Environmental Technologies Industries

Environmental Technologies Industries

Finance

Aid to Trade

Chapter 3 - Strategies for U.S. Firms to Take Advantage of Opportunities Created by U.S. Foreign Assistance

This chapter is designed to help U.S. environmental technology companies develop market strategies to take advantage of U.S. bilateral aid. It describes sources of information on procurement opportunities under environmental assistance programs, guides businesses to relevant U.S. technology promotion initiatives, and recommends a step-by-step process that U.S. companies may follow to enter and compete in developing country markets created or enhanced by U.S. foreign assistance.

Information Resources on USAID Projects and Procurement Opportunities

The U.S. Agency for International Development (USAID) represents the single most important U.S.
Government catalyst for opportunities for U.S. exporters of environmental technologies, both in terms
of direct procurement and strategic marketing related to environmental assistance projects.

USAID commodity procurement includes equipment and supplies to meet USAID project needs, and provide disaster relief, as well as materials financed through USAID-funded commodity import programs. Procurement is usually done by USAID Missions in the field for projects with a value of over $1 million. USAID procurements provide an important opportunity for U.S. companies interested in positioning themselves in specific overseas markets.

USAID advertises procurement opportunities through the following information sources:

• Commerce Business Daily (CBD): The CBD includes announcements about all USAID commodity procurement opportunities and technical assistance projects with a value greater than $100,000. Contact the U.S. Government Printing Office at 202-783-3238 to subscribe to the print version or contact the U.S. Department of Commerce at 202-482-0632 for the electronic version.

• Procurement Information Bulletin (PIB): The PIB lists USAID commodity procurement opportunities and awards greater than $25,000. Written requests to receive the PIB should be faxed to USAID’s Office of Procurement at fax 202-216-3051 or telephone 202-712-5130.

• Internet and phone inquiries: USAID posts information on planned procurements as well as currently issued Requests for Proposals (RFPs) on its website (www.info.usaid.gov). Procurement information can also be obtained by calling 1-800-USAID-73.

Since contract awards over $100,000 are very competitive, a company should be economically sound and knowledgeable about procurement rules and regulations before attempting to bid on projects. It is very important to become familiar with the Federal Acquisition Regulations (FARs) and USAID Acquisition Regulations (AIDARs). These publications are available in most public libraries, or can be ordered from the U.S. Government Printing Office.

USAID is most likely to procure environmental equipment through big contracts awarded to consortia of environmental engineering and consulting firms. The equipment supplier would then need to become a subcontractor to the project’s prime contractor. Prime contractors must follow a formal bidding process in equipment procurement. Names, types of businesses, and subcontracting needs of USAID’s prime contractors can be obtained from the Contract Awards section of the CBD; USAID lists of prime contractors are available through the Information Center at 202-712-4810; and federal prime contracting reports are available from the Federal Procurement Data Center at 202-401-1529. Obtaining information on past awards, quantities, costs, and awardees may also be helpful.

USAID puts special emphasis on involving U.S. small and medium-sized enterprises (SMEs) in its
technology transfer efforts. The Office of Small and Disadvantaged Business Utilization (OSDBU) is the initial point of contact at USAID for U.S. small businesses. OSDBU is a small business advocacy and advisory office with the responsibility for ensuring that these enterprises get access to USAID programs. OSDBU
• Serves as an information clearinghouse for U.S. small businesses;
• Counsels small businesses on how to do business with USAID;
• Reviews all prime contracts to identify subcontracting opportunities for small businesses;
• Maintains the Vendor Database, which describes the capabilities of U.S. businesses and organizations interested in participating in the agency’s programs;
• Sponsors annual outreach conferences on “How To Do Business with USAID”; and
• Develops operations, systems, and procedures to optimize participation of U.S. small businesses
in USAID activities.

Even if direct procurement is not part of a significant technology-related USAID project, suppliers in the relevant technology area can benefit from learning about the project to identify potential markets in the target country. Environment: A Resource Guide provides a good overview of USAID’s principal programs and contracts.

