A snap general election in June 2017 that resulted in a minority government has added to the uncertainties created by the Brexit vote in 2016. However, British petrochemicals producers may find some reassurance in the dimming likelihood of a hard Brexit, as well as the evident lack of enthusiasm in Scotland for a second referendum on independence. The main risk is the potential for the UK to 'crash out' of the EU with no post-Brexit deal or transition arrangements. A 'cliff edge' for Brexit would put British petrochemicals plants in danger of closure.
In H117, petrochemicals and chemicals grew 9.3% and 3.4% y-o-y, respectively. However, plastic and rubber products declined 2.2%. The trends indicated a shift towards lower value products with a focus on exports, while household consumption stagnated amid declining real income and growing uncertainty over the country's long-term prospects.