Environmental Technologies Industries

Environmental Technologies Industries

Market Plans

Central and Eastern Europe Export Market Plan

III. Hungary

Summary of Findings

Annual environmental expenditures in Hungary amounted to 258 mln USD in 1994 (0.76% of GNP), and 385 mln USD in 1995 (1.1% of GNP). Expenditure on water protection account for 55% of the total, while spending on air protection accounts for 15-16%, and waste management for 12%. During the next six years, the share of air protection expenditures is expected to double, and the share of waste management is expected to rise to 19%.

A major change is expected in the financing of environmental protection. Currently, some three quarters of environmental expenditures come from the state budget (including Central Environmental Protection Fund), while businesses contribute only 9%. It is expected that in the forthcoming six years the share of state budget will decrease to 55%, while the share of the business sector will grow to 40%.

The energy sector is the main source of

air pollution

(SO2, NOx, solid particles, and CO), although emissions from transportation and vehicles have also become a growing source in Budapest and other cities.

Municipal waste

generation doubled over the last fifteen years. About 85% of municipal waste is landfilled. There are 602 official landfills operated in Hungary, with an estimated 2000 more operating illegally. It is expected that most landfills will reach their capacity limit in the near future. Many landfills do not meet required standards. The disposal of

hazardous waste

is one of the most pressing problems. A significant proportion of hazardous waste is stored on-site at the source in so-called temporary storage facilities. Currently, 96 per cent of the Hungarian population has access to the water supply system, but only 53 per cent are connected to sewage systems. Poor

water quality

is a frequent problem. 54% of

wastewater

is discharged untreated, while only 36% is treated mechanically and biologically. The government plans that, by the year 2010, 90% of all wastewater will be treated.

The Hungarian market for environmental technologies was estimated to be worth between 164 and 192 million USD in 1994, and between 127 and 289 million USD in 1995. Significant project opportunities are expected in wastewater treatment, in the energy sector, and in air quality protection and waste management. Project opportunities will result from the major environmental problems such as catalogued and uncatalogued hazardous waste disposal sites; municipal and industrial wastewater pollution of surface and groundwater reserves; and emissions and noise from transportation. Demand for environmental technologies is also driven by national environmental priorities, environmental regulation, and available state funding and subsidies.

Based on the above, environmental technologies in the following areas are expected to be in growing demand in the near future: monitoring systems for water, air and noise; remediation work on hazardous waste dumps; treatment of municipal solid waste and wastewater; treatment of industrial solid waste and wastewater; improving energy efficiency; reducing emissions to air and noise from transportation. Currently, end-of-pipe technologies are mostly used to solve the above problems, but the significance of preventive solutions is expected to increase.

There is no institution or clearinghouse in Hungary collecting information about environmental business opportunities. Personal and professional contacts are the main source of information. Business and environment-related publications, as well as participation in environmental trade fairs and conferences are other important sources. The public procurement procedure currently in force is a potentially important way to identify business opportunities.

Purchasing environmental technologies does not pose any significant problem in Hungary because of the wide range of products available on the market. Major ways of gathering information when buying environmental technologies include: personal and professional relations; industry associations; fairs and exhibitions; journals and catalogues; the foreign owner or parent company; and references.

In most categories, demand for environmental technologies in Hungary was estimated to be between moderate and high. Significant demand was identified for energy-related technologies, and for technologies related to industrial wastewater treatment and the treatment and disposal of hazardous and radioactive waste.

High demand in the

air sector

was identified for instrumentation and process control/software, while growing demand was expected for technologies for air sampling/laboratory analysis for gaseous emissions, and for air pollution control/flue gas purification equipment.

Demand for environmental technologies related to

water and wastewater

was moderate. The most needed technologies in this category were those for industrial wastewater treatment. High demand was identified for sludge treatment and disposal technologies for industrial and municipal wastewater. Specific technologies where demand is expected to rise included those for the construction of collection networks for municipal and industrial wastewater; water recycling and reuse for potable water and industrial wastewater; spill control and containment/cleanup for surface and groundwater; instrumentation, process control, and software for industrial wastewater; standard and advanced treatment technologies for industrial wastewater; and inspection and reconditioning of existing wastewater collection networks.

Waste management

appears to be one of the most promising environmental market sectors in Hungary. Significant opportunities are expected in hazardous waste disposal, followed by radioactive and industrial waste management. High demand was identified for technologies for site remediation/cleanup of contaminated land for hazardous waste; and, for radioactive waste, equipment for sample analysis/waste characterization; site monitoring; and waste collection, transportation and storage. Demand was expected to rise for pollution prevention/waste minimization equipment for industrial and hazardous waste; technologies for recycling/resource recovery for industrial waste; technologies and equipment for waste collection, transportation and storage of hazardous waste and hazardous waste site monitoring; and technologies for spillage control/decontamination for hazardous waste.

Demand for

energy-related technologies

was generally high, especially in comparison with other environmental sectors. Technologies where high demand was identified included: instrumentation; and equipment for retrofitting/ rehabilitation of existing systems. Demand was increasing for equipment related to process management and control; new and efficient energy and heat generation systems; and technologies related to heat recovery and energy savings. Many experts noted that there were significant market opportunities in decreasing energy losses in production process, transmission, and consumption.

