Environmental Technologies Industries
||Environmental Technologies Industries
|Philippines Export Market Plan|
|I. Environmental Market Overview|
This chapter presents estimates of the total environmental market size in the Philippines, as well as the best prospects for each market sector. More detailed sectoral profiles, including current business opportunities, are presented in subsequent chapters.
The Philippines' national environmental protection system is struggling to catch up with the booming economic growth of the last few years. While the regulatory framework for environmental protection is fairly comprehensive, the enforcement of national programs requires significant strengthening before visible improvements in environmental quality will be seen. A general lack of awareness of the risks associated with air, water, and soil pollution, combined with the limited resources of the agencies tasked with implementation, are the primary barriers to effective enforcement.
Although the country's market for environmental technologies and services is in an early stage of growth, good opportunities do exist for U.S. companies. Table 1 shows two sets of estimates of the size of the environmental market. The California-based Environ-mental Business International (EBI) estimated the Philippine environmental market at $346 million in 1995 (excluding the revenues of water and wastewater utilities). The U.S. Department of Commerce (USDOC) has generally produced higher estimates in its series of Industry Sector Analyses over the last four years. In table 1, the USDOC estimates have been recalculated for illustrative purposes for 1997.
Table 1: Comparative Estimates of the Philippine Environmental Market
Source: Hagler Bailly Services, 1997. Based on estimates generated by Environmental Business International and the U.S. Department of Commerce.
|Market Segment |
|Water Supply and Distribution|
|Air Pollution Control|
|Hazardous Waste Management|
|Solid Waste Management|
|Medical Waste Management|
Water Supply and Pollution Control
The market for water supply and pollution control, which includes municipal and private clients, is currently the largest of the Philippine environmental market segments. For U.S. companies, significant opportunities exist for minority equity holdings (i.e., up to 40 percent) in the privatization of Philippine water and wastewater utilities. Several U.S. firms are already aggressively pursuing these opportunities, and competition is stiff from European firms. Large World Bank and Asian Development Bank (ADB) water infrastructure development loan projects have earmarked millions of dollars for imported equipment. U.S. companies are eligible to participate in the bank-sponsored international competitive bidding for these. In the industrial water and wastewater treatment market, good sales prospects exist for filtering and purifying, water recycling, materials recovery, and sludge dewatering systems for a range of industry categories.
Solid waste management has received greater attention from both the national and local governments in recent years. The Presidential Task Force on Solid Waste Management has produced guidelines for the evaluation of build-operate-transfer (BOT) projects in the waste treatment sector, as well as guidance to help local government units (LGUs) develop municipal ordinances on solid waste management, among other things. Good opportunities exist for U.S. waste management companies and equipment vendors to participate in LGU waste collection and disposal infrastructure development projects, such as the $53.8 million solid waste management program of the National Capital Region (NCR). A number of U.S. companies are already participating in these projects.
Opportunities in the hazardous waste treatment, storage, and disposal market are more limited, however. Growth in this market segment awaits enforcement of the newly drafted toxic substances and hazardous waste management regulations. Prospects are a little better in the medical waste treatment market, as the Department of Health recently passed a regulation requiring all hospitals and medical facilities to install incinerators as a condition for the renewal of their annual operating licenses.
Air Pollution Control
Business opportunities in the Philippine air pollution control equipment market are currently limited due to the uneven enforcement of point and mobile source emissions control regulations. To date, air pollution control has not received as much attention as the water and wastewater sector, although enforcement actions have been taken recently against sugar mills, cement plants, and woodworking shops for violations of source standards. The best current prospects for U.S. companies lie with donor-funded initiatives for Metro Manila, including a potential World Bank credit facility for industrial-source emissions control and a loan from the Asian Development Bank to the Department of Environment and Natural Resources for mobile source emissions control in Metro Manila. The market may pick up after the passage of the new Environment Code, which envisions a gradual tightening in emissions standards, where technically and economically feasible.
Monitoring and Analytical Equipment
Almost 100 percent of the monitoring and analytical equipment used for ambient and source air and water quality monitoring in the Philippines is imported. U.S. firms are in an excellent position to take advantage of opportunities in this sector because Filipinos generally believe U.S. equipment is of high quality and reliability. Opportunities for sales of organic vapor meters and other soil contamination measuring equipment will have to await the passage of stricter regulations concerning liability for site contamination and remediation.
The environmental consulting services market is not entirely open to U.S. companies according to the Foreign Investments Act, which restricts engineering, chemistry, geological, and other professional services to 100 percent Filipino-owned companies. Nonetheless, several U.S. companies have penetrated the market by establishing local subsidiaries. These firms have taken a leading role in conducting environmental impact assessments (EIAs) and baseline studies for both public sector and private clients. Another option for U.S. firms is to provide services to multinational corporations operating in the Philippines. These firms often hire consultants from their home office in the United States to do design work for pollution control systems, as well as environmental management consulting.
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