Humankind is facing its largest challenge ever, climate change. There is scientific proof, and the impact is visible worldwide. Research results from the Arctic are alarming. The ice is melting at an incredible speed. Stream weather events are increasing.
Leaning back and ignoring facts is not an option. On our journey to a more sustainable and climate neutral future, we are setting ourselves new and even more ambitious targets. We want to make BASF net carbon neutral by 2,050. Climate protection is an essential element of our strategy. Through our products and innovations, we help our customers reduce their carbon footprints and are thus part of the solution.
At the same time, the chemical industry is energy intensive, and with that, CO2 intensive as well. However, we are taking on this challenge. We have made significant progress over the past few years. On this basis, we want to move forward even faster. We want to reduce our absolute CO2 emissions by 2,030 compared with 2018 by 25%.
Compared with 19 90, this is as much as 60% less CO2 emissions. This exceeds the European Union's target. We want to accomplish this and at the same time grow and As part of our carbon management, we have already started operating the first test and pilot plants. We know that this transformation is Technically possible, but we also need large amounts of renewable energy and a favorable political framework. If politics, industry, and society work together, we can accomplish energy transformation.
But above all, we need bold ideas, courage, and entrepreneurship. We look ahead with confidence.
Good morning and welcome to the Annual Shareholders Meeting of BASF In the year 2020, in my capacity as the Chairman of the Advisory Board, I welcome you, representatives The press and everything everybody else who follow these LGM live on the Internet. In my capacity as the Chairman of the Supervisory Board, I take the chair according to Section 18 clause 1 of the statutes. I would have loved to welcome you to Mannheim personally, But you know that unfortunately it's not possible. We can't have an attendance full attendance assembly somebody Nobody could have imagined that possible last year. We hope that it's going to be finally possible again next year To meet in Rosengarten, Manheim.
In the calling for the AGM, you could learn that the Board of the Executive Directors with the approval of the Again, we used a possibility, which the legislature last year With the COVID-nineteen Act created and they took some minor amendments and expanded This law, the virtual AGM enables us to protect the health of our employees, the service providers here and at the same time To comply with the official rules and have the meeting in due form and time. I hope this is also in your interest. At the same time, we ensure also That the dividend decision and that's very important can be taken in due time. Due to the existing social We have limited the people here in the assembly room clearly. Of the Supervisory Board, apart from myself, that's My 2, Vice Chairman, Franz Fernbach and Mr.
Horwath, all the members of the Board of Executive Directors are present. The further members of the Supervisory Board can follow the AGM via the Internet and if need be they can communicate with myself And the members of the Board of Executive Directors and the Royal Advisory Board. We have also Mr. Wolfgang Haas, who is the General Counsel of the BASF SE And the notary Doctor. Matthias Meyer, who will write the minutes for today's shareholder meeting.
We also have the company proxies present. And of course, you can't see that a whole number of service providers and Helping hands that make sure that everything is going to be perfect technically. The conduction of these virtual shareholder meetings makes some necessary restrictions for you unavoidable. And I personally have to say that I really regret it because I believe that the shareholder meeting is an important, maybe even the most important A meeting and event for our shareholders and it's a good tradition that we meet at Rosengarten in Mannheim In person with you and always have a very vivid dialogue. This dialogue is very important for the Board of Executive This is much easier when we're all assembled together in one room.
And so far, the hope, and I think this hope is quite well founded, Is that we can meet again with a full present attendance in the Rosengarten, so that you can take your Possibilities in the framework of what is legally admissible. The all shareholders can and could exercise their voting rights by Britain has sent you votes by way of electronic absentee voting and also by granting power of attorney to the company proxies Order to all the 2, the intermediaries and stakeholder associations and proxy advisers. On addition, all the registered shareholders could submit questions via the online service to the AGM, and this was also used until, well, 23 hours 45. The questions will be answered after the management report of Martin Bodermiller. Shareholders that exercise their voting right You could also, until one day before the assembly, submit questions in writing via the online service.