In the

noise, vibration and occupational health and safety

sector, high demand was identified for abatement technologies (e.g., insulation, absorbtion), and for protection equipment in the occupational health and safety sector. Increasing demand was also identified for noise and vibration abatement technologies in the construction industry.

The energy and power generation sector and municipalities are the main end-users of environmental technologies in all categories. The chemical industry, and other raw material extraction and processing industries are also significant end-user groups. Additionally, the transport sector was identified as a significant user of technologies for air pollution control, and noise and vibration abatement. Water and wastewater, and waste management technologies were widely used in the mining sector, agriculture and food processing, and textile industry.

Five out of six respondents considered product quality and references as major factors when making purchasing decisions. One interviewee in six preferred domestic technology whenever possible. Among respondents buying foreign environmental technologies, about a half buy directly from a foreign supplier, and the other half buy from local representatives. With the growing number of local representatives, local buying is on the rise.

About 50% of respondents specified high quality, and reliability and durability of products as advantages of foreign environmental technologies. A third of respondents thought that foreign environmental technology products offer good value for money, and are user-friendly and easy to operate. Also, a third of respondents regarded available credit or other forms of funding from a foreign supplier as a major advantage. Opinions were divided about the quality of after-sales service.

The major barrier to buying foreign environmental technologies in Hungary is the price. 80% of respondents mentioned high prices as a major disadvantage of foreign products; about a quarter regarded foreign technologies as unsuitable for local conditions and technical culture. Other barriers cited (about 15 per cent of respondents) included high customs duties, changing environmental regulations, difficulties to ensure local technical service, communication problems with foreign suppliers (mainly language), and the lack of information available about suppliers.

Domestic environmental products and services are only available on a limited scale, and foreign environmental technologies are frequently used. Austrian and German environmental technologies enjoyed good to excellent reputation in air, water and wastewater, waste management, and energy sectors. Perception of American technologies was good in water and wastewater, waste management, energy, and noise, vibration, and OHS sectors. Dutch technologies were rated highly the water and wastewater and energy sectors. French products were evaluated highly in water and wastewater, and waste management sectors.

Austria and Germany are the major players on the environmental technology market in Hungary, followed by Holland, France, USA, Japan and Scandinavian countries. Foreign companies are most active in the energy, water and wastewater, and waste management sectors, followed by air protection. In

air

, and the related

energy

sector, German, Austrian, and American companies are most active. German firms dominate the

water and wastewater

sector, followed by Austrian, French and American suppliers. In the

waste management

sector, German, Austrian, French, and American companies seem to be represented quite evenly.

About a third of respondents were familiar with American environmental technologies. Overall, the availability of American environmental technologies on the Hungarian market is limited, and so is the level of familiarity of Hungarian experts with US products. Opinions on the quality and competitiveness of American environmental technologies were divided.

Table 3.1: Basic Country Information

Indicator	Czech Republic	Hungary	Poland	Slovakia
Population (Millions)	10.3	10.3	38.5	5.3
Area (Sq. Km)	78,900	93,000	312,700	49,000
GDP ($Billions US)	44.7	43.8	115.7	16.0
GDP Growth (%)	4.4	0.5	5.4	6.9
Foreign Direct Inv. ($Billions US)	7.2	15.0	12.0	0.9
Unemployment (%)	4.1	10.6	13.5	13.6
Average Monthly Wages ($ US)	360	382	350	315
Real Wage Growth (%)	11.8	-6.4	5.1	2.4
Inflation (%)	7.3	18.9	17.3	6.0
Exchange rate to the $US	29.3	176.2	3.1	33.1

Methodology

Sources of Information Used in the Survey

The main source of information for this report were forty nine formal interviews with senior-level representatives of environmental business, and a smaller number from authorities and R&D institutions. Interviews were based on the standard questionnaire. Additional information sources included informal conversations, a desk study of available literature and publications on the environmental market in Hungary, and a review of environmental technology-related governmental programs. The list of formal interviews, informal personal discussions, and literature is included in Appendix B and Appendix C.

Profile of Respondents

Senior representatives of 49 organizations were interviewed for the survey. The following criteria were used in selecting parties for interviews:

coverage of all environmental sectors, and energy, noise, occupational health and safety;
significant position on the market;
representative sample of different types of organizations (ownership, size, structure, expertise);
location in different regions of the country;
interviews with the most significant environmental technology R&D centers.

Distribution of the respondents by sector was as follows:

business sector 64 %
government sector 18 %
R&D sector 18 %

Eighty per cent of interviewed organizations were active in one, two, or three out of the five target sectors. Half of interviewed environmental businesses were active only in one field, usually waste management or water treatment. Covering all five target sectors equally was hard to implement in practice, because in Hungary, there are many companies with business activities related to water, wastewater and sludge. In contrast, only a handful of businesses deal with air, noise and vibration, or operational health and safety.

