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Egypt Environmental Export Market Plan
Chapter 6-Environmental Consulting Services

As the Egyptian Environmental Affairs Agency (EEAA) continues to establish an environmental regulatory structure and begins to address the most pressing environmental problems, the demand for environmental consulting services is expected to grow.

Environmental Impact Assessments

The 1994 Law for the Environment (Law 4/1994) established the need for environmental impact assessments (EIAs). As noted in chapter 2, the 1997 EIA Guidelines define three categories of projects according to the significance of the project's impact on the environment: “white,” “gray,” and “black.” Table 11 lists the “black” projects that require a full-scale EIA. The competent administrative authority is responsible for reviewing the EIA in consultation with the EEAA. Given the recent publication of the guidelines, the market for EIAs is just emerging. About 60 EIA reports are submitted by industries each month, of which about 15 percent (about eight per month) are full EIAs for “black” projects. The cost of conducting an EIA ranges from $1,500 for a very basic study to tens of thousands of dollars.

The principal market for contracting of EIA studies is represented by coastal resorts, power plants, and other energy projects. For example, over the next ten years, hotel capacity on the Gulf of Aqaba coast is planned to increase from the current 15,000 beds to nearly 60,000 beds in 2002 and over 90,000 beds by 2017. During this period, the EIA process will be required of tourist establishments as a preventive measure to ensure conservation of marine (coral reef) and land biodiversity. For U.S. companies, the most viable opportunities lie in large projects sponsored by multinational firms, for which special expertise is not locally available.

ISO 14001 and Environmental Management Systems

The EEAA, through its industrial pollution prevention and abatement programs, encourages industries to establish environmental management systems (EMSs) as a foundation for sound environmental performance. Egyptian industries are beginning to factor environmental considerations into their overall business strategies. These moves are prompted in large part by the fairly recent surge in interest in ISO 14001, Eco-Management and Audit Scheme, and BS 7750, international standards that must be met for companies to export their products. To meet environmental goals, more companies are establishing EMSs and seeking certification. ISO 14001 is a series of standards developed by the International Standards Organization (ISO) to provide business with a structure for managing environmental impacts. It is the only standard in the series that is intended to be used for third-party certification. ISO 14001 was approved by the international body in 1996. The first factory in Egypt to be certified under ISO 14001 was an Indian-owned carbon black plant.

The industrial sectors most likely to pursue ISO 14001 certification will be those whose primary market is exports to Western Europe. The market for ISO 14001 certification is still small. According to the EEAA, less than ten industrial facilities in Egypt have been certified. However, there is a clear interest in developing environmental management systems at industrial plants. Under the U.S. Agency for International Development's (USAID’s) Environmental Pollution Prevention Project, USAID has funded several ISO 14001 training courses for industrialists. Attendees included representatives from textile plants, chemical plants, metal-finishing plants, and food-processing plants.

Table 11: Projects Requiring a Full EIA Competent

Competent Administrative AuthorityProject TypeProduction Capacity/Proj. Size Threshold
Ministry of IndustryIron and steel factories>150 tons per day
Electroplating factories>25 tons per day
Cement factories: dry process
wet process
>100 tons per day
>50 tons per day
Mining projects>1,500 acres
Chemical plants (e.g., fertilizer, pharmaceuticals, paint, soap and detergent)>50 tons per day
Pesticide manufacturingAll
Pulp and paper plants>500 tons per day
Textile dyeing>10 tons per day
Leather tanneries>1 million ft2/year or 750 hides/day
Lead smeltersAll
Vegetable oil refiningAll
Ministry of PetroleumOil and gas exploration and productionAll
Offshore and onshore pipelines>50 km
Oil and gas separation, processing, handling, and storage facilitiesAll
Petroleum product storage facilities>15,000 m3
Mineral oil refineries and petrochemical industryAll
Ministry of Electricity and EnergyThermal power plants>30 megawatts
Nuclear power plantsAll
Intercontinental transmission linesAll
Hydropower plantsAll
Ministry of TransportMass transit systems and expressways, including bridges and tunnels50 km
Commercial airports and runway extensions>15,000 m
Railway lines>50 km
Ministry of Maritime TransportPorts>25 deadweight tons
Extensions of existing portsAll
Ministry of TourismHotel or resorts in environmentally sensitive, culturally or historically significant areasAll
Ministry of Public Works and Water ResourcesNew irrigation projects including dams and barragesAll
Ministry of AgricultureLand reclamation projects>400 acres
Ministry of Housing, Utilities, and New CommunitiesWastewater treatment plants>1 million person equivalents
Source: Egyptian Environmental Affairs Agency, Guidelines for Egyptian Environmental Impact Assessment, 1997.