U.S. Foreign Assistance Programs Promoting U.S. Environmental Exports

A significant share of U.S. foreign assistance resources is dedicated specifically to promoting U.S.
environmental technologies overseas. The main U.S. Government agencies involved in this effort are USAID, U.S. Environmental Protection Agency (EPA), U.S. Department of Commerce (DOC), and U.S. Trade and Development Agency (TDA). Their relevant programs are described in this section.

USAID Technology Promotion Programs

Global Technology Network. USAID Global Bureau’s Office of Business Development serves as the central point of contact at USAID for U.S. firms interested in doing business in developing countries. Its activities and services are specifically intended to increase U.S. private enterprise participation in USAID international development programs while opening up new market opportunities for U.S. product and services firms, especially small and medium-sized firms. The Office of Business Development operates regional Business Outreach Offices that provide links to market opportunities in USAID-assisted countries worldwide. They also serve as a source of public information regarding the purpose and impact of U.S. foreign assistance.

The Global Technology Network (GTN) is the principal program of the Office of Business Development. GTN is a free service that creates strategic linkages between U.S. companies and entrepreneurs in developing countries with the goal of transferring U.S. technology overseas. GTN’s environmental and energy services assist the U.S. business community in gaining access to global environmental and energy markets by providing trade leads and market information. In 1998 and 1999, GTN generated over 2,500 trade leads resulting in 60 deals valued at more than $230 million.

The three basic types of leads are equipment purchases, agent/distributor, and joint ventures. Business opportunities are identified by a network of participating in-country public and private sector representatives. Leads are transmitted to GTN/Washington where they are qualified, matched, and electronically disseminated to U.S. firms registered in GTN’s databases. Over 10,000 U.S. environmental and energy firms covering over 600 different subsectors within the environmental industry are currently registered in the GTN system. (Companies can register by calling 1-800-872-4348.) To give U.S. companies easier access to GTN business opportunities, GTN is now posting its current trade leads on-line at http://www.usgtn.org/pages/envleads.html.

Follow-up on trade leads, as well as information on general USAID procurement, is provided through GTN’s headquarters in Washington, D.C. and outreach offices in California, Florida, Illinois, Oregon, and Washington (contact information is provided in appendix A). Additional follow-up on leads is provided through U.S. Export Assistance Centers and 26 state trade partner organizations across the United States. Partner organizations use GTN’s Internet-based Trade Lead Tracking System to assist local companies in responding to GTN trade leads.

The GTN Travel Grants program is designed to support U.S. firms pursuing GTN trade leads. After
developing country and U.S. parties have identified a mutual interest in pursuing a business relationship, either organization may apply for a GTN grant for a maximum of $5,000 to cover the travel costs of one individual’s travel to meet with the potential partner. The grants are available for both developing country and U.S. entrepreneurs.

GTN trade mission services, which include sector briefings and networking support to USAID Missions and domestic partners, are provided in cooperation with other federal and multilateral agencies. Trade briefings are held at USAID offices in the Ronald Reagan Building, 1300 Pennsylvania Avenue, NW., Washington, D.C. 20523. GTN also leads overseas trade delegations sponsored by USAID Missions and U.S. embassies abroad, foreign embassies, or other GTN partner organizations.

GTN manages three regional programs:
• GTN-Environmental Technology Network for Asia (ETNA) was developed by USAID’s Global Bureau and the United States-Asia Environmental Partnership (US-AEP) and is described in more detail.
• GTN-Americas is a joint program between USAID’s Global Bureau and the DOC. GTN Americas generates trade leads in Argentina, Bolivia, Brazil, Chile, Costa Rica, Mexico, Peru, Uruguay, and Venezuela.
• GTN-EcoLinks, the Eurasian-American Partnership for Environmentally Sustainable Economies,
is a USAID initiative seeking practical, market-based solutions to industrial and urban environmental problems in Central and Eastern Europe and the New Independent States (CEE/NIS). A more detailed description of EcoLinks is provided on the next page.

GTN also operates in 15 African countries, as well as in Egypt and Jordan.

United States-Asia Environmental Partnership.
The United States-Asia Environmental Partnership is an interagency program with funding of more than $17.5 million from USAID, DOC, and EPA to promote and reinforce a sustainable, cleaner production regime for the industrial and urban sectors in 11 Asian countries: Hong Kong, India, Indonesia, Korea, Malaysia, Philippines, Singapore, Sri Lanka, Taiwan, Thailand, and Vietnam. Since its inception in 1993, US-AEP has facilitated over $1 billion in sales of environmental equipment and services by U.S. companies in Asia.

