The Executive Board bases its estimate of the overall risk situation on the risk management system in place. The system assesses every risk indicated by our divisions, corporate departments and regional entities. It is regularly reviewed by the Executive Board. One new sales-market risk for WACKER emerged in 2012 in the shape of anti-dumping proceedings instigated in Europe against Chinese solar businesses, as well as the anti-dumping and anti-subsidy proceedings brought against European polysilicon manufacturers by the Chinese government. The result of these proceedings is open and poses a significant risk for our polysilicon business. In numerous talks at a political level, we are actively striving to avoid punitive tariffs against Chinese solar manufacturers in Europe and European polysilicon producers in China, respectively.
The overall risk has therefore increased compared with 2011, although all other stated risks have remained more or less constant. As per this report’s publication date, the Executive Board does not see any individual or aggregate risk that could endanger WACKER’s future in any material way. Market risks in the photovoltaic industry, which is marked by overcapacity and price pressure along the entire supply chain, as well as intra-sector consolidation, continue to impede our polysilicon business. Despite these risks, we see good opportunities for WACKER to be successful in this market in the medium to long term. We remain confident that WACKER is strategically and financially so well-placed that we can take advantage of any opportunities that arise.