These questions We're made available to all shareholders in the online service and until the conclusion of today's AGM can be reviewed there. On top of that, the management report was made available to the shareholders' assembly already 1 week before the AGM on the online service. Thus, this presentation could already be read before. You, of course, were still lacking the figures for the first quarter that were made available this morning. And you could also consider this presentation in your questions submitted.
Meetings was announced in the Federal Gazette on the 18th March 2021. I therefore state that this AGM was called in due form. This year too, there's a list of participants in the form of an attendance information. In the participants' lists of participants, the company Proxies will be included. Depending on the powers of attorney or instruction issues to the company proxies, The attendance will still change until the point of time of the voting.
At the moment, on the basis of the powers of attorney and proxy instructions granted so far, the number of Attendance is 49.5 percent of the statutory share capital are represented. This number includes the votes issued to the proxies as well as those received via absentee voting. The company proxies represent a total of 438,781,436, this is a present of 47.77 percent The of the share capital. On top of that, there are plenty votes of 16,353,855 individual The attendance information can be reviewed by all registered shareholders on the online service. And I will announce The updated attendance again before we take the vote.
Before we have a delegate.
Now before going through the items on today's agenda, Ladies and gentlemen, now let me talk about the organization and the procedure of today's AGM. In due time and form. Afterwards, we will then take the votes on the resolutions announced in the agenda and the proclamation of the resolutions made. Before, however, I would like to ask Wolfgang Haas to give you another few instructions on today's Either by electronic absentee voting or by issuing power of attorney to the company proxies also during these AGM And until the end of the voting. The end of the vote will be announced by the Chairman of the Assembly.
Until the end of that vote, Your votes and instructions to the proxies can still be changed via the online service. Kurt Bok will remind you in due time to The vote can also be found in the calling and invitation for today's AGM. The proxies will vote The written absentee votes and the electronic absentee voting that were handed in due form and time Execute the notarial recording according to the German Stock Corporation Law. And he will monitor the cast of votes And the counting of the votes, the technical preconditions for that were verified before this AGM in this room. Yes.
Well, thank you very much for these instructions and explanations. Maybe one word on Mr. Haas personally. It's his 10th AGM today that he attends as General Counsel of BASF. And at the end of this month, He will retire, which is well deserved and it's quite adequate when I will ask or Thank you for these 10 years of very good cooperation.
Dear Wolfgang, you led us through the legal difficulties of the AGMs with a safe and Sure, Han. Thank you very much for this good cooperation and all the best for the future. Thank you. That brings to another important personal change and that's for the Board of Executive Directors. It is already well known, but I will explain it On the 31st of this year, Moyn Smith will go from or resign from the supervisory board.
He's been with BASF For 16 years and he is now responsible for chemicals, petrochemicals and intermediates, the segments into materials with monomers and Performance Materials as well as the region North America where he also has his office. His business Had the difficult times last year this year in Q1, and Mr. Brudendel will talk about that as well, has boomed so that With his resignation, he could represent excellent figures. Wayne, as I said, has been with BASF since 2004. After a short time, only 2 years, he was made head of the new business operating division, Catalyst.
That was an acquisition of Engelhardt. And for many years, he successfully led and developed the business in North America, in Brussels, in Lutissafen and also here in the Board of Executive Directors. Wayne, we wish you all the best for the future. Thank you very much for your cooperation. And I am very pleased to meet you again in the future in Now we have another personal change following this up because then we also needed a successor.
In this case, it is A female successor in the Board of Directors is Melanie Marsbrunner. Doctor. Marsbrunner has been for And she leads Nutrition and Health. In her new role, she holds the position of Chief Actology Technology Officer, which we assume from Martin Brodermuller. This comprises the responsibility for the 3 research areas of BASF Global Engineering Services and Corporate Environment and Protection, Health and Safety as well as the Industrial Relations Manager, which you will assume for Michel Michel Heinz then on the 1st June will assume the task of Wayne Smith in North America and he will keep his responsibility for The region, South America.
