The environmental services market has grown at higher rates than the overall environmental sector in Mexico. Companies that specialize in developing feasibility, risk, and tariff impact studies, as well as other environmental consulting firms, will find important business opportunities, not only at the federal level, but also increasingly at the municipal level, where many decisions will be made regarding local environmental projects.
The volume of environmental impact studies, environmental audits, and other consulting services for implementing environmental management programs within large and medium-sized corporations has grown tremendously; in the case of risk studies, from 73 in 1992 to 449 in 1999. Stronger enforcement programs that will be enacted by federal and, especially, local authorities are expected to rapidly increase the demand for those services.
By the end of 2000, new administrations were in office not only at the federal level but also at the state level and in Mexico City. The Fox administration is now producing the National Development Plan 2001–2006, which will define the administration’s actions and activities to be carried out during its six-year term. Although many specific actions have yet to be announced, Fox’s commitment to the environment is clear.
Environmental Studies
The Fox administration will strongly promote private participation in the development and operation of environmental infrastructure, which will result in a much greater demand for environmental studies necessary to evaluate the feasibility of environmental projects. At the municipal level, there will also be an increase in the demand for such studies and services, which in many cases will be paid for with monies from FORTEM.
SEMARNAT recently announced the National Crusade for Forests and Water. The National Crusade for Forests and Water will become a driver for environmental studies to identify and assess opportunities to protect and restore forests, aquifers, and superficial waters. Monitoring services and water-quality analysis technologies, such as inspection equipment, are expected to face increased demand.
The Mexico City government is also redefining its environmental policies and priorities. Several opportunities are expected to derive from the new PROAIRE being developed by Dr. Mario Molina.
Like SEMARNAT, Mexico City’s Secretariat for Environment was restructured, and a new Directorate for Water, Soil, and Municipal Waste Projects was established. This new office will require numerous environmental studies, which will be contracted mainly to private companies. The directorate has the following functions:
To provide technical guidelines for the development or modification of regulations
To coordinate and review the progress of environmental projects and programs
To evaluate the technical feasibility of projects and programs
To design strategies and action plans
To follow up with existing projects and programs
To perform or contract-out integral studies
To promote technological exchange between national and international institutions
To promote and evaluate new technologies
To operate the pilot station for real time sewage water monitoring
The directorate has the following short-term plans, which will require assistance from private consultants and research centers:
To implement the Program for Integrated Hazardous Waste Management 2001–2010
To develop regulations for soil and municipal waste pollution control
To install and operate the first sewage water monitoring station
To develop and install a laboratory for certification
Environmental Audits
The Fox administration will modify the voluntary environmental audit program described in Chapter 4 to strengthen the program and increase its efficiency. Plans include creating consumer awareness about which companies have received certification for being environmentally friendly. These changes will increase the number of business opportunities for consultants in the short term and could open opportunities for U.S. auditors in the mid term.
The new deputy attorney general responsible for the environmental audit program has identified some deficiencies in the existing program that need to be corrected:
The environmental audit process lacks an established methodology or procedural guidelines. Critics of the program argue that the audits could result in a subjective evaluation and contribute to confusion in developing an environmental management plan. Such criticism has made companies afraid of such audits because they do not know the precise parameters of the audit and the implications for developing an investment plan.
Participation in the program has necessarily been limited because only 130 certified auditors are available to examine the 28,000 companies in sectors under federal enforcement responsibility. Certain regions do not have enough auditors; most auditors are located in central and northern Mexico. PROFEPA is working to increase the number of auditors, but it will promote the use of qualified companies instead of individual auditors, who are difficult to monitor on a regular basis. PROFEPA will recommend using consulting companies with vast experience in industrial processes and environmental technologies.
PROFEPA considers that certified companies have not seen any benefits from participating in the voluntary audit programs. To create an added incentive for certification, PROFEPA is considering developing a campaign recommending to consumers hat they purchase products from certified companies. PROFEPA will also develop a clean industry logo to be placed on the products of certified companies that have shown excellence in using environmentally friendly processes. PROFEPA expects that an added benefit of this campaign will be an increased social awareness of the importance of sustainable development.
Besides correcting the deficiencies of the auditing process, PROFEPA will take additional steps to improve the program and further industry compliance with environmental regulations. Specific actions being contemplated include developing closer working ties with municipal and local governments to promote clean industries in their regions and developing certifications for clean municipalities. Also, audit programs covering complete industrial parks will be promoted. Under that concept, once all companies in a given industrial park have demonstrated compliance with the regulations, the park will be certified as a clean industrial park and all companies in the park will be allowed to use the clean industry logo. PROFEPA is interested in expanding the program to cover other economic activities besides industry. For example, it is considering offering certification to hotels and other tourist developments.
Because developing an adequate pool of auditors is critical to the success of the program, PROFEPA plans to create a specific entity, comprising representatives of government, industry, and research centers, and which will be responsible for certifying auditors. PROFEPA also plans to limit the role of auditors to performing the audits and require that a different consulting company be responsible for developing the environmental management and investment plans. That measure seeks to ensure the independence of the audit process.
PROFEPA is willing to open the audit market to U.S. firms—both auditors and other consultants—but before doing so will require reciprocity from the United States to open its doors to Mexican auditors and consultants. That process will take time because the certification standards will need to become similar. While this topic is debated within PROFEPA, U.S. companies can participate in the market by establishing a Mexican subsidiary and obtaining local certification.
Best Prospects
Six principal sources for environmental consulting service projects are as follows:
Developing federal environmental programs. Priority areas in the short term will include studies to assist in the National Crusade for Forests and Water and in reviewing regulations for hazardous waste.
Developing state and municipal environmental projects. A priority area is the strengthening of municipal fee collection systems to allow for increased environmental investments, especially on water and waste projects. Assisting the development of PROAIRE in cities with more than 500,000 inhabitants is also a priority.
Developing programs and projects in Mexico City. Such projects include specific projects for improving air quality, studies for recharging the aquifers, evaluations of contaminated sites, and site selection of a new solid waste landfill.
Developing environmental investment programs for private- and public-sector companies. Opportunities include environmental consulting to PEMEX, consulting to reduce air emissions at CFE’s facilities, and consulting to define necessary investment programs to abate pollution in specific industrial facilities.
Performing consulting assignments financed by multilateral institutions. Programs financed by such institutions include IDB and BANOBRAS’s FORTEM and IDB’s Aquifer Recharge Program in Mexico City.
Performing consulting and feasibility studies financed by U.S. government agencies. Such agencies include U.S. TDA and U.S. AID.