ETNA Trade Lead Pays Off

The owner of U.S. Environmental Services, Inc. of Willston, Vermont has credited US-AEP’s services for the success of his company’s entry into the Taiwan market. As a result of getting trade leads from ETNA, winning an Environmental Technology Fund grant, and receiving business counseling from US-AEP Technology Representatives, the firm sold $35,000 worth of groundwater remediation technologies to a Taiwanese firm in June 1999 and received orders for $140,000 by July.

The process was long, beginning with the follow-up to an ETNA trade lead in 1996. A key to the success of these initiatives was the translation of business materials into Mandarin through a grant provided by the Department of Commerce.

Source: Update, US-AEP, July 19, 1999.

In cooperation with DOC, US-AEP has placed Environmental Technology Representatives in 11 Asian countries to identify trade opportunities for U.S. companies and coordinate meetings between potential Asian and U.S. business partners. These environmental trade specialists meet regularly with decision-makers in industry and government to prepare concise trade leads that identify Asian buyers, environmental concerns, and proposed technology solutions. Hundreds of such leads per year are forwarded to ETNA, where they are matched against a database of over 2,400 registered U.S. companies, and then faxed to those companies that provide the requested technology or service.

Urban Environmental Infrastructure Representatives, located in four Asian countries (India, Indonesia, the Philippines, and Thailand), provide similar services, but focus on problems found in urban areas, such as the provision of clean water, treatment of wastewater, and disposal of solid and hazardous wastes.

In addition to the trade leads provided by the US-AEP Technology Representatives in Asia, ETNA
provides market trend analyses for each US-AEP country; disseminates fact sheets on innovative U.S. technologies to U.S. Government counterparts overseas (e.g., US-AEP technology representatives and foreign commercial service representatives); and provides business counseling to U.S. environmental companies interested in expanding their business in Asia. Contact ETNA (1-800-818-9911) to find out more about these and other services.

Export-Link ^TM is an Internet resource accessible through the US-AEP website (www.usaep.org) that assists companies with their international trade activities and provides practical assistance to all levels of exporters. Export-Link helps U.S. firms evaluate overseas market opportunities and offers advanced business analysis, as well as relevant legal, financial, and market information.

The Environmental Exchange Program promotes information sharing on a variety of environmental topics to respond to Asian countries’ environmental needs. There are several types of exchanges provided. Environmental Business Exchanges offer American and Asian businessmen an opportunity to travel to each other’s countries to meet with potential business partners. Business exchanges may involve a single individual or a study tour of 10-20 people. Technical Exchanges help representatives from U.S. firms showcase their technology and equipment to Asian decision-makers. Finally, Environmental Fellowships enable American and Asian professionals to work with peers in their counterpart’s home countries for a period of one to four months for training, research, or
information sharing. Interested U.S. businesses should contact the International Institute for Education, which administers the program. Refer to appendix A for contact information.

Drawing on the U.S. states’ expertise in environmental management, the State Environmental Initiative, provides matching grants for up to $150,000 to encourage state initiated and managed programs. The initiative was designed to encourage international partnerships in environment and economic development between U.S. states and Asian/Pacific nations and territories. The grants serve to facilitate the long-term transfer of U.S. environmental experience, technology, and practice to targeted Asian countries by matching appropriate U.S. technologies and state regulatory and environmental experience to Asian interests in environmental solutions. Requests for proposals are issued by the Council for State Governments.

The Environmental Technology Fund is administered by the National Association of State Development Agencies (NASDA) and is described under “NASDA Grants” in this section.

EcoLinks. The Eurasian-American Partnerships for Environmentally Sustainable Economies (EcoLinks) offers resources to providers of U.S. technologies as part of its regional initiative to find practical, market-based solutions to industrial and urban environmental problems in Central and Eastern Europe and the New Independent States. It promotes partnerships linking CEE/NIS businesses, local governments, and associations with U.S. counterparts. EcoLinks actively seeks environmental
business and technology transfer opportunities in the Czech Republic, Poland, Hungary, Romania,
Kazakhstan, Russia, Ukraine, and Macedonia.