So here, this is all I wanted to say On the formalities of today's assembly. And ladies and gentlemen, let me now talk about the agenda. The financial statement and the consolidated financial statement of BASF Group for 2020 as well as the management reports of BASF And the Supervisory Board's report and the proposal for the appropriation of distributable profits were published together with other documents according financial statement of BASF Group as well as the management report of BASF SE and BASF Group were audited by the elected auditors and granted the unqualified The financial statement of BASF SE and consolidated financial statement of the BASF Group were approved by the Supervisory Board. The financial statement of BASF SE was thereby made final according to Section 9 in conjunction with Section 172 German Stock Corporation Law. In 2020, the Supervisory Board has been informed during 7 meetings in the business year 2020 about the management and the situation Several other subjects will be dealt with in the presentation of Martin Brodemuller.
Also outside of the supervisory board meetings, the discussion in detail in the current development of the business situation in the essential parts of the business and projects. For the further activity of the Supervisory Board, I refer you to the detailed written report, which you can find in the BASF Report 2020 on the pages 203 to 209. The corporate governance report can be reviewed in the BASF report as well on the pages 168,000,000 to 176,000,000. And What is particularly important for you maybe you can also find the compensation report and the allowances and flows of income for 2020 for all The members of the Board of Executive Directors on the page is 183 to 202. Now on the management report.
At the beginning, you see a film in which the employees of PSF talk about their work in the times of the pandemic.
Working in times of a pandemic. Employee voices worldwide.
We had high turnover in our engineering group. On top of that, my wife was a medical I was pulled into the ICU, the intensive care unit, at one of the hospitals that was the epicenter of COVID. BASF gave a donation of PPE and equipment. I was able to deliver that to my wife and her team. I'm very grateful for that support and, I'm glad things are getting better now.
Due to corona, the order pattern of our customers was turned upside Down overnight, one big advantage in that was the network of our global production plants and excellent crisis management and a great team that turned around Every single stone to make sure we do not let down our customers in these difficult times. Henkel awarded us this year with the
With our experts on-site, due to COVID-nineteen, however, this was and is not always possible. The moment we realized that we are facing a problem with respect to product launches, We immediately shipped out so called augmented or mixed reality headsets to our customers, so our technical experts made sure To guarantee a flawless production setup and the most important without any time delay.
India is currently in the 2nd wave of the COVID pandemic. Challenging times here. We have a lot of, LESF employees who are impacted. This is, definitely, challenging. But at the same time, I'm also
I think it helped people To get the work done without some of the regular supervision that people were used to. So I would say that it Took their level of responsibility, discipline and leadership onto a different level. COVID-nineteen is something unexpected. We have to work Beyond our regular hours, this has left us with a strong, united, Resilient team, which is ready for bigger and better challenges. Instead of saying me, it's
BASF, we create chemistry.
Dear shareholders, ladies and gentlemen,
I wish
you a warm welcome to our virtual Annual Shareholders Meeting. A year ago, I said I hoped that we would be able to meet Again at Rosengarten Congress Center in 2021 for an AGM like the ones we've had before. Unfortunately, this is not yet possible. Nevertheless, Like last year, we will provide you with comprehensive information about BASF just in a digital format. We've just heard from our employees.
In the film, they talked about last And how they experienced 2020 at BASF. I agree with them. We worked hard for our customers. We were able to keep up deliveries. Again and again, we creatively looked for solutions and our BASF team demonstrated solidarity.
With our Helping Hands initiative, we made our contribution to society. There have also been some incredible accomplishments in science. Since against the coronavirus were developed in record time. They are the crucial instrument for getting the pandemic under control. Production, distribution and the vaccination campaigns cannot come fast enough.
Pragmatism and rolling up our sleeves are now more necessary than ever. Priority group 2 and we started on April 14 to do so. Our organization is running smoothly and we hope to be able to vaccinate our entire work This is established by the government of the state of Rhinoplatinib. Our facility helps ease the strain on regional and community As a society, we should learn something from this. We can become much more innovative.
With courage And good ideas, the challenges of our times can be overcome. I'll come back to this topic later. Here is what I'd like to talk about today. First, a look at our figures. What kind of year did BASF Group have in 2020?