The nature of business sector activity is as follows:

services 58 %
consulting 22 %
trade 15 %
manufacturing 5 %

Those companies with the highest turnover were generally dealing with trade, or were service providers (e.g., municipal service providers). Among smaller companies, a high proportion were consultancy firms. 53 per cent of the interviewed companies were established before 1990 (or had a legal predecessor established prior to 1990). New ventures usually included small and medium-sized enterprises (Hungarian-owned or joint ventures) while older parties tended to be larger companies. Overall, the market is dominated by small and medium-sized enterprises. The distribution of business sector respondents by size (measured by number of employees) was as follows:

Less than 10	53 percent
Between 10 and 100	37 percent
Over 100	10 percent

More than a half of the companies surveyed had fewer than 10 employees. Only one in ten employed more than 100 environment-related staff. Regarding turnover figures, 55% of the respondents classified their organization as medium-sized; the remaining 45% considered their companies small. Not a single respondent indicated their organization as large. Notably, only two thirds of responding companies revealed annual turnover figures.

The summary breakdown of turnover is as follows:

below HUF 10 million (approx. USD 60 thousand) 23 per cent
between HUF 10 and 100 million (USD 60-600 thousand) 41 per cent
over HUF 100 million (over USD 600 thousand) 36 per cent

Approximately two thirds of interviewed businesses had a representative office, or were headquartered in Budapest, while a third operated in other locations.

As for geographic scope of activities, respondents indicated the following scope of operations:

Local 25 per cent
National 42 per cent
International 33 per cent

Joint ventures generally operated internationally.

Problems Encountered

The main problem encountered was the strict time schedule of the research project. Some important institutions could not be interviewed because appropriate persons were abroad or too busy to fix an appointment. In other cases, no competent and available contact persons could be identified. Several of the contacted parties considered the research industrial spying, detrimental to the Hungarian environmental industry.

Another problem was the usefulness of existing databases to identify major players in the business sector. As a consequence of the rapidly changing organizational activities or unreliable data, the researcher had to select many new target organizations for interviews.

Confidentiality was a sensitive issue for some respondents, in particular the questions relating to turnover, major environmental problems, or current projects being undertaken. Many of the questionnaire respondents declined an interview, or lacked authority to give out certain information, resulting in delays in collecting all the necessary information while permission procedures, official letters, etc. were sought after.

The last major problem was the length of the interview, resulting from the detailed questionnaire. Many interviewees did not have time to address all the issues raised.

Overview of the Market

With a population of 10.3 million, and an area of 93 thousand sq.km. (36 thousand sq.mi., slightly smaller than Indiana) Hungary is a medium-sized country by East European standards. The environment does not receive the same attention now as it did in the early nineties. However, the country does have one of the most advanced systems of environmental management in Eastern Europe, and its environmental problems, while difficult, are not on the same scale as those of some other countries in the region.

Hungary suffers from general environmental degradation (e.g., poor water quality throughout the country) rather than from particular and local environmental problems. The exception might be the Budapest area (with a fifth of the country’s population), where specific environmental problems tend to be encountered, e.g., air pollution. The rapid growth of small and medium-sized enterprises is considered to be a contributing factor to the ongoing degradation of the environment since enforcement of environmental regulations is poor.

The most critical environmental problems are related to water quality. Uncontrolled runoff has led to contamination of water resources, further exacerbated by discharge of untreated sewage. Half of the country’s sewage is discharged untreated. There are also increasing problems with air pollution from high-sulfur power production, industry, households and transport, and with the management of municipal and hazardous waste (Hungary has some 2000 illegal dump sites).

The consolidation and refinement of the national environmental strategy is needed in the coming years, as well as the integration of environmental concerns with other areas of government. Major upcoming initiatives are likely to involve capital investments, awareness raising, institutional improvements, and environmental management.

Total Country Spending on Environmental Technology

Total spending on environmental protection in Hungary was 0.76 per cent of the Gross National Product in 1994, 1.1 per cent in 1995, and 1.1 per cent in 1996 (estimated). As shown in Table 3.2, annual environmental expenditures amounted to 258 mln USD in 1994, and 385 mln USD in 1995.

Table 3.2: Environmental Expenditures 1994 - 1996

Year Environmental Expenditures (USD mln) Share in GNP (%)

1994 258.4 0.76

1995 385.0 1.1

1996 (estimated) n.a. 1.1

Source

: Ministry of Environment, National Environmental Program (NKP) - Draft, Budapest, 1996

The government has adopted a National Environmental Plan (hereafter NKP), which determines the main environmental priorities over the coming six years. According to the NKP, environmental expenditures will reach 1.7-1.9 per cent of the Hungarian GDP.

The National Environmental Plan estimates the share of individual sectors in terms of the total environmental expenditures. According to the NKP, expenditures on water protection account for 55% of the total, while spending on air protection accounts for 15-16%, and waste management for 12%. The share of air protection expenditures is expected to double within the next six years, as Hungary is to introduce a new law on air protection in 1997. During the same six-year period, the share of waste management is expected to rise to 19 per cent from the current 12 per cent.

The next question relevant to this survey is the annual expenditures on environmental technologies. Detailed statistical information on the subject is not available, as it is not tracked by the National Statistical Office. Therefore, figures provided below are estimates, as explained in the text.

In 1995, the Regional Environmental Center (REC) conducted a survey of environmental businesses in the Czech Republic, Hungary, Poland, and Slovakia. Table 3.3 shows the distribution of income among Hungarian environmental businesses by business activity.

