Sabic’s losses (headquarters pictured) are the result of a huge decline in the auto industry and the associated drop in demand for plastics and chemical products from the United States, Japan and Germany.
The Riyadh-based company, also the kingdom’s largest steelmaker, had to cut prices for the metal since October as domestic construction orders slowed.
Renamed Sabic Innovative Plastics, and still specialising in plastics, the company plans to eliminate about 1,000 jobs from its workforce of 10,500.
Just over a year ago it bought General Electric Co.’s plastics business for US$ 11.6 billion; since then it has seen sales for resins and thermoplastic sheets used in cars, roofs and lighting drop substantially.
The credit crunch has indeed hit Arab countries hard, already floored by the drop in oil prices, their main export.
One victim has been Dubai’s real estate market which has lost hundreds of jobs in the last two months.
Local service companies are also cutting staff by 10-15 per cent as the economic downturn shows no signs of ending any time soon.