And how did we perform in the Q1 of 2021? Next, how are we implementing our strategy? How are we actively advancing sustainability? One topic is particularly important to me, reducing CO2 emissions. There is a lot of global momentum here And the pace is quickening.
We at BASF want to take a leadership role in our industry with innovation and new technologies. The pandemic caused the global economy to crash. The restrictions have been very challenging for almost all sectors. Borders were closed. Supply chains collapsed.
In the 1st 6 months, production declined around the world with one exception. The Chinese economy already started rebounding in the second €59,100,000,000 This nearly matched the level of the previous year. Our operating earnings, Income from operations before special items were €3,600,000,000 which represented a decline of 23%. Our free cash flow amounted to €2,300,000,000 In 2019, it was €3,700,000,000
These
figures reflect a challenging year, which was shaped by uncertainties. Nobody could have predicted this. In EBIT, we had special items of minus €3,800,000 compared with minus €442,000,000 last year. The increase is primarily attributable to impairments, Which we had to recognize especially in the Chemicals and Materials segments as well as in Surface Technologies. Earnings per share amounted to minus €1.15 compared with €9.17 in 2019.
This significant decline can be explained by the impairments I just mentioned as well as the book gain last year from the deconsolidation of the Wintershall businesses. In nearly all segments, we reported lower operating earnings. The sole exception was the Industrial Solutions segment results of the BASF Group. One main reason for this was a significant decline in orders from the automotive industry. Our most important customer industry was affected by lower demand, production stoppages and supply chain disruptions, primarily in the first half of the year.
Overall, we benefited from our broad portfolio. Fluctuations in individual business areas could be partially offset by other units. Our business development in the 4th quarter was very pleasing. We were able to increase our sales volumes in all regions and nearly all segments. On the whole, we had a strong final quarter.
These tailwinds carried over into the Q1. We had a Strong start to 2021. We increased sales by €2,600,000,000 compared with Q1 of 2020 to €19,400,000,000 This was mainly attributable to higher prices and higher volumes. Compared with the prior year quarter, EBIT before special items increased by 42% to reach €2,300,000,000 This was primarily the result of considerably increased earnings contributions from the Materials and Chemicals segments. Earnings in the Surface Technologies segment also rose considerably, thanks to the recovery in automotive production.
In the Q1, all regions contributed to the significant increase in the earnings of the BASF Group. Dear shareholders, For many of you, the dividend is a key criterion in choosing your investments, especially in a time of low interest rates. There is a demand for reliable securities as long term financial investments. The BASF share is such an investment. For many years, it has been one of the most popular shares among private investors, which pleases us.
Despite the pandemic, we generated a solid cash flow in 2020 and BASF once again proved its resilience. A reliable dividend payment is a priority for the BASF Board of Executive Directors even in difficult times. We are confidently looking to the future. We therefore propose to the AGM a dividend of 3.3 Euro per share for the 2020 business year, the same as in the previous year, for a high dividend yield of 5.1%. We want the BASF dividend to remain attractive for you in the future as well.
We want to make this possible with a high cash flow based on operational strength. This is the core of our dividend policy. I've been working for BASF for 33 years. During this time, we faced some challenges, including the financial crisis of 2018, 2009. Last year, however, overshadowed everything.
And yet, Our company has successfully navigated through the pandemic. I attribute this to our strong solidarity. This is something we can all be proud of. I want to express my heartfelt thanks to all of our employees. They've done a terrific job.
And this is the reason why we are paying a bonus for the 2020 business year. Based on our results and the agreed rules, This was not required, but we want this bonus to be an expression of our gratitude and of our appreciation. Many challenges, we want to remain operationally strong and grow profitably. What are we doing to achieve this? 1st, we remain fully committed to more customer focus.
This is the key element of our strategy. During the pandemic, many of our customers faced challenges like never before, but they could rely on us Because we were able to deliver our products to them and they appreciated our efforts. In this 2nd, we want to continuously improve. Our aims include lower costs, improved processes and greater competitiveness. This What it's about?