Table 3.3: Source of Revenues by Business Activity in the Environmental Sector in Hungary

Source of Revenue Share in Total Revenue

Technical Services 50%

Environmental Products 22%

Testing and Monitoring 15%

Source

: REC; The Emerging Environmental Market, 1995

Assuming that environmental technology expenditures account for 80 per cent of technical services, for 100 per cent of environmental products, and for 50 per cent of the remaining two categories (the balance is spent on services), one can estimate that roughly 75 per cent of total environmental expenditures is spent on environmental technologies.

For comparison, a 1995 OECD survey gives similar results (Table 3.4). The survey analyzed sector trends in the global environmental market. The methodology used in the survey assumed that expenditures on water and wastewater treatment, waste disposal, and air quality related-activities were mainly related to investment goods (environmental technologies).

Table 3.4: Sectors of the Environmental Market in OECD Countries

Sector Share in Expenditures

Water and wastewater 30%

Waste management 20%

Air pollution control 15%

Other investment goods 11%

Services 24%

Source

: OECD: The Environment Industry and Markets in Selected CEE Countries, Paris 1995

As presented in Table 3.4, technology expenditures account for about 75 per cent of all environmental spending, with services representing the remaining quarter.

According to Hungarian statistics on annual environmental expenditures, and based on the assumption discussed above that spending on environmental technologies accounts for three quarters of total expenditures, total environmental technology spending in Hungary is estimated at HUF 31 billion (192 mln USD) in 1994, and HUF 45 billion (289 mln USD) in 1995.

Statistical Yearbooks for 1992, 1993, 1994 and 1995 provide the following data on spending by sector:

Table 3.5: Environmental Technology Expenditures in Hungary by Sector in Mln HUF ($Million US)

Category 1992 1993 1994 1995

Protection of soil 733 (9.3) 466 (5.1) 1044 (9.9) 235 (1.9)

Water protection 7414 (93.9) 7929 (86.1) 13063 (124.3) 10164 (80.9)

Protection of air quality 5379 (69.4) 1356 (14.7) 1376 (13.1) 1184 (9.4)

Protection of biodiversity 201 (2.5) 205 (2.2) 57 (0.5) 2230 (17.7)

Nature protection 557 (7.1) 583 (6.3) 1965 (18.7) previous category

Protection of human environment 976 (12.4) 571 (6.2) 677 (6.4) no data

Protection against harmful effects of waste 1221 (15.5) 1974 (21.4) 2898 (27.6) 4668 (37.1)

Noise and vibration protection 104 (1.3) 147 (1.6) 230 (2.2) 941 (7.5)

Other --- --- --- 513 (4.1)

Total 16.585 (210.0) 13.231 (143.8) 21.310 (202.7) 19.935 (158.6)

Source

: Statistical Yearbook, 1992-1995

Notes

: Original data provided in Hungarian Forints. In converting to US dollars, the average HUF/USD exchange rate for the given year was used.

Environmental technology investments in the energy sector are included in other categories (air, waste, etc.). The first figure in each of the above cells shows the value of investments in millions of Hungarian Forints. The second figure, in brackets, shows the value of investment in millions of US dollars. Highlighted in bold are categories relevant for the purpose of the survey. In analyzing the data above, the following factors relating to the nature of the statistical data collection system in Hungary have to be considered:

data on investments for each year are given in current Forint prices, i.e., figures are adjusted to account for inflation. The inflation rate was 23% in 1992, 22.5% in 1993, 18.8% in 1994, 28.2% in 1995, and estimated 23-24% in 1996.
only expenditures of organizations with more than 50 employees are considered.
the figures do not include environmental technology investments which are made as an integral part of the modification of the technological process, or those which serve to improve occupational health and safety by reducing noise and vibration.

Considering the above, it is likely that actual investments were 10-30 percent higher than indicated.

Assuming the 75% share of environmental technologies, excluding expenditures on nature protection and protection of biodiversity, and allowing an additional 20% to account for companies with less than 50 employees which are not captured in the above statistics, spending on environmental technologies was 151 USD million in 1994, and 127 USD million in 1995.

Comparing the two sets of figures, one can conclude that the Hungarian market for environmental technologies was between USD 164 and 192 million in 1994, and between 127 and 289 million in 1995. Substantial growth is expected in the coming years. Table 3.6 below provides some additional insight into the distribution of environmental investments.

Table 3.6: Distribution of Environmental Investments, in Mln HUF ($Million US)

Category 1992 1993 1994 1995

Construction 7193 (91.1) 7313 (79.5) 14113 (134.2) 12049 (95.9)

Machinery 6763 (85.6) 4467 (48.5) 5776 (54.9) 6133 (48.8)

Other 2629 (33.3) 1451 (15.7) 1421 (13.5) 1753 (13.9)

Total 16.585 (210.0) 13.231 (143.8) 21.310 (202.7) 19.935 (158.6)

Source

: Statistical Yearbook, 1992-1995

Finally, a major change is expected in the financing of environmental protection. Currently, about 75% of total environmental expenditures come from the state budget (including the Central Environmental Protection Fund). At the same time, businesses only contribute 9 per cent. At the end of the 6-year National Environmental Plan NKP, it is expected that the former figure will decrease to 55 per cent, while the share of the business sector will grow to 40 per cent.