EcoLinks technology transfer program operates in the same way as ETNA in Asia. Through an interagency agreement between USAID and DOC, Environmental Technology Representatives have been placed in selected CEE/NIS countries, namely, the Czech Republic, Hungary, Kazakhstan, Poland, and Romania. These representatives work with GTN to generate trade leads.

A second component of EcoLinks is its grants initiative. Competitively awarded, cost-sharing partnership grants are currently available in amounts of up to $50,000 to support one-year cooperative projects, and twining grants (grants that support two-year cooperative projects that lead to lasting partnerships) of up to $250,000 will become available for two-year projects starting in the year 2000.

In addition to the grants, EcoLinks also offers Quick Response Awards (QRAs) to prospective applicants. Awards of up to $5,000 are designed to meet the immediate and small-scale needs of organizations exploring potential partnerships within the framework of EcoLinks. Activities must either facilitate the matchmaking of potential partners or promote environmental trade and investment. Examples of activities funded by the QRA include travel to meet potential partners, site visits to facilities, technology demonstrations, and conferences where participants meet partners and forge relationships.

NASDA Grants. NASDA administers three similar grant programs promoting U.S. environmental technology exports to Asia and Latin America.

NASDA Grant Opens Door to a $5 Million Market

Representatives of Ennix Inc., a U.S. provider of bio-remediation technologies and products for
animal wastes, traveled to Brazil with support from the NASDA Latin America Fund for the Environment to meet with major pork and poultry producers. As a result of these meetings, Ennix sold $180,000 worth of wastewater treatment systems to three slaughterhouses owned by Ralston Purina multinational corporation.

These initial contracts led to an exclusive agreement between Ennix and Ralston Purina’s hog,
dairy, and aquaculture markets in Brazil. According to Ralston Purina’s sales forecasts, the agreement will require $1.5 million of Ennix products annually.

Slaughterhouses of this type represent a $5 million annual market in Brazil.

Source: Latin America Fund for the Environment, Annual Update: FY 1999.

The Environmental Technology Fund (Tech Fund), created under the U.S.-AEP, provides matching grants of up to $20,000 to help small and medium-sized U.S. companies enter Asian environmental markets. Grants match from 20 to 50 percent of total project costs.

The Tech Fund focuses on pollution control, cleaner technologies, and energy efficiency. Preferred projects are those that aim to reduce or eliminate Asia’s greenhouse gas (GHG) emissions. Environmental activities that are eligible for a grant include engineering/technology workshops or seminars, business development missions, and technology/equipment demonstrations. Over the five years of the program’s operation, grant funding has been provided for more than 275 projects, facilitating over $350 million in export sales of U.S. environmental products and technologies.

NASDA has recently completed a similar Latin America Fund for the Environment program that has
awarded matching grants (of up to $15,000) to 51 projects in 17 countries throughout Latin America and the Caribbean, and generated over $21 million in revenues for participating U.S. firms.

Under a cooperative agreement with the EPA, NASDA is currently conducting a Program for
Environmental Technology Transfer (PETT) with China. The program enables small and medium-sized businesses to fund technology demonstrations, workshops, and development programs targeting pollution prevention, air pollution, wastewater treatment, and energy efficiency in China.

U.S. EPA Environmental Exports Promotion Programs

EPA’s Office of International Activities plays an important role in helping the U.S. environmental sector expand its export base. U.S. private sector groups have repeatedly underscored the importance of EPA’s international technology and technical assistance programs in creating markets for U.S. environmental goods and services.

By showcasing the effectiveness and capabilities of available and emerging U.S. environmental technologies, EPA technology demonstration programs in developing countries lead to follow-on commercial opportunities for U.S. firms. EPA’s training programs also prepare the way for exports of U.S. technologies. Training programs usually identify U.S. environmental technology manufacturers in the relevant sectors.

EPA’s Successful Technology Demonstrations

Demonstration of hazardous waste remediation technologies in Prague, Czech Republic resulted in $2.5 million in initial sales.

