milestone in the organization's strategy to enhance local production capabilities and support Vietnam's industrial growth. As Southeast Asia's potential continues to rise, with Vietnam at its core, SCGC is well-positioned to capitalize on this dynamic environment through strategic investments.

Vietnam's economic trajectory in 2024 is truly remarkable, distinguished by a 7.4% year-on-year GDP growth in Q3, marking the highest increase in the past two years. This impressive growth surpasses the 6.93% year-on-year rise recorded in Q2, highlighting the country's resilience in the face of challenges such as Typhoon Yagi, the most severe storm in 70 years. These accomplishments underscore Vietnam's robust recovery and its appeal as a premier investment destination. With a youthful and dynamic population, along with strategic trade agreements, Vietnam continues to attract substantial interest from global investors.

Vietnam's GDP growth is robustly supported by its industrial and manufacturing sectors, with manufacturing contributing 23.88% to GDP in 2023, the highest among all sectors. The transition from an agriculture-based economy to one dominated by manufacturing and services has been transformative. This shift has been fueled by substantial foreign direct investment (FDI), drawn by the country's low labor costs and favorable investment conditions.

A key factor in this growth is the country's demographic dividend, characterized by a median age of 32 and a workforce that is young and increasingly skilled, thanks to advancements in education and vocational training. This capable labor pool allows SCGC, through the LSP project, to efficiently expand its production capabilities. As demand escalates, driven by this dynamic workforce, the need for locally-produced materials and chemicals also increases. LSP is strategically positioned to meet this demand, supplying essential inputs for various industries, thereby driving economic growth and reinforcing SCGC's role in regional industrial development.

Vietnam's geographical position serves as a strategic gateway to ASEAN markets, with its extensive coastline along the South China Sea providing access to major shipping routes and facilitating trade and logistics. The country's integration into global trade networks is further bolstered by numerous free trade agreements (FTAs), which reduce tariffs and open new markets for Vietnamese products.

For SCGC, Vietnam's economic landscape presents vast resource potentials. As Vietnam moves towards becoming a major global player, SCGC's investment in the LSP project aligns perfectly with this growth trajectory. By producing chemicals locally, SCGC can meet the rising demand for materials, creating a mutually beneficial scenario. This strategy not only broadens SCGC's market reach but also supplies Vietnam's manufacturing industry with essential materials for both local and international markets. Additionally, it strengthens SCGC's regional presence and plays a significant role in advancing Vietnam's economic development.

As a leader in Thailand's chemical sector, SCGC harnesses its extensive knowledge and technical expertise to drive the LSP project. By capitalizing on these strengths, SCGC underscores its commitment to excellence and strategically positions itself to adeptly navigate and contribute to the Vietnamese market. This approach transforms visionary goals into concrete value, fostering economic growth and development across the region.

Vietnam currently imports about 75% of its polymer demand, revealing a significant gap in local production capabilities. This reliance on imports presents both a challenge and an opportunity. Through the establishment of local production via the LSP project, SCGC aims to reduce Vietnam's dependency on imports, enhance supply chain resilience, and contribute to the nation’s industrialization efforts.

The establishment of LSP is anticipated to be a catalyst for the development of downstream and supporting industries in Vietnam. By ensuring a steady supply of polymers, LSP will facilitate the growth of sectors such as packaging, automotive, and consumer goods, which heavily depend on plastic materials. This will open up new business opportunities and stimulate economic activity across the entire value chain. For SCGC, the project not only expands its market share in the burgeoning Southeast Asian market but also increases sales and revenue. By positioning itself as a pivotal player in Vietnam's industrial growth, SCGC enhances its brand reputation and secures long-term partnerships, thereby solidifying its competitive advantage in the region.