Priority Areas for Environmental Protection

With respect to

air pollution

, the energy sector is most responsible for SO2, NOx, solid particles, and CO emissions. Although emissions decreased by between 10 and 40 per cent during the period between 1989 and 1992, this was largely due to a 32 per cent decline in industrial activities. Gaseous emissions from the energy sector are still high, although solid particle emissions have decreased substantially since the early nineties as electrostatic precipitators have been installed in coal and lignite-fired power plants. Emissions from the transport sector are a growing source of air pollution. Transportation and vehicles are by far the main source of air pollution in Budapest, where vehicles contribute more than 60 per cent of local air pollution. Serious problems with traffic-related pollution occur in other Hungarian cities as well.

The total volume of

municipal solid waste

generated in Hungary is currently estimated at 20 million cubic meters annually (approx. 2.5-3 million tons), which is twice as high as the figure in 1980. Between 0.4 and 0.5 million tons (approx. 15% of the total) are used or treated in any way (including incineration), while the remaining part is landfilled. Most municipal waste landfills (which receive a major part of industrial waste as well) will reach capacity limit in the near future. According to the list prepared by the Central Statistical Office, there are 602 landfills operating in Hungary, but some experts think the actual number could be as high as 3000. Many landfills do not meet current technical and environmental requirements, and will have to be modernized or will cease to be used.

Only Budapest, since 1981, has a noteworthy incineration capacity. About half of the city’s waste is incinerated. As no suitable location is available to construct new landfills in the Budapest area, the construction of new incinerator(s) is a possibility.

Approximately 3.3 million tons of

hazardous waste

are produced annually in Hungary. 40 per cent of the total amount is red mud from aluminum processing, which is stored in landfills as no viable recycling technology is currently available. The disposal of the remaining 2 million tons of hazardous waste is one of the most important environmental problems. Currently, one modern hazardous waste landfill is operating in Aszod (with a capacity of 5,000 tons per year), and one modern hazardous waste incinerator exists in Dorog (with a capacity of 25,000 tons per year). Smaller amounts of waste are incinerated in various ovens and kilns. A significant proportion of hazardous waste is stored on-site at the source (in so-called temporary storage facilities), because waste generators are not able (or are not willing) to pay the costs of proper disposal. Existing provisions in the law do allow this.

The government is undertaking a number of actions to address the problem of waste management. Legislation on hazardous waste was adopted on September 1, 1996 (

102/1996. (VII.12) sz. Kormanyrendelet

), while new law on waste management, regulating municipal and non-hazardous industrial waste, is under preparation, and is expected to come into force in 1997. Product fees (“green taxes”) have been imposed on fuels, tires, refrigerants, car batteries and packaging materials (e.g. paper, plastic, glass, metal and other products). The government also intends to establish a nationwide collection and recycling system, and is providing the means for the project through the Central Environmental Fund (KKA). The application mechanism was initiated in 1996.

In Hungary,

water production

(including potable, industrial and agricultural) has decreased from 5,513 million cubic meters in 1992 to 4,554 million cubic meters in 1995. The decrease in water consumption was particularly strong in mining, the energy sector, the processing industry, agriculture and in private consumption, and can be attributed to the decline in industrial activities, and to increasing water prices. Currently, 96 per cent of the Hungarian population has access to the water supply system, but only 53 per cent are connected to sewage systems.

Wastewater treatment

is a serious problem in Hungary, and the lack of adequate sewerage systems in many municipalities is the key cause of the current situation. A number of major cities in Hungary lack proper wastewater treatment facilities. For instance, 80 per cent of wastewater generated in Budapest is discharged into the Danube without any treatment. Overall, only 53 per cent of Hungary's population is served by sewer systems. Of the country's 3,176 towns and villages, 454 have sewer networks and only 400 have wastewater treatment plants. Currently, 54 per cent of generated wastewater is discharged untreated. About 8 per cent of wastewater is only treated mechanically, 36 per cent is treated mechanically and biologically, and only 2 per cent undergoes additional tertiary treatment. In all likelihood, actual proportions are probably even worse, because of the illegal dumping of wastewater. The objective of the government policy is to ensure that 90 per cent of all wastewater is discharged into the sewage system and treated in a proper way by the year 2010.

Currently, about 50 per cent of Hungarian population is exposed to

excessive noise

levels from transportation. As regards

occupational noise protection

, all newly established industrial facilities have to keep the noise level below specified limits, while existing facilities have to comply with the new limits by the year 2010.

Project Opportunities

Major Environmental Problems

Table 3.7 below presents the major environmental issues survey respondents currently face or expect to face in the coming years.

