Environmental Technologies Industries

Environmental Technologies Industries

Market Plans

Egypt Environmental Export Market Plan

Chapter 3-Water Supply and Wastewater Treatment

Water supply and wastewater treatment constitute the largest environmental market segment in Egypt. Currently, the Nile River is the source for more than 95 percent of the country's water, supplying a large population, a burgeoning industrial base, and over 7 million acres of highly productive irrigated lands. The Nile is also the ultimate recipient of Egypt's wastewater. A rapidly expanding population and the disposal of untreated wastes are putting increased demands on the country's water supply. These demands are threatening the country's capacity to supply good quality water and preserve the potability of its waterways.

The traditional concern with securing sufficient Nile water for Egypt's survival and economic development cannot be overemphasized. At the same time, uncontrolled wastewater discharges are causing immediate and long-term health impacts on the population. The World Health Organization has estimated that over 90,000 Egyptians, mostly children, die each year from contaminated water.

Municipal Water Supply and Wastewater Treatment

Water Supply

Although 78 percent of Egypt's population have access to treated drinking water, only 50 percent of the rural population do, and treatment is very basic throughout the country. Only large cities such as Cairo and Alexandria provide treated drinking water to all their residents. The quality of raw water, especially in rural areas, is low. For example, in the Nile Delta, the source of water for Alexandria, there are problems with total dissolved solids. To treat water, existing surface water filtration plants in Egypt use conventional processes consisting of pre-chlorination, aluminum sulfate coagulation/flocculation, sedimentation, rapid sand filtration, and postchlorination.

Municipal water supply is often unreliable, particularly in rural areas. Distribution systems cannot satisfy peak demands, and in some cases, water has to be rationed. To obtain adequate supplies, residents are forced to find alternatives such as purchasing bulk water from street vendors or carrying water from nearby buildings, street standpipes, or water supply canals.

Reclamation of desert land, installation of new sewer and potable water systems, and rehabilitation of old water infrastructure are the major priorities of the Government of Egypt (GOE) in the new five-year plan (1997–2002). The GOE expects domestic water supply to reach 88 percent of the population by the year 2000, and 95 percent by 2002. Planned government investment in this sector is $1.5 billion over the next five years.

The projects tentatively approved by the GOE include the following:
Upgrade 1,000 existing compact water treatment units;

Construct 500 new units of 2,000 to 5,000 m 3 /day capacity;
Upgrade 26 existing water treatment facilities, including major rehabilitation and repairs;
Upgrade 150 facilities for readiness to be operated on contract by the private sector;
Construct 12 new facilities for the new cities through build-operate-transfer arrangements; and
Install iron and magnesium removal units in rural areas (with 500 to 2,000 m 3 /day capacity).

The GOE is also taking steps to involve the private sector in providing drinking water to the population. In a village of 5,000 inhabitants with no centralized drinking water supply, a private company was contracted to purify water and sell it in bottles at $2.50 per cubic meter, which covered capital and operating costs. This practice is likely to expand across the country.

Municipal Wastewater Treatment

Approximately 40 of 60 Egyptian cities have sewerage systems connected to existing (or under construction) primary or secondary treatment plants. These systems provide 70 percent of the urban population with access to some kind of sanitation services. However, 85 percent of the total load of municipal sewage systems receives little or no treatment. In rural areas, an estimated 94 percent of the population does not have access to either sewer systems or treatment facilities. The rural population disposes sewage on-site into leaching pits, septic tanks adjacent to houses, or directly into drains and canals. Groundwater often infiltrates the leaching pits, and this groundwater is then used as drinking water in rural communities.

Municipal Water Supply and Wastewater Treatment

Market Size: $480 million.
Best Prospects: water and wastewater treatment systems, water pumps and pumping stations, compact treatment units, pipes.

Untreated sewage from donkey carts, dumping, vacuum trucks, and treatment plant overflows creates a threat to public health and the environment. The harmful impact of Alexandria's sewage on Lake Maryut is so visible that it has attracted a good deal of media attention. The practice of disposing wastewater into drains that ultimately empty into the Delta lakes or into the Nile itself damages surface water quality and natural habitats.

Domestic wastewater is the primary source of Egypt's water quality problems. The GOE anticipates that wastewater treatment services will cover 60 percent of the population in 2002, an increase from the present 33 percent. The GOE has allocated $314 million for municipal wastewater treatment systems in Cairo, Alexandria, and other governorates over the past three years. To cover an additional 17 percent of the rural population with wastewater treatment services, 400 to 600 compact units, each with a capacity of 500 to 2,000 m/day, need to be supplied over the next four years.

One of the necessary conditions for achieving the GOE’s water supply and wastewater treatment goals is continued extensive involvement of the U.S. Agency for International Development (USAID), the single largest donor in Egypt for urban wastewater treatment projects in large and medium-sized cities. USAID assistance in the water and wastewater sector is focused on urban centers of production and population growth where water and wastewater problems are most critical. USAID provides funds for additional infrastructure construction and rehabilitation as well as for institutional reforms to ensure financial viability and institutional autonomy of Egypt's water and wastewater utilities. Table 4 highlights the major donor-funded projects in the municipal water supply and wastewater treatment sector.