Our excellence program delivered an EBITDA contribution of €1,400,000,000 last year. The associated costs amounted to €200,000,000 From the end of 2021, We want to achieve an annual EBITDA contribution of €2,000,000,000 The associated one off costs Services unit will also contribute to increasing efficiency. Annual costs will decline by €200,000,000 as of 2023. Worldwide, we are streamlining internal services and responsibilities. And we are shifting activities to our existing service centers in Berlin, Kuala Lumpur in Malaysia and Montevideo in Uruguay.
The new structure will lead to a reduction of 2,000 positions globally, including 600 in Ludwigshafen by the end of 2022. 3rd, we are focusing the construction of our Nuevo Boon site in Zhanjiang. The city is located in Guangdong province in Southern China in the middle of the country's industrial heartland. We started construction here on May 30. The first plants will produce engineering plastic and thermoplastic polyurethane.
This will enable us to serve the growing demand from our local customers who come primarily from the automotive and electronic
A
broad BASF for Bund side will be built in different stages and it will be 100% owned and operated Why BASF? With offerings for many of our customer industries. You may be wondering why is BASF so active in China. There is a simple answer to this question. The country drives the global market for chemicals.
Today, it accounts for more than 40%. By 2,030, China's market share will grow to more than 50%. By then, Almost 70% of global chemical growth will come from China. We want to participate in this growth. This is why we are investing in Jiangjiang.
We are planning to invest US10 $1,000,000,000 in this project by 2,030. Jiangjiang We'll be our 3rd largest site after Ludwigshafenet and work. Our second focus area is battery materials. We are investing in e mobility. Demand for lithium ion batteries is growing continuously.
The trend is clearly heading in one direction. More and more automotive firms are transitioning to electric vehicles. The market is growing and we see good opportunities for BASF here. Our cathode materials are crucial for the performance of batteries. But not only that, other key aspects are affordability, safety and sustainability.
All this It's only possible with innovative materials. We've been operating production plants for battery materials in the United States in 2012 and in Japan since 2015. Now we are expanding our activities to Europe. We will produce precursors in Harjavalta, Finland. We will then use these to produce the finished cathode materials in Schwarz Heide, Germany.
Construction of our plants is proceeding according to schedule. We want to be finished next year. One thing is for sure, we will then have a strong position in Europe. Automotive production is important for the European economy. The European Commission is therefore supporting these investments.
Establishing a value chain for batteries has been recognized as an important project Of common European interest because such an important technology should also come from Europe. I think we can all agree on that. And this brings me to 4th, our portfolio. We are focusing our portfolio on profitable growth. We accomplished quite a lot in this area last year.
In January 2020, we acquired Solvay's polyamide business. The involved businesses have been successfully integrated. They are part of our Performance Materials and Monomers divisions. Anticipate being able to close this deal in the Q2. And finally Wintershall Dea.
The integration has been successfully completed. The new structure offers the expected advantages. The planned IPO depends on market conditions. Dear shareholders, Now I come to a very important topic for us and for me personally, climate protection. The coronavirus pandemic has thrown many things off course, but fortunately not the efforts to combat climate change.
Around the world, this challenge is a priority for policymakers and society. Europe has taken on a very ambitious leadership role. The European Commission has presented its Green Deal. One of the several objectives is reducing CO2 emissions in the EU To 0 by 2,050. This would make Europe the 1st climate neutral continent, which is an ambitious goal.
The once in a century project will affect all of us. It is about much more than protecting the climate. It's About the circular economy, biodiversity and agriculture. And it's also about digitalization and sustainable finance. For the chemical industry and our customer industries, it will also mean a tightening of rules governing the approval of products on the European market.
The Green Deal is like a master plan for a more sustainable life. How will we produce and consume in the future in Europe? How will we live? There will be many changes. To do this while maintaining our competitiveness, we need intelligent and supportive solutions.
And we need joint responses from policymakers, business and society. The European Commission also tells us The goals of the Green Deal cannot be achieved without the chemical industry. I can only agree here. Chemistry is part of the solution Because we offer innovations for a more sustainable life. Just think about the battery materials I mentioned earlier and modern catalysts Or materials to insulate buildings or high performance materials for wind turbines.
