Dow Chemical Co. reported a 73 percent increase in second-quarter earnings on Wednesday, with double-digit volume growth in Latin America, Asia Pacific, and the Europe, Middle East and Africa region.
During a conference call with analysts, Andrew N. Liveris, chairman and CEO, discussed views on China, which has been trying to slow its robust economy to curb inflation.
QUESTION: What type of demand are you seeing in China, given its inflationary pressures?
RESPONSE (CEO Liveris): I think it's important to understand exactly what the inflationary pressures are in China and just like when we measure inflation over here, it's all about the basket.
And remember a lot of their agricultural commodity price increases are all perishable goods versus packaged goods, for example, and that's a big difference in terms of what you count in the basket and what you don't count. In addition, gasoline, petroleum, that's been another big one of their worries and then speculation around the construction sector.
So what the Chinese are doing, they're doing it very well, I mean, they basically are moving away from the pain the population feels in increasing perishable good pricing as well as petroleum, gasoline pricing and then, of course, the rampup in speculation in the housing sector.
So but their basic economy, their industrial economy, their manufacturing economy is still doing very well. And they have to do very well because of their employment...which, of course, overrides all their concerns. They're managing themselves down very nicely. The official numbers are 8 or 9 percent GDP and when you put a multiplier on for chemicals or plastics, that's a 12, 13 percent growth rate in the world of chemicals and plastics.