Demonstrations of small community drinking water systems in Mexico, Ecuador, and China helped
hospitals, schools, and local communities develop low-cost and easy-to-maintain sources of safe drinking water while opening up commercial opportunities for U.S. vendors.

Methane recovery projects resulted in U.S. oil and gas companies signing contracts for the development of methane fields in China and sales of landfill methane recovery technologies in Brazil and the Philippines.

Source: EPA, 1998

EPA is widely recognized as the world’s leading source of environmental information, which helps build capacity for the use of advanced technologies. In addition to providing thousands of pages of technical data via the Internet, EPA also makes information on U.S. environmental technology vendors available to potential buyers. For example, the Vendor Information System for Innovative Treatment Technologies (VISITT) provides vendor-supplied information on innovative technologies that can be used to treat contaminated groundwater, sludges, and sediments. EPA’s Clean Air Technology Center provides a similar resource for information on emerging and existing air pollution prevention and control technologies. Through its international visitors program, EPA staff help arrange tours of U.S. facilities that use innovative technologies and set up meetings with U.S. technology suppliers.

U.S. Technology for International Environmental Solutions (U.S. TIES), the only EPA program directly affecting environmental exports, was eliminated by Congress in fiscal year 1996, along with the Environmental Technology Initiative (ETI) that was designed to work directly with the U.S. private sector. Currently, EPA is integrating export promotion considerations into its other activities.

U.S. Department of Commerce Programs

Within the U.S. Department of Commerce, several offices and centers provide services that assist U.S. exporters in their business development efforts. Relevant contact information is provided in appendix A.

Environmental Technologies Industries (ETI) is the principal resource and key contact point within the DOC for American environmental technology companies including all business activities associated with environmental protection, assessment, compliance with environmental regulations, pollution control, waste management, remediation of contaminated property, design and operation of environmental infrastructure and the provision and delivery of environmental services. ETI’s goal is to enhance the international competitiveness and increase the exports of the U.S. environmental
industry by providing basic market and project-related research; supporting a variety of trade promotion activities, including leading trade missions; providing business counseling and representing the interests of U.S. environmental firms; and supporting the creation of public-private partnerships. ETI supports the Environmental Technologies Trade Advisory Committee (ETTAC) and the interagency Environmental Trade Working Group (ETWG), a subcommittee of the Trade
Promotion Coordinating Committee.

The U.S. and Foreign Commercial Service (the Commercial Service) has offices located in over 220 cities around the world to assist U.S. exporters. The organization offers U.S. businesses advocacy support and services such as export counseling, trade finance information, customized market research, and identification of trade leads. It also organizes trade missions and events, and offers a Gold Key Service to link U.S. firms with agents and distributors around the world by allowing visiting U.S. company representatives to get a first-hand understanding of the local market and make key contacts that are critical to successful exporting.

The Matchmaker Trade Delegations Program helps small and medium-sized U.S. companies establish business relationships in major markets abroad. Each Matchmaker Trade Delegation targets major markets in two or three countries with strong sales potential for U.S. goods and services. Commercial specialists at U.S. embassies and consulates in the targeted countries pre-screen contacts and arrange business appointments for participating U.S. firms. The Matchmaker Program also offers market research and evaluation of the market potential for a specific product or service; in-depth country market and trade finance briefings; interpreter services and logistical support; and export counseling before, during, and after the trip.

The Advocacy Center promotes U.S. firms through advocacy by high-level U.S. Government officials and tracks environmental projects worldwide. The Trade Information Center (TIC) is a comprehensive resource for information on all federal government export assistance programs. The TIC staff counsel small and medium-sized U.S. companies that are entering the export market. Multilateral Development Bank Operations provides the U.S. exporting community with comprehensive information on all multilateral development bank programs and opportunities.

Export Assistance Centers (EACs) are a joint effort of the Commercial Service, the Small Business
Administration (SBA), the Export-Import Bank of the United States, and USAID. The EACs personnel counsels small and medium-size export-ready businesses and helps them develop customized international business strategies. EACs are located throughout the United States and in nearly 70 countries abroad.