Our products contribute to greater sustainability. But we are not just part of the solution with our products. Chemical production is very energy intensive and associated with significant CO2 emissions. Our contribution to a successful Green Deal must also include an additional meaningful reduction in CO2 emissions. This poses an enormous technical challenge for our industry.
The good news is that BASF has a plan for this And we've been working on the implementation for quite some time. 1 month ago, we presented our ambitious CO2 goals to the public. By 2,050, we want to make BASF climate neutral. And even more importantly, what can be achieved already by 2,030? By 2,030, we want to reduce our CO2 emissions by 25% compared with 2018 levels.
At the same time, we expect considerable production growth during this period. This means that By 2,030, we will reduce our global CO2 emissions by 60% compared with 19 90 levels. We will thus exceed the EU target and we'll comply with the Paris Climate Agreement.
BASF
Climate change requires decisive action from all of us. Our good news is we've made great technological progress. We can reduce our emissions faster than we previously expected. That's why we've committed to these 2 new targets. We already know that they will be very challenging for us.
After all, we've already reduced our CO2 emissions By half since 1990 while doubling our production. During this time, we've done a lot to improve energy efficiency. We've continuously refined our plans and processes. This potential is now exhausted and we are reaching the technical limits. That's why we need completely new technologies and processes.
We are working on these A climate neutral chemical industry will only be possible with a sufficient supply of renewable energies or More precisely, sufficient electricity from renewable sources. We are talking here about the electrification of the chemical industry. Our electricity demand will increase dramatically and consider as well all the other energy intensive industries and e mobility. Then it becomes clear, a massive expansion of renewable energies across Europe is required. Offshore wind parks play a key role here.
They can supply the electricity volumes for industry and at attractive prices. Germany must become competitive in terms of the prices for renewable energies. Currently, we are not. Electricity tax, renewable energy levies, grid fees and other charges are driving costs unnecessarily high. Our international competitors have an advantage here.
We need electricity prices to be less than €0.05 per kilowatt hour. This is equal to the cost of production. We need an electricity market without public subsidies, but also without charges. With an electricity price of less And €5 we'll be able to do both pay for the transformation of our industry and remain competitive on the global stage. What else is important?
We need to finally see some progress in grid expansion in Germany and in Europe. Our expectation is policymakers quickly forge ahead with this expansion and reduce unnecessary cost burdens. And we, the industry, will invest in new capacities for renewable energy and new technologies for electrification. We need to connect climate, energy and industrial policies. This will secure jobs and prosperity in a sustainable way.
This is essential for public acceptance of climate protection. You're probably wondering what will BASF do with all of Let me give you two examples from our carbon management program. The first example is hydrogen. We produce large volumes of hydrogen in Ludwigshafen alone more than 250,000 metric tons per year. This production causes significant CO2 emissions around 10 metric tonnes of CO2 per tonne of hydrogen.
How can hydrogen be produced with fewer emissions? To do this, there are 2 possible sources, water or methane. The letter is better known as natural gas. If the molecules are split using electricity from renewable sources, It is possible to produce hydrogen with 0 emissions in both cases. Politicians are vigorously promoting the development of water electrolysis.
Our experts are additionally developing methane pyrolysis. It has one major advantage. It requires only 1 5th as much electricity as water electrolysis, which is an important argument, especially as long as renewable energy is in short supply. Moreover, this process can deliver hydrogen at significantly lower costs. We just started up a pilot plan And this shows how important technology openness is.
My second example is the electrification of our steam crackers. We use them to produce basic chemicals. These plants have giant furnaces where the chemical reaction takes place at temperatures of 8 50 Degrees Centigrade. To heat the furnaces we've been using natural gas which emits a lot of CO2. In Ludwigshafner alone, the figure is 1,000,000 metric tonnes of CO2 per year.
We want to change this With electrically heated furnaces. We want to replace natural gas with electricity from renewable sources. Then the process can be carried out without CO2 emissions in normal operations, which is not easy to do. Together with our partners, Saabik and Linde, we developed a technology. We want to use it to retrofit 1 furnace at our cracker in Ludwigshafen Our approximately 10,000 employees in R and D are paving the way here.
