LEIDSCHENDAM, 24/05/06 - The Dutch chemicals sector is counting on sales growth of at least 6 percent in 2006. Last year, growth was 9 percent, according to figures published yesterday by sector association VNCI.

VNCI warns against over-optimism. "The green light is on in the Netherlands, but there are also threats," said chairman Rein Willems, who is director of Shell Nederland. He was referring here to the high price of oil, which has tripled in four years. He also referred to the "unnecessary administrative pressure" such as substantial test requirements for chemical substances.

The chemicals industry, the biggest sector in Dutch industry after food, did not always succeed in passing on high oil and gas prices fully to customers in 2005. Nonetheless, sales climbed 9 percent to 40 billion euros. The growth wholly reflected selling prices, while production volume stuck at the same level as in 2004.

For 2006, VNCI sees sales growth of 6 percent reflecting both higher production (up 2 percent) and higher selling prices (up 4 percent). In the first three months, sales surged 12.5 percent. According to Willems, the Dutch chemicals sector is currently benefiting from rising demand and a reviving European economy.