Table 4: Ongoing Donor Projects in the Municipal Water and Wastewater Sector

Donor	Project	Funding ($US millions)	Duration	Description
Danish International Development Agency	Esna Water Supply and Sanitation Project, Qena	35.0	1997–2002	Engineering and construction.
France	Construction of Beni Suef Drinking Water Treatment Plant	12.0	1996-	Engineering and construction.
France	Upgrade of Tenth of Ramadan Drinking Water Treatment Plant	15.0	1996-	Engineering and construction.
France	Upgrade of Gabel El Asfar Wastewater Treatment Plant, Cairo	68.0	TBD	Engineering and construction.
KfW (Germany)	Kafr El Sheikh Sewerage Project	48.0	1998-2003	Collect and adequately treat wastewater in about 50 villages of the governorate.
KfW (Germany)	Upgrade of Amriya Wastewater Treatment Plant, Alexandria	32.7	1998-2000	Engineering and construction.
KfW (Germany)	Improvement of Water Supply and Sewage Systems in Ezbeth Bekhit, Greater Cairo	4.8	TBD	Engineering and construction.
Netherlands	Fayoum Drinking Water and Sanitation III	6.4	1997-2000	Engineering and construction.
United Nations Development Project	Engineering Wetland at Lake Manzala	4.5	1997-2001	Establish an engineered wetland as a demonstration of a low-cost technology for treatment of large quantities of wastewater of mixed industrial, municipal, and agricultural origin.
United Nations Children's Fund (UNICEF)	Integrated Water, Sanitation, and Environment Project	3.6	1996-2000	Administer small-scale water supply and sanitation systems in one village in each of the four governorates in Upper Egypt.
USAID	Alexandria Wastewater System Expansion II	250.0	1998-2002	Improve sewage collection and treatment.
USAID	Canal Cities II	380.0	1987-1999	Further improve delivery of water and wastewater services in the cities of Port Said, Ismailia, and Suez.
USAID	Secondary Cities Development	215.0	1994-2002	Develop water supply and waste-water treatment systems in the cities of Mansoura, Sharm El Sheikh, Nuweiba, Luxor, and Kom Ombo-Darao-Nasr.
USAID	Alexandria Drinking Water	200.0	1998-2002	Improve drinking water supply and treatment.
USAID	Institutional Strengthening: Middle Egypt Utilities	8.0	1998-2002	Increase access to sustainable water and wastewater services in the governorates of Fayoum, Beni Suef, and Minia.
USAID	Energy Utility Management Project	315.0	1997-2004	Expand access to water and wastewater services by developing water supply and wastewater systems in the cities of Fayoum, Beni Suef, and Minia, and improve the infrastructure of the Alexandria Water General Authority.

TBD — to be determined

The World Bank has recently launched a Middle East and North Africa Water Partnership program designed to energize and harmonize government and donor efforts in the water and wastewater sector. Ultimately, the program will increase overall investment in this sector by 200 to 300 percent. The program will facilitate investment from government, donor, and private-sector sources for rehabilitation and expansion of water distribution and transfer networks; expansion of wastewater collection and treatment systems; and protection of water quality.

There are opportunities in the municipal wastewater market for foreign companies involved in environmental engineering and design of new treatment systems; sales of equipment for pump stations and wastewater treatment plants; and possibly, operation and maintenance contracts for secondary treatment facilities. For joint ventures between foreign and local companies, there are opportunities to construct or expand new sewerage systems, to manufacture and sell components for compact wastewater treatment facilities, and to manufacture and sell polyvinyl chloride pipes and valves. There may also be opportunities for the operation and maintenance of existing water and wastewater facilities.

Egypt is one of the largest water-pump markets in the world. Imports of water pumps in Egypt totaled $50 million in 1996, and the market is expected to grow over the next five years by 15 percent annually. Water pumps are primarily used by public- and private-sector industrial concerns, municipal authorities, and the agricultural sector. The public sector's market share of imported water pumps is 70 percent. In the water and wastewater market, the best sales prospects for pumps are for horizontal end-suction water pumps, split-case water pumps, and feed-water boiler pumps.

Another attractive business opportunity in this market segment is the sale of compact water treatment units, air blowers, filters, boosters, chemicals, pipes, valves, and turbines.

U.S. companies have a lead in the municipal water and wastewater sector with an import market share of 40 percent. French firms are the main competitors of U.S. suppliers of water supply equipment, while British companies have a high profile in the municipal wastewater treatment market. Companies active in this market segment include from the United States, Camp Dresser & McKee, CH2M Hill, Metcalf & Eddy, Montgomery Watson, Black & Veatch, Harbert Jones, Fru-Con, Morrison Knudsen, and ABB-SUSA; from France, Degremont and Guinard; and from the United Kingdom, Cairo Wastewater Consortium.