Table 3.7: Major Environmental Problems in Hungary

Category	Problem Description/Expected Duration	Geographic Location
Air	High emissions from obsolete industrial technologies, 10-20 years	National
	SO2 emissions from coal power plants, 10 years	Industrial areas, North-East Hungary, Middle Transdanubia
	Emission of solid particles from surface-mining	Borsod and Heves Counties
	Dust and particulate emissions from cement plants	Dorog, Beremend
	Lack of, or obsolete, technologies for hospital waste incinerators, 30 years	National
	High emission of SO2, NOx & volatile organic compounds energy sector & chemical industry, 10-20 years	Industrial areas
	Air pollution from transportation: soot, lead, aromatic hydrocarbons	National, mainly Budapest & other cities
	Lack of or low quality road system, improper cleaning & maintenance, dust pollution, 30 years	National, major cities
	Insufficient legal framework, poor enforcement, 5 years	National
	High number of concentrated pollution sources	National
	Lack of treatment processes for agricultural NH3	National
Surface & Ground Water	Quality monitoring system is only partially available, 5-10 years	National
	Euthrophication in shallow lakes	Transdanubia
	Infiltration of pesticides, herbicides, fertilizers, as consequence of careless, unprofessional treatment	National
	Hazardous waste dumps, 10-20 years	National, partly unexplored
	Lack of modern abatement technologies to treat organic solvent pollutionnational	South-East Hungary
	Deep-level mines lowering the groundwater level	Borsod country
	Oil pipeline system polluting soil and groundwater	National
	Unexplored pollution caused by organic toxic materials	Industrial areas
Potable Water	High content of Nitrates in potable water	Differs by region
	Unavailable mapping of the vulnerable water reserves, 10 years	National, Northern karst water reserve
	High arsenic content of drinking water	South Hungary
	Lack of up-to-date water treatment technologies	National
	Poor system maintenance; high proportion of water losses in the distribution network	National
Municipal wastewater	Lack of proper sewerage systems and wastewater treatment plants, 20 years	National, especially Budapest & major cities
	Pollution of sink-holes in private households, 20 years	National
	Shortage of available land to dispose of wastewater sludge	National
	Underutilization of wastewater treatment plants built in the last 5-10 years	National
	Illegal dumping of wastewater	National
Industrial wastewater	Obsolete treatment technologies	National
	Pollution of groundwater or other recipient bodies by industrial wastewater discharges	National
	Insufficient treatment of industrial (chemical industry) and municipal wastewater (partial sewage system), pollution of water resources	National
	High organic content of industrial wastewater discharge (directed to the sewage plant)	National
	Lack of a proper solution for the disposal of organic waste and diluted manure in agriculture (potential pollution for water resources)	National
	Lack of proper solution to dispose of sewage sludge (industrial, municipal)	National
Waste	Lack of waste disposal act, inconsistent practice of inspectorates, 1-5 years	National
	Cleaning up of municipal and hazardous waste dumps, 20-30 years	National
	Lack of environmentally acceptable landfills for municipal solid waste, 20-30 years	National
	Lack of hazardous waste incinerators, 5-10 years	National
	Illegal or improper dumping of municipal solid waste and hazardous waste	National
	Cleaning up temporary hazardous waste landfills, 10 years	North Hungary, South Transdanubia
	Disposal of tires, car batteries, spent oil, 5-10 years	National
	Lack of selective waste collection systems, 5 years	National
	Undeveloped waste recycling industry, 1-3 years	National
	Little support from government to the environmental industry, 1-5 years	National
	Lack of correct records on waste stream both for businesses and authorities, 1-3 years	National
Energy	Excessive energy consumption in industry and population, 10-20 years	National
	Lack of national concept to incinerate agricultural by-products for energy production	National
	Low level use of renewable energy sources, 20-50 years	National
	High SO2 emissions from burning coal, lignite, 10-20 years	National
	Bad construction of houses and flats from a heating point of view, over 50 years	National
	Organizational and financing problems of apartment block reconstruction	National
	Obsolete vehicles, low technical level, 10-20 years	National
	Waste rock areas polluting soil, groundwater and air	Mining areas
	Unelaborated energy plans for transportation, industrial production	National
Noise & vibration, occupational health & safety	Deficiencies in urban development policy: residential areas are established in the neighborhood of industrial sites	Major cities
	Excessive noise from transportation, 20-30 years	Major cities
	Lack of local noise protection plans (local governments), 1-3 years	National
	Lack of frequent health checks of employees, 5 years	National
	Lack of emergency response plans (modeling of potential sources of danger, ongoing training of employees), 5 years	National

Interestingly, only a few interviewees indicated a specific location, and were able to estimate the expected duration of the problems. The former may have been caused by the unwillingness to reveal potential areas where the respondents were planning to start activities. The latter suggests that the environmental strategy of the government, (e.g., allocation of financial resources, regulations, action plans, etc.) is not transparent and does not clearly show the urgency and level of priorities. This comment was especially common among R&D sector respondents - business interviewees seemed to have a somewhat better knowledge of government priorities and the most urgent problems needing to be solved.

Significant Environmental Projects Currently in Progress

Respondents from the business sector were not willing to reveal their on-going environmental projects, except for those projects which are coordinated by the government and are therefore well publicized. Listed below are important projects coordinated by various state bodies (the acronyms are explained in Appendix

Water

Sewage water treatment program in Budapest and major cities;
Sewerage and sewage water treatment program to reduce the gap between water supply and access to sewage network (Government Program 20-21/1994, Resources: KKA, KHVM);
Improving the quality Lake Balaton and Lake Velence (including dredging) and setting up a water quality monitoring system.

