MARTÍN TOSCANO

Mexico 2020 | INDUSTRY | VIP INTERVIEW

TBY talks to Martín Toscano, President & General Manager of Evonik, on Mexico's export market, building a sustainable chemical industry, and motivating forces for private investors in the country.

Which business segments would you like to have a stronger presence in?

We strive to become a greater partner for segments where we already participate. One is in agriculture, for which we have products and technology that we are already offering. Agriculture shows amazing potential in Mexico, along with the automotive sector. They are two fast-growing segments in Mexico, and we have a key role to play there. Personal care is also an interesting market with growing sales. There are also opportunities in the protein business and animal nutrition, since Mexico plays an important role globally in protein production. Another area of opportunity is in activities connected to sustainability in energy and waste treatment. We have multiple projects in the energy sector, and we are engaged in dealing with the topic of plastics and chemical recycling in support of the circular economy strategy. Biogas is another topic we are discussing here. We are continuing our work in wastewater treatment. Now, it is time to materialize the country's goals and see how we can help. Thus far, we have been talking about potential and how important it is to see it in Mexico; however, it is time to take a more hands-on strategy. As a specialty chemical company, we play a leading role and have a moral and social obligation to drive the necessary changes for a more sustain-able business in Mexico.

What factors are behind Mexico's resilience in the export market?

It has an interesting combination of exports. There are certain industries with extremely strong ties to export markets, not just traditional ones. The automotive industry was in the “driver's seat" for many years. We also see significant growth in the aero-space sector, as well as agriculture and other segments with increasing exports and thus a stronger role in the global economy. Additionally, there is a growing middle class in Mexico driving the economy and consumption. Many of our customers are connected to this middle-class growth in the local market.

Why is it important to establish closer ties between the chemical industry and the new administration?

It is important that the chemical industry, through the Chemical Industry National Association (ANIQ), wants to establish a closer relationship to the new administration and discuss opportunities in the sector and market that benefit the people of Mexico. The chemicals industry is growing in Mexico, though production has not caught up due to local constraints. That means we continue relying on imports. Although we have the capacity, it is not utilized, mainly because we lack access or supply to key elements and resources such as natural gas or raw materials from the downstream petrochemicals industry. But the industry is committed, and ANIQ wants to support local production and satisfy needs by producing locally; however, we need to align with the current administration further to find a way to team up and work together for a sustainable chemical industry in Mexico and create good impact on people's well-being.

Will you be increasing imports to increase production?

For Evonik, bringing new capacities and production to Mexico in specialty chemicals depends on the current raw materials supply and local infrastructure, which is still not there. For the time being, we will focus more on relying on imports that we bring from Europe, the US, and all other global assets from Evonik Industries, and eventually find ways to add value through local manufacturing or teaming up with local players for the production of products and technologies. There is capacity in-stalled and an industry keen to support that growth and demand in Mexico; however, we rely and aim on consolidating a stronger relationship with the authorities, Pemex, and other suppliers in order to be able to run sustainable production and businesses in Mexico. At the end of the day, that will give us the necessary competitive advantage to motivate the private sector to continue investing and remain committed to Mexico.