SCGC's unparalleled expertise in Thailand's chemical industry is showcased by the SCGC Green Polymer™ initiative, which advances the circular economy through innovations like biodegradable packaging, high-quality recycled plastics, sustainable shopping bags, automotive materials, and agricultural mulch films for major brands. This commitment to innovation, quality, and sustainability has earned SCGC a reputation as a trusted partner in the chemical industry.

By applying these principles to the LSP project in Vietnam, SCGC is well-positioned to replicate its success and create value for stakeholders.

At the heart of SCGC's investment strategy is a commitment to advancing communities. The LSP project is not just about economic returns; it is about fostering sustainable development and positive social impact. SCGC is dedicated to being a good corporate citizen, one that prioritizes the well-being of local communities and the environment.

Through various community engagement initiatives, SCGC aims to uplift the lives of those in the vicinity of the LSP project. This includes educational programs, healthcare initiatives, and infrastructure development, all designed to create lasting benefits for local residents. By advancing communities, SCGC reinforces its role as a responsible and ethical investor, one that is deeply invested in the prosperity of Vietnam and its people.

SCGC's community development efforts are guided by a holistic approach that addresses the social, economic, and environmental needs of local populations. For instance, the company is committed to providing vocational training and employment opportunities to local residents, empowering them with the skills needed to participate in the petrochemical industry.

SCGC recognizes the importance of environmental stewardship in its operations. The company is committed to minimizing its carbon footprint and promoting sustainable practices throughout the LSP project. This includes implementing state-of-the-art technologies to reduce emissions, manage waste, and conserve energy and water resources.

By prioritizing sustainability, SCGC not only contributes to the well-being of local communities but also aligns with global efforts to combat climate change and protect natural ecosystems. This commitment to sustainability enhances SCGC's reputation as a forward-thinking and responsible corporate citizen.

SCGC's unwavering commitment to innovation and sustainability lies at the heart of its operations. As a cutting-edge polymer producer, SCGC leverages world-class technology and superior production capabilities within the LSP project. This approach not only guarantees the production of high-quality polymer products but also aligns seamlessly with global sustainability standards, reinforcing SCGC's position as an industry leader.

SCGC leads Thailand's chemical industry with initiatives like the SCGC Green Polymer™ and the Rayong Olefins Plant, focusing on sustainability and efficiency. Its community programs and sustainable water management reinforce its commitment to environmental and social responsibility. This success in Thailand serves as a blueprint for its operations in Vietnam, exemplified by the LSP project’s technological innovation and production excellence.

Integrating cutting-edge technologies, SCGC ensures efficient and environmentally friendly production, utilizing advanced catalysts, automation, and data analytics. Its innovation extends to product development, with a commitment to creating highly versatile polymer products and materials that meet evolving customer needs.

The LSP project aligns with SCGC's commitment to global sustainability standards, such as the United Nations Sustainable Development Goals (SDGs). By adhering to these standards, SCGC demonstrates its dedication to responsible business practices and its role as a leader in the global chemical industry.

SCGC's sustainability initiatives are supported by a comprehensive framework that encompasses environmental, social, and governance (ESG) considerations. This framework guides the company's decision-making processes and ensures that sustainability is integrated into every aspect of its operations.

SCGC's investment in Vietnam's LSP project underscores its dedication to excellence and sustainable growth. By enhancing local production capabilities and fostering community development, SCGC is set to play a pivotal role in Vietnam's industrial advancement. As the company continues to innovate and expand, it positions itself at the forefront of the petrochemical industry, paving the way for a sustainable and prosperous future in Vietnam and Southeast Asia. This strategic move offers exciting opportunities for stakeholders and promises to contribute significantly to the region's economic development.

References

• https://asia.nikkei.com/Economy/Vietnam-Q3-GDP-growth-rockets-7.4-highest-in-2-years
• https://www.gso.gov.vn/en/data-and-statistics/2024/07/socio-economic-situation-report-in-the-second-quarter-and-six-months-of-2024/
• https://www.statista.com/statistics/1047681/vietnam-gdp-contribution-of-manufacturing-sector/