U.S. Trade and Development Agency Programs

The U.S. Trade and Development Agency (TDA) is an independent federal agency dedicated to assisting U.S. companies in pursuing business opportunities in developing countries and responding to foreign competition. It sponsors feasibility studies, definitional missions, and desk studies for major public and private sector projects in order to promote the use of U.S. goods and services in project implementation. By funding feasibility studies that evaluate the technical, legal, economic, and financial aspects of development projects, TDA provides U.S. companies with an opportunity to
get in on the ground floor of a project.

TDA focuses primarily on feasibility studies for infrastructure development projects. Funding from the
agency usually ranges from $150,000 to $750,000 for public sector projects. These feasibility studies also advise project sponsors about the availability of specific U.S. equipment and services. TDA publishes the TDA Pipeline, its biweekly newsletter, that highlights new definitional missions, feasibility study opportunities (also advertised in the Commerce Business Daily), and upcoming orientation visits and conferences. TDA business briefings and events often provide a good
introduction to current opportunities in a specific sector or region.

TDA hosts approximately 45 orientation visits each year. These week-long reverse trade missions bring foreign buyers to the United States to see equipment they may need for development projects. U.S. suppliers who participate in these visits are able to showcase their products and expertise, while making valuable international contacts. In conjunction with these visits, TDA often hosts a business briefing to allow U.S. companies to meet with the visiting delegation to hear more details about their needs.

Additionally, TDA hosts a number of events to assist in opening global markets to U.S. businesses. Each event offers
• Workshops that highlight the best project opportunities for U.S. businesses in the region
or sector;
• A complete briefing book profiling each project in detail;
• One-on-one meetings between U.S. companies and foreign project officials; and
• Strategy and insight into some of the worlds most challenging and rewarding emerging
markets.

Recommended Marketing Strategies

This section recommends strategies for U.S. companies to take advantage of U.S. bilateral environmental assistance programs as part of their marketing efforts in developing countries. The core components of marketing technologies remain the same as in any other market:
• Getting to know the market through country market intelligence;
• Finding a connections to the market through existing relationships and contacts;
• Establishing market entry by finding a sale or business opportunity; and
• Expanding market share through continued in-country marketing.

The resources and tools available to U.S. businesses through foreign aid can complement a company’s overall market entry strategy. However, these initiatives alone are not enough to launch a full-fledged export program. Instead, they provide a basis for building an understanding of the market, making initial contacts, finding the sale or deal, and expanding the market.

Understanding the Market

The first step toward developing a successful export market strategy is knowing where the markets are and how to gain access to them. Export markets can seem inaccessible to companies with limited overseas experience. To reduce these concerns, large and small companies should conduct preliminary market research. Knowing the stage and pace of market development, as well as the local business culture, is critical in prioritizing business development efforts.

Gathering information on the market can be done with limited travel and expense by using e-mail, the
Internet, a telephone, and a fax machine. The three types of information provided through U.S. foreign assistance that can be useful for U.S. companies seeking market intelligence are:
• Market reports,
• Intelligence from project managers in the U.S. Government and the private sector (contractors), and
• Information from in-country Technology Representatives.

Market reports are produced by several U.S. Government agencies: DOC, the Department of State,
and USAID. USAID has been publishing a Business Focus Series that reviews regional markets for energy and environmental technologies. These reports provide insight in market forces and trends, as well as specific market entry strategies and contacts. The subjects covered by the Business Focus Series include power generation, environment, energy efficiency, and water and wastewater markets. Contact the USAID Office of Energy and Infrastructure for more information.

The Departments of State and Commerce publish annual Country Commercial Guides for many countries. These guides give useful insights to the current political, economic, and social environment of the country, as well as important information on key market trends. DOC provides a wide variety of export and market information. By simply visiting the Commercial Service website (www.ita.doc.gov) it is possible to obtain information for the National Trade Data Bank (NTDB), Economic Bulletin Board, Industry Sector Analysis, International Market Insights, and Country Commercial Guide Summaries.