Air

Harmonization of the Hungarian law on air pollution with EU legislation (monitoring of air quality, setting emission limits for emissions by power plants, etc.)

Other

Varpalota region industrial subprogram for remediation of past environmental damages;
Asbestos program (a national asbestos register will be set up);
Pollution abatement program (action program to identify and address 10-20 local environmental pollution problems most detrimental to human health);
Development of the Hungarian environmental industry to make it internationally competitive (government program will be suggested by IKIM, KTM and the Environmental Committee of the Parliament);
Promoting environmental management systems (informal joint project of IKIM, OMFB, KTM).

For detailed information on current wastewater programs, please contact Mr. Istvan Sindel, Secretary at the Ministry of Environment, Main Department ‘Protection of Natural Elements’ / ‘Water Protection’ Department, tel. (36 1) 201-2137.

For more information on air-related projects, contact Mr. Csoknyai Istvan, Head of Department at the Ministry of Environment, Main Department ‘Protection of Natural Elements’ / ‘Air Protection and Noise Control’ Department, tel. (36 1) 201-4019.

For more details on the Varpalota region industrial subprogram, on the asbestos program, and the pollution abatement program, contact Mr. Csorba Lajos Nebb, Secretary at the Ministry of Environment, Main Department ‘Environmental Development and Safety’ / ‘Environmental Development’ Department, tel. (36 1) 201-5180.

For more information on the Hungarian environmental industry development project, contact Mr. Erno Wittek; for details on the environmental management system (EMS) promotion contact Mr. Istvan Danyi, at IKIM (Ministry for Industry, Trade and Tourism), Main Department of ‘Technological Policy’, tel. (36 1) 118-5180.

Additionally, a number of bilateral and multilateral projects are coordinated by the Ministry of Environment’s ‘European and International Integration’ Department. Major projects currently in progress include :

Table 3.8: Major Bilateral Projects Coordinated by the Ministry of Environment

Country	Topic	Total cost
Switzerland	Wastewater treatment at Pecs Tannery	USD 400,000
	Wastewater treatment at Vajna-Rohod	CHF 7 million (USD 4.8 mln)
	Wastewater treatment at Jaszfenyszaru-Pusztamonostor	CHF 600 thousand (USD 410,000)
	Sewage system at municipalities connected to rivers Tapio-Hajta	CHF 1,2 million (USD 820,000)
	Environmental development of the city of Kecskemet	CHF 1,2 million (USD 820,000)
	Environmental development of the city of Debrecen	CHF 7,7 million (USD 5.3 mln)
	Sludge treatment in Debrecen	CHF 1,6 million (USD 1.1 mln)
	Water quality protection at Lake Velence	CHF 1 million (USD 670,000)
Japan	JICA Study on modernization of the Borsod Power Plant	No Data
	Varpalota and region rehabilitation program, industrial subprogram	YEN 10 billion (USD 80 mln)
	Varpalota and region rehabilitation program, municipal subprogram	YEN 5 billion (USD 40 mln)
	Improving the environment at Lake Balaton	No Data
USA	LEMP, Local Environmental Management Project in Csepel	No Data
	Environmental Management Training Center	USD 200,000
	EPA - Environmental Strategy Project	USD 50,000
	Nitrokemia - wastewater treatment demonstration site	No Data
	Impact of agrochemicals on water quality	HUF 2,7 million (USD 15,000)
	Glicin conjugation on pharmaceutical and environmental toxicology	HUF 3 million (USD 17,000)
	Developing trees resistant to environmental damages	HUF 2,4 million (USD 12,000)
	Submicron emissions from incinerators	HUF 2,5 million (USD 14,000)
	Integrated biological denitrification system	HUF 2,4 million (USD 12,000)
	Land use and cover changes in Szigetkoz	HUF 1,8 million (USD 10,000)
	Aerosol particle characterization	HUF 2,8 million (USD 16,000)
	Entomopatogene nematedes	HUF 3 million (USD 17,000)
	Soil characteristics and forecasts on plant changes	HUF 3,2 million (USD 18,000)
	Genetics of thrichoderms	HUF 3,3 million (USD 19,000)
	Nitrogen and ozone cycle in the forest	HUF 2,6 million (USD 15,000)
	Measurement of CO2 fluctuation in the atmosphere	HUF 2,3 million (USD 13,000)
	Hazardous weather forecast and warning	HUF 2,4 million (USD 12,000)
	Effect of sunspot activity on global changes	HUF 3,5 million (USD 20,000)
	Active sludge bioreactor configuration	HUF 3,2 million (USD 18,000)
	Air quality in Budapest	HUF 3,6 million (USD 20,000)
	Impact of PCBs on the nerve system	HUF 3,6 million (USD 20,000)
	Development of the Hungarian-Slovak-Romanian border water monitoring system	USD 6 million (for 3 countries)
Canada	Canada-Hungary National Parks Project	No Data
France	Methods to slow down the eutrophication Lake Balaton	No Data
Germany	Developing methods for surface mining in an environmentally sound manner	No Data
	Environment-oriented know-how & technology transfer in Pest	No Data
	Cataster for inherited damages	ECU 250 thousand (USD 290,000)
	Environmental assessment of industrial plants prior to privatization	No Data
	Promotion of the Hungarian environmental industry	No Data
	Ecotourism	No Data
	Ecological corridors, wetlands, biodiversity, biomonitoring	DEM 850 thousand (USD 500,000)
	Surveying and evaluation of polluted soils	DEM 250 thousand (USD 150,000)
	Municipal environmental protection - training materials and workshops	No Data
	Assistance in developing the air protection law	No Data
	Impact of Budapest wastewater on water quality in the Danube	DEM 90 thousand (USD 50,000)
	Assessment of past environmental pollution	No Data
	Air quality monitoring system	DEM 100 thousand (USD 60,000)

