Alba to use economic downturn to plan global expansion

Bahraini giant upbeat about long term prospects despite global market conditions.
Alba to use economic downturn to plan global expansion
COMPANY EXPANSION: Aluminium Bahrains chairman said that the company plans to expand into Europe to tap into new markets across the globe. (Getty Images)
By Gavin Davids
Tue 06 Apr 2010 02:37 AM

Aluminium Bahrain (Alba) plans to use the current economic downturn to explore ways of tapping into new markets across the globe according to the company’s chairman, Mahmood Hashim Al Kooheji.

He added that he hoped that the rise in demand will take place in the next five years.

Speaking to Oxford Business Group, Al Kooheji remained upbeat about the long term prospects for Bahrain’s aluminium giant, despite the impact of global market conditions.

He said: “We have the opportunity now to complete improvements and modernisation so that we’ll have the capability and the capacity to meet the rise in demand that we envision.”

He added: “I suspect that by 2014, there will be a shortage of aluminium and prices will be driven up, so we need to expand while we have a window of opportunity.”

While Alba’s low operating costs have provided a buffer against the immediate impact of the economic downturn, Al Kooheji admitted that the company had been forced to rethink its organisational structure to ensure it remained competitive in the long term.

He said that the almost two third price drop in aluminium around the world put a lot of producers in difficult positions.

As a result, Al Kooheji is keen for Alba to explore initiatives that would help the company expand across Europe.

He said: “The biggest increases in demand are coming from East Asia, primarily China, but I feel that Europe will pick up as well.”

He added: “If we can enter into a Free Trade Agreement with the European Union, our chances of expanding into the European market will be much greater.”

Kooheji said that he was unfazed by the prospect of further aluminium plants opening across the Gulf Cooperation Council states.

He asserted that increased competition would provide many benefits, including improved efficiency, a rise in the number of skilled workers and a reduction in costs.

He said: “We account for only around one percent of total world aluminium production, the market is large enough for increased competition.”

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