Project managers of USAID initiatives are another useful source for learning about the market in a particular country. USAID officers in Washington and the overseas Missions work with private sector consultants to design projects that address a specific issue or medium. In the development and implementation of these projects, USAID managers gather information on the trends and needs of particular industries or regions that can provide useful insights when evaluating a market for potential
exports. The projects and programs listed in chapters 2 and 3 of this report serve as a starting point to identify which programs address the sectors and regions of interest to suppliers of environmental technologies. Contacts for some of the organizations involved in these programs are provided in appendix A. A useful guide to USAID programs providing contact information for both USAID and its private sector consultants is the Guide to the Global Environmental Center: People, Programs, Projects, and Partners. USAID Missions can provide additional information on specific country programs. Useful websites to identify markets that are most affected by U.S. foreign assistance are:
• The USAID website (www.info.usaid.gov), which contains the agency’s congressional presentations for each fiscal year. These presentations characterize its global, regional, and country-specific programs.
• EPA’s Office of International Activities website (www.epa.gov/oia/crp.htm), which describes
EPA’s international initiatives.

The third resource available for understanding the market is the in-country Technology Representatives, supported under the US-AEP and EcoLinks initiatives. These representatives are good sources of on-the-ground information as they interact with local government and business officials on a daily basis to evaluate needs and market opportunities.

A company can utilize each of these resources to begin identifying and prioritizing country markets for
particular products or services. At the same time, firms can learn which U.S. and foreign companies are active in the country and evaluate their competitiveness.

Making Initial Contacts

One of the more difficult tasks to achieve market entry and penetration is making the initial contacts with prospective clients and partners. This is perhaps the greatest barrier to exporting technologies, particularly in cultures where business deals are not concluded without first developing a strong professional relationship. A company looking to export its products should expect to travel to the country of interest to develop relationships. A company can leverage environmentally focused U.S. foreign assistance to make the initial contacts by taking advantage of the following U.S. Government-sponsored resources:
• U.S. Foreign and Commercial Service Representatives and US-AEP and EcoLinks Technology
Representatives;
• Grants, trade missions, and exchanges; and
• Government-supported partnerships between nongovernmental organizations (NGOs).

A good place to start is with the on-the-ground services provided by U.S. Commercial Service
Representatives or Technology Representatives. As mentioned in the previous section, these representatives work with local governments and businesses to facilitate the introduction of U.S. companies and their products to foreign markets, some of these services are fee-based, for example DOC’s Gold Key Service which links U.S. companies to potential clients and distributors overseas.

Traveling for the first time to a new country on business can be a daunting and overwhelming
experience, both financially and professionally. To ease some of the stress involved in taking a product to a new market, the U.S. Government has developed specific programs and resources to engage the private sector in their environmental initiatives. Some examples of the resources and tools available through foreign aid include:
• Grants to share in the expense of demonstrating technologies, translating brochures, and traveling to meet prospective clients;
• Trade missions, providing U.S. companies with an opportunity to visit and meet with potential
clients; and
• International exchange programs, assisting with travel arrangements and the organization of
meeting agendas.

For more detail on the specific initiatives providing these resources refer to chapter 3, and appendix A for contact information.

The partnerships between U.S. NGOs and their international counterparts can also serve as a starting
point to finding and making the right contacts overseas. The NGOs and membership associations provide a key link between the U.S. Government agencies and U.S. firms interested in doing business in overseas energy and environmental markets. Whether direct recipients of foreign aid for project management and implementation, or advisors on program strategies and design, these groups often have at their disposal firsthand knowledge of industry needs, lists of international contacts, and a wide variety of information resources.

For example, U.S. companies participating in the Energy Efficiency Industry Partnership Initiative run by the Alliance to Save Energy benefit from the opportunity to develop new project leads and establish relationships with potential distributors and representatives for their products (see chapter 2). As of January 1999, participating companies have reported that, as a result of contacts made at seminars of the Alliance to Save Energy, projects worth $5.9 million have been completed, with another $9.6 million being considered or in the pipeline 5 . The Business Council for Sustainable Energy (BSCE) has developed a network of U.S. companies and business trade groups representing the renewable energy, energy efficiency, electric utility, transportation, engineering, and natural gas industries, among others (see chapter 2 for more detail). Participating companies benefit by
• Gaining access to new investment opportunities;
• Receiving invitations to investment conferences and meetings with government representatives
and potential business partners; and
• Obtaining information on market expansion and regulatory and policy changes.

