Report for Middle East

The first quarter of 2025 proved to be a tough period for the plastics sector in the Middle East. The polyethylene (PE) and polypropylene (PP) markets were impacted by a mismatch between supply and demand. Sluggish consumption - fuelled by economic turbulence from currency depreciation, elevated interest rates and persistent inflation - weighed heavily on market activity. For example, Turkey raised its benchmark interest rate in March to 50% in a bid to curb inflation but the move also dampened consumer and industrial spending.

Significant capacity growth in the region has intensified concerns about market saturation. Notable developments include Advanced Polyolefins Industry Co’s launch of an 800,000 tonnes per year PP facility in Saudi Arabia, alongside Sipchem’s Al-Waha plant which is expected to boost annual PP production by 150,000 tonnes by the end of 2026. These expansions contributed to a reduced export performance in the first seven months of 2024 when Saudi Arabia’s polypropylene shipments fell 17% year on year to 3.584 million tonnes.

Despite less promising market trends, progress continues in the field of recycling. Governments and private players are actively investing in infrastructure upgrades: in Saudi Arabia, for example, there is a growing focus on smart recycling technologies and facility expansions; and Egypt’s plastics recycling sector - valued at approximately US$ 380.25 million in 2024 - is forecast to grow to nearly US$ 474 million by 2030, underpinned by stronger regulatory support and public environmental awareness.

Looking ahead, industry players expect a near-term continuation of the trend towards oversupply and muted demand. Regional markets remain under the influence of broader economic and geopolitical instability, limiting prospects for a meaningful recovery in the short term.