Around the globe, they are working on new solutions. At BASF, they can rely on the largest platform for innovations in the chemical industry. You are surely asking yourselves how will BSF remain profitable while investing more in climate protection. You know our accelerator products. They are products that make a substantial contribution to sustainability compared to competitors.
These products have higher growth rates and a higher profitability. We therefore want to increase our sales with these products. Our target is €22,000,000,000 in 2025. To put this in perspective, our Accelerator sales influencing purchasing decisions. This is also true for our customers.
They are increasingly asking us to reduce the carbon footprints of BASF products for them. We are therefore providing transparency about the CO2 emissions of our products. We are the 1st company in the chemical industry worldwide to present our customers with a carbon footprint for all of our 45,000 sales products. To do so, we've developed our own digital solution. We can use it to determine the total value of CO2 emissions for our products.
The value includes all emissions from cradle to gate. We thus combine sustainability and digitalization in an innovative offering. This in turn helps our customers with their own carbon footprints. But consumers also need to be willing to pay more for products With smaller carbon footprints. After all, industry must invest in new processes and plants.
And the operating costs for new CO2 free technologies are higher. But the demand exists In all customer industries, over time consumers will increasingly purchase CO2 reduced products and pay more for them. We're already seeing this with food and its sugar content. Also here, it all Started with transparency about the ingredients. Step by step, we are reducing the carbon footprint of our products.
In doing so, we are closely working together with our customers. We respond to their plans and expectations, and We are doing this in a number of ways. Our Circular Economy program also makes a contribution. With this program, we decouple economic growth from resource consumption. We thus conserve the limited resources on our planet and use them efficiently.
In some ways, we've been doing this for a long time. In our Verbund, we reutilize byproducts and waste, But we can even become better. In the long run, we are striving towards a carbon neutral circular economy. By 2025, we plan to transform 250,000 metric tonnes of recycled and waste based Raw materials into new products each year. By 2,030, we want to increase our sales generated by solutions for the circular economy by 2 €17,000,000,000 which would be doubling today's level.
Dear shareholders, we support the objectives of the Green Deal. It can be a major opportunity for Europe and for our industry. The right conditions will be decisive, however. In this area, the United States and China are putting their focus on funding and supportive measures. This is how they are Effectively promoting the transformation of industry.
We are concerned about some of the developments in Europe. Europe already has the most comprehensive chemicals policy worldwide. We must not abandon established principles and regulations. Cooperation between policymakers, business, industry and society. We need to be open to new things and boldly tackle challenges.
We need support for new technologies and more renewable energy at competitive prices. With this kind of fundamental approach, we will For the future of Europe, this combination would be ideal. To finish up, let's Take a look at the year 2021. What do we expect? We expect the global economy to recover from its slump.
It is forecast to grow by 5% compared with the previous year. Industry is also expected to grow again compared with 2020. We expect a significant uptick in the automotive industry, for example. We likewise anticipate 5% growth in global chemical production. This will be considerably higher than the level of the previous year.
However, there are still significant uncertainties. The pandemic is not yet over and our forecast takes this into account. Since global economic activity has recovered more Strongly than we previously forecast, we've raised our sales and earnings outlook published in February. For 2021, we now expect sales of between €68,000,000,000 €71,000,000,000 And we anticipate EBIT before special items of between €5,000,000,000 5,800,000,000 Overall, we are in a good position. Together with our customers, we want to grow profitably And sustainably in 2021.
We look confidentially into the future. And Finally, let me also take a look into the past. BASF's founder, Frederik Engelhorn, would have turned 200 On July 17 this year, he was a courageous entrepreneur, a visionary full of energy and ideas. Frig Engelhorn overcame the challenges of his time. He was firmly committed to innovation.
Dear shareholders, I said it a year ago and I expressed this again with A lot of hope today. I look forward to seeing you again at Rosengarten Congress Center. Thank you very much for your support and your trust.