Laboratory and Monitoring Services

Laboratory resources remain, for the most part, in public-sector companies and centers attached to government ministries. An example is the Environmental Monitoring and Occupational Health Center, created in 1983 with the Ministry of Health with World Health Organization assistance. The center maintains both a water pollution analytical lab and an air and radiation lab, contracting with private developers to perform baseline environmental quality studies as part of EIAs. Within the Ministry of Housing, Utilities, and New Communities, the National Organization for Potable Water and Sanitary Drainage performs wastewater quality analyses for public-sector wastewater authorities and private industry. Other laboratories have been established in technical universities. The EEAA has plans to establish a reference laboratory as well as laboratories at each of its future regional branch offices.

It is expected that with the implementation of the Law for Environment (Law 4) in 1998, demand for laboratory and monitoring services will take off. Law 4 requires all industries to maintain a “Register of Environmental Impacts” containing data on all waste discharges (air emissions, wastewater, and solid and hazardous waste). Multinational companies or those that export to Europe are likely to be the first to comply with the new requirements.

Policy Development and Institutional Strengthening

Because of the large influx of donor-funded environmental projects and the common importance of environmental policy and institutional development to USAID and other donors, there is a considerable market for such services as legal and regulatory development; organizational development; data and information management systems; and training in permitting, compliance monitoring, and enforcement. The principal target of these projects is the EEAA, although USAID and other donors have also extended services to water and wastewater utilities, other government ministries, governorates, and some municipalities.

Under the new Egyptian Environmental Policy Program which began in 1998, USAID and Egypt will provide $50 to $70 million in technical assistance over the next five years. The USAID-funded Environmental Sector Assessment lists 55 separate initiatives under the following waste management, renewable energy and energy efficiency, and environmentally sustainable tourism. These projects will be implemented by U.S. companies through new or existing USAID contracts.

Other Environmental Services

In addition to demand for EIAs, environmental management systems, and certification services, demand for environmental consulting will increase in such areas as the following:
Table 12: Donor-Funded Technical Assistance Projects Funding
($US millions)
Environmental Impact Assessment
British Department for International Development(DFID) capacity Building in EIA and Industrial Auditing Outside EEAA2.11995-1998Services focus on other line ministries with responsibilities under the EIA program.
Monitoring and Information Systems
Canadian International Development Agency (CIDA)Environmental Information Systems Design and Implementation9.31996-2002Develop an action plan for EEAA information needs; develop an operational Global Information System; integrate up to 7 Government of Egypt agencies in the water sector in one environmental information system; train staff; develop a documentation center.
CIDANational Water Quality and Availability Program14.51996-2003Improve water quality testing and availability management systems.
Danish International Development Agency (DANIDA)Environmental Information and Monitoring Program13.31996-2000Monitor air and coastal waters nationally.
Japanese International Cooperation AgencyLaboratory Network for EEAA Regional Offices6.01996-1999Provide equipment for water and air monitoring systems in eight EEAA minilaboratories.
Pollution Prevention Assessments
CIDAEnvironmental Technology and Management Fund14.71995-2000Support the private sector in developing "green" businesses.
DANIDAPollution Prevention Project at the Kima Fertilizer Factory, Aswan9.01998-2000Develop a Cleaner Production and Integrated Development Action Program to achieve regulatory compliance.
U.S. Agency for International Development (USAID)Energy Conservation and Environmental Project/Environmental Pollution Prevention Project67.51988-1998Conduct pollution prevention audits, promote cleaner technologies, train in ISO 14001, provide EMSs for new industrial cities.
Policy Develop/Inst. Strengthening
DFIDSupport for Environmental Assessment and Management Project6.41995-1998Prepare governorate environmental action plans and establish environmental management units in Sohag and Dakahlia.
DANIDAEnvironmental Education and Training Program4.61995-1999Train staff at EEAA and sectoral ministries.
DANIDAOrganizational Support Program II2.71997-2000Build institutional capacity of EEAA.
DANIDAEconomic Instruments3.51998-1999Pilot economic incentives to encourage regulatory compliance and environmentally sound practices.
USAIDEgypt Environmental Policy Program240.0
1998-2002Promote policy, regulatory, and institutional reform in the areas of energy efficiency, industrial pollution, solid waste management, and natural resource management.
World BankRed Sea Coastal and Marine Resource Management (TA)5.01995-1998Develop and implement policy, plans, and regulations for coastal zone management.
TA = total allocated

Consulting Services Market Summary

Egypt's market for environmental services is estimated at $60 million. Historically, the largest share of this market (over 80 percent) comes from USAID and other international donor-funded technical assistance projects. Table 12 lists major donor-funded technical assistance projects in Egypt.

The demand for environmental services is growing and is expected to continue. The need for EIAs will continue to dominate the commercial market. As regulations for air, water, and hazardous waste are promulgated and more strictly enforced, industries will require consulting services to help them meet these new requirements. ISO 14001 and other certification programs will gain popularity among private Egyptian companies, particularly those exporting to European markets. Companies providing consulting services should be fully versed in EMS practices and certification requirements. Several U.S. companies are well established in the Egyptian market but continue to face competition from European firms.

Environmental Consulting Services

Market Size: $60 million.
Best Prospects: EIAs, EMS development, policy development, and institutional strengthening.

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