Industrial Wastewater Treatment

Industrial wastewater discharges are considered one of the major sources of water pollution in Egypt. It is estimated that Egypt's 314 major public-sector industries discharge approximately 335 million m 3 /year of industrial wastewater. Of this amount, Greater Cairo discharges 130 million m 3/year, while Alexandria is responsible for 90 million m 3/year. The 10 largest wastewater producers in these cities are discharging a total of 100 million and 65 million m 3/year, respectively, or nearly half the total volume for the entire country. Table 5 summarizes industrial wastewater discharges for the largest categories of public-sector facilities in Egypt.

Table 5: Industrial Wastewater Discharges of Major Public-Sector Industries, 1990

Industry Sector	Number of Facilities	Wastewater Discharges (millions m3/year
Chemicals	35	42
Fertilizers	6	46
Metals	15	93
Oil and Soap	35	59
Pulp and Paper	11	41
Sugar	13	136
Textiles	72	81
Other	134	42
TOTAL	321	540

Source: Environmental Policy and Institutional Strengthening Indefinite Quantity Contract, 1997

The major wastewater discharging industries in Greater Cairo are metallurgical (Delta Steel, Egyptian Iron and Steel, and National Metals), sugar (Egyptian Sugar and Integrated Industries) and chemical (El Nasr Coke and Chemicals). Shoubra El Kheima, north of Cairo, has one of the highest concentrations of industry in Egypt. There, metal foundries produce almost 50 percent of the total wastewater volume, and the textile industries contribute almost 52 percent to the bacterial oxygen demand load. In Alexandria, industrial and commercial establishments contribute 46.7 percent of the city's total organic discharge load. Two pulp and paper plants (Rakta and National Paper) are the main water polluters. Other large sources of wastewater discharges in Alexandria are the chemical, metallurgical, and textile industries.

Industrial Wastewater Treatment

Market Size: $70 million.
Best Prospects: filters, membranes, evaporators, clarifiers, flotation systems, reverse osmosis systems.

Industrial wastewater is either discharged directly into the waterways (e.g., in the cities of Suez, Port Said, Ismailia) or through municipal systems which discharge into the Nile and its canals. Over 80 percent of industrial discharges do not receive any treatment. Industrial wastewaters dumped into public sewers without pretreatment cause damage to sewerage systems through corrosion or by inhibiting biological processes.

The market for industrial wastewater control equipment is driven by two factors: First, the approaching deadlines for compliance with Law 4/1994 requirements. This law forces industries, especially private firms in new industrial cities (e.g., Tenth of Ramadan and Sixth of October), to buy wastewater treatment installations. Second, the market is driven by donor funding and financing. Most of the money for imports of U.S.-manufactured industrial wastewater treatment equipment is likely to come from Egyptian private-sector industries, since grants are generally not available in this market segment. Projects such as the KfW-funded Private Sector Industry Support Program and Environmental Protection Fund (see table 6) will make these imports more affordable for local industries.

Table 6: Donor Projects in the Industrial Wastewater Sector Funding

Donor	Project	Funding ($ millions)	Duration	Description
KfW (Germany)	Program Support to Private-Sector Industry and Its Environmental Protection*	46.0	1995–1999	Provide medium- and long-term financing to private-sector industry to cover (1) imported equipment for modernization, (2) up to 50 percent of costs of environmental measures, and (3) costs of environmental audits and assessments.
KfW (Germany)	Ductile Iron Pipes Plant (El Nasr Castings)*	6.5	1998–2000	Reduce air and water pollution from casting operations.
KfW (Germany)	Environmental Protection Fund (Public-Sector Industry)*	16.5	1997–2001	Finance up to 50 percent of investments in environmental improvements in public-sector companies, concentrating on wastewater treatment.
World Bank	World Bank Egypt Pollution Abatement Project*	50.5	1997–2002	Support pollution abatement investments in Greater Cairo, Alexandria, Suez, and Ismailia

* Included in “donor projects” found in other chapters.

The World Bank has established the $39 million Pollution Abatement Fund (PAF) under the Egypt Pollution Abatement Project to finance environmental investments through local commercial banks. To qualify, Egyptian firms must be financially viable existing public and private enterprises. Projects eligible for PAF funding are investments in pollution prevention and effluent pretreatment.

The biggest opportunities in industrial wastewater treatment will be in food processing (sugar, edible oils, onion dehydration), cement, steel and iron, chemicals and fertilizers, and textiles, especially at factories located along the Nile River.

In the short term, demand will be for unsophisticated technologies that treat the most obvious pollutants and are easily operated and maintained. process changes, improved housekeeping, and water conservation and reuse will be priorities. In addition, some of the existing systems are not in working condition because of a lack of spare parts and trained operators, which creates a market for spare parts and consulting services.

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