BASF Report 2021 Management’s Report – Material Investments and Portfolio Measures 38 Material Investments and Portfolio Measures In addition to innovations, investments make a decisive contribution toward achieving our ambitious growth and climate protection goals. We use targeted acquisitions to supplement our organic growth. Our focus is on innovation-driven growth areas and sustainable technologies. With a world market share of over 45%, China is already the largest Additions to property, plant and equipmenta by segment in 2021 At a glance chemical market and will drive growth in global chemical production to an even greater extent in the future. We expect China’s share to 28% 16% €3.4 billion €25.6 billion increase to over 50% by 2030. To further strengthen our position in Chemicals Nutrition & Care Capex1 in 2021 Capex planned for 2022 to Asia, we plan to build a new integrated Verbund site in Zhanjiang 2026 €4,078 million 8% in the southern Chinese province of Guangdong. The first plants 17% Agricultural Solutions started construction in 2020, and we made further progress on Materials these in 2021. They are scheduled for startup in 2022. We will 4% 9% Others (infrastructure, R&D) By investing in our plants, we create the conditions for the profitable also expand the Verbund site we operate together with Sinopec in Industrial Solutions growth we strive for and continuously improve the efficiency of exist- Nanjing, China, by 2023. 18% ing production processes. Investments in new technologies and in Surface Technologies the transformation of our energy supply will help to achieve our In addition, we are refining our portfolio through acquisitions that growth targets and our ambitious climate targets. For the period promise above-average profitable growth as part of the BASF Ver- 1 from 2022 to 2026, we are planning capital expenditures (capex) bund to help reach a relevant market position. A key consideration totaling €25.6 billion, including €12.9 billion for our major growth is that these are innovation-driven or offer a technological differen- projects.2 tiation, and make new, sustainable business models possible. Additions to property, plant and equipmenta by region in 2021 For more information on our investments from 2022 onward, see page 150 Investments and acquisitions alike are prepared by interdisciplinary 2% teams and assessed using various criteria. In this way, we ensure South America, Africa, Middle East Investments and acquisitions 2021 that economic, environmental and social concerns are included in Million € strategic decision-making. 24% Invest- Acquisi- Asia Pacific €4,078 million 53% ments tions Total Europe Intangible assets 78 392 470 21% Investments in the segments and regions of which goodwill – 254 254 North America Property, plant and equipmenta 4,078 332 4,410 Investments in property, plant and equipment amounted to a Including restoration obligations, IT investments and right-of-use assets arising from leases Total 4,156 725 4,881 €4,078 million in 2021 (2020: €3,516 million). Capex accounted for a Including restoration obligations, IT investments and right-of-use assets arising from leases €3,363 million of this amount (2020: €2,878 million). Our invest- ments in 2021 focused on the Chemicals, Materials, Surface Technologies and Nutrition & Care segments. 1 Additions to property, plant and equipment excluding acquisitions, restoration obligations, IT investments and right-of-use assets arising from leases 2 Major growth projects are the construction of our future Verbund site in Zhanjiang, China, as well as our battery materials activities.