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The EU Chemical Ponzi Scheme (FREE)

How EU institutions are complicit of transferring billions of EU tax payer money into the pockets of wealthy powerful chemical companies. In the meantime, the tax rate of EU citizen keep raising. It's a remake of the feudal system.

European chemical companies say they need public funding to develop safer alternatives and stop producing hazardous chemicals. But, at the same time, they spend billions of euros buying back their own shares to boost stock prices.

In a time of environmental and geopolitical crises, the issue of how Europe’s industries should be made more resilient and sustainable is at the top of the EU agenda.

As a result, several industry-specific discussions for so-called transition pathways, roadmaps for how each industry ecosystem should be made more “green and digital”, are already underway.

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In the coming weeks, a transition pathway for the chemical industry will be presented at an EU Commission roundtable (where ChemSec will have a seat).

The following discussion will revolve around the roadmap towards sustainability for Europe’s chemical industry.

“European chemical companies think that EU member states should pay for developing safer alternatives”

If we are to believe industry spokespersons, they relish the challenge and the opportunity.

“The next generation of chemicals that are safe and sustainable by design is set to be a growth engine for Europe”, says Marco Mensink — head of the European Chemical Industry Council (Cefic) — in a recent interview with the Financial Times. 

“But developing them is where public funding should come in”, he concludes.

That’s right. The big European chemical companies think that the Commission and the member states should pay for the developing costs of safer alternatives.

This may be due to the economic pressure the industry is already experiencing. Martin Brudermüller — President of Cefic (and CEO of chemical giant BASF) — seems to think so as he laments the low growth rates in Europe in another Financial Times interview

So, what is this strained industry spending its money on if it so desperately needs government money to be more sustainable and keep up with the times?

“Stock buybacks”.

Here’s how it works. Instead of reinvesting profits in the company to improve its business — for example, developing safer alternatives — the company buys back shares from its owners and then terminates them (the shares, not the owners).

This leaves a reduced number of outstanding shares on the market, which boosts the short-term stock prices. It can also inflate other measures of company performance by lowering the amount of capital employed.

Here are some recent examples.

At the beginning of 2022, AkzoNobel announced a “repurchase programme” aiming to buy back up to €500 million of its shares. A couple of weeks later, Covestro — a spin-off company from Bayer — said it would do the same over two years. And the same day as Covestro, Linde, a leading producer of industrial gases, announced a two-year share buyback programme of $10 billion.


Published by Chemsec, the International Chemical Seretariat

Big Chem spends billions on elaborate stock buyback schemes — but still asks for public funding

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