The National Pollution Prevention Roundtable, the Air and Waste Management Association and the Water Environment Federation are examples of other organizations that are involved in one or more of the U.S. Government’s environmental assistance initiatives. These and other NGOs are developing overseas memberships and regularly sponsor events with high networking potential. Appendix A provides contact information for each of these organizations.

Finding the Sale

The ultimate objective of efforts to understand the market and make contact with potential buyers of
equipment is the actual deal or sale of equipment. U.S. environmental foreign assistance provides several tools for U.S. Companies to help identify sale opportunities, including:
• Procurement,
• Trade leads, and
• Direct contact with buyers.

Procurement under USAID contracts is one way of entering or expanding into a new market. Although procurement opportunities are publicly announced in the Commerce Business Daily or the Procurement Information Bulletin, getting to know the project and its managers can increase opportunities to be awarded the contract. It is critical to provide after-sales service and parts supply under each procurement in order to ensure technological sustainability and create a long-term relationship with the buyer. With USAID-sponsored training and technical support to end-users, the demand for a technology that has demonstrated its benefits under local conditions is likely to grow, offering
more opportunities for the original U.S. supplier.

Trade leads such as those provided by the Global Technology Network provide a direct line to prospective buyers. Although the majority of trade leads do not end in sales (less than 5 percent according to sources at GTN), they do provide insight into the market demands as well as company contacts. A trade lead presents a real opportunity; however, the burden of developing the relationships necessary to close the deal falls on the U.S. firms that respond to the lead. Counseling services of GTN and its affiliated networks (ETNA EcoLinks) provide additional support to firms
interested in pursuing a lead.

The most effective and perhaps most difficult way to close the deal is to independently cultivate
relationships with potential buyers of technology. This requires a commitment of time and direct interaction with the client. U.S. companies should take advantage of the resources available through USAID grants and program initiatives to demonstrate technologies and provide supporting materials.

Expanding Market Share

Once a company has concluded a transaction and has effectively entered the market the objective is to expand market share. Each of the tools described earlier in this section can also be used for business expansion. Some additional resources provided through U.S. foreign assistance that can contribute to a market growth strategy are as follows:
• Conferences and workshops,
• Direct marketing, and
• New partnerships and joint ventures.

The conferences and workshops sponsored by USAID or other U.S. Government agencies often target industry representatives and provide opportunities for marketing and increased name recognition. Taking advantage of these opportunities will inform both local businesses and the USAID Mission about the environmental products available, relevant in-country experience, and past performance of technology. Letting the mission know about a company’s presence in the country is also useful in terms of procurement prospects as well as involvement in USAID-sponsored training, outreach,
promotional, and educational events. To find out about conferences and workshops hosted by the U.S. Government contact the USAID project managers, implementing organizations and consultants, NGOs, and Technology Representatives.

Direct marketing efforts should include communication (presentations, distribution of technical materials, etc.) with end-users that have benefitted from U.S.-funded technical assistance activities, participants of U.S. Government-sponsored workshops, training courses, and conferences, as well as private sector companies that are likely to be affected by USAID- or EPA-supported policy programs (e.g., new environmental regulations).

It is important that U.S. companies establish local partnerships and representation to have the advantage of learning about business opportunities before their competitors. Establishing a local office also helps companies respond faster to sales leads and provide comprehensive service from customized design and installation of a technology to technical support and after-sale maintenance. While the U.S. Government does not provide partners and joint ventures for U.S. companies, the resources under its environmental programs can be used to identify likely candidates. Again, it is advisable to make use of the networks provided by foreign assistance to develop a list of potential partners.

While U.S. foreign assistance does not guarantee the export of environmental technologies, there is a wide variety of resources available to U.S. businesses provided both directly and indirectly through U.S. foreign assistance. Using these tools and resources as part of a larger overall market entry strategy can benefit U.S. suppliers of technologies looking to expand their business overseas.

Table 4
Summary of U.S. Government Market Information by Agency

Business Development Steps	USAID	EPA	DOE	TDA	DOC
Market research in the United States	X				X
Preliminary project intelligence in the field	X	X	X
Trade missions and exchanges	X			X	X
U.S. Government procurement	X
Trade leads	X				X
Direct marketing	X	X	X