More details on programs listed in Table 3.9 can be obtained from the following contact persons:

Table 3.9: Contact Points for Bilateral Environmental Projects

Donor Country Contact person Telephone

Switzerland, UK Ms. Zsuzsa Arokhazi (36 1) 201-2243

Japan, USA Ms. Eszter Szovenyi (36 1) 201-3764

Canada, France, Germany Ms. Csillag Deak (36 1) 201-4782

Denmark, Belgium, Holland Ms. Katalin Schreier, Ms. Marta Galambos (36 1) 201-2891

Major Sources of Information on Business Opportunities

Almost all interviewed respondents indicated personal and professional contacts as the main source of information concerning environmental project opportunities. Business and environment-related publications, as well as participation in environmental trade fairs and conferences were other important sources.

The most frequently read environment-related magazines are

'Kornyezetvedelmi fuzetek'

(Environmental Protection Booklets

)

(OMIKK), the magazine

'Kornyezet es Fejlodes'

(Environment and Development)

and the

'Kornyezetvedelmi es V�zugyi ertes�to'

(Environment and Water Protection Bulletin). Most local authorities in Hungary receive the magazine

'Kornyezetvedelem'

(Environmental Protection).

A much higher percentage of interviewed professionals read economic and business newspapers like

'Heti Vilaggazdasag'

(Weekly World Economy)

and

'Napi Vilaggazdasag'

(Daily World Economy). However, environmental project opportunities are rarely mentioned in these publications.

Fairs and exhibitions of environmental technologies are attended by 90 per cent of the interviewed respondents from the business and government sectors, and by 50 per cent of respondents from the R&D sector. Respondents from the latter group participate more often in non-commercial events, such as conferences and symposia. Half of the interviewed businessmen attend one or two events each year, and one third visit at least three fairs.

For comparison, Table 3.10 ranks information sources for business opportunities, based on a 1995 survey of 150 environmental businesses in Hungary carried out by the Regional Environmental Center.

Table 3.10: Major Sources of Information on Environmental Business Opportunities

Source of Information Respondents

Professional Contacts 92%

Personal contacts 91%

Professional Associations 84%

Conference attendance 69%

Environmental Publications 66%

Daily newspaper 62%

Business Publications 59%

Trade shows and Fairs 53%

Environmental Ministry 42%

Mailing Lists 34%

Chamber of Commerce 32%

Other Ministries 32%

Academic Association 27%

Ministry of Industry/Trade 27%

Fax 23%

Other 19%

Local and Regional Government 14%

Email 7%

Source

: REC Report “Emerging Environmental Market” 1995

The findings of the current survey correspond well with the picture from Table 3.10, where personal and/or professional contacts (including conference and trade show attendance) are the major source of information, followed by professional associations, trade shows and fairs, and business and environmental publications. Based on the same 1995 survey, Table 3.11 presents the main business and environmental publications read by Hungarian environmental professionals.

Table 3.11: Main Business and Environmental Publications

Publication Respondents (%)

HVG 35

Kornyezetvedelmifuzetek 34

Napi Vilaggazdasag 28

Cegvezetes 15

Kornyezet es Fejlodes 13

Figyelo 10

Kornyezetvedelmi es vizugyiertesito 6

Budapest Business Journal 8

Piac 6

Source

: REC Report “Emerging Environmental Market” 1995

The role of environmental and trade associations in Hungary is quite limited, as shown in Table 3.12.

Table 3.12: Main Environmental and Trade Associations

Association Respondents Enlisted (%)

Hydrology Society 23

METESZ 12

Chamber of Engineers 10

Association of Chemists 7

Environmental Protection Association 6

Economic Chamber 3

Source

: REC Report “Emerging Environmental Market” 1995

Interestingly, 61% of respondents stated that they did not belong to any professional association. It is therefore surprising that at the same time 84% of respondents indicated professional associations as a source of information for environmental business project opportunities (see Table 4.3a). One can only assume that, through personal contacts, information published by professional associations reaches a wide non-membership audience.

From the limited information received concerning the focus and approximate date of major environmental fairs in Hungary, it appears that participation in environmental fairs and exhibitions is an important, albeit not the major, source of information. Many respondents noted that they are not aware of any central register or publication listing environmental events, even though such a register would be extremely useful for planning one’s attendance of the most important events.

Table 3.13 presents major environment-related fairs in Hungary.

In addition, listed in Table 3.14 are a number of other fairs, mainly with a regional focus, which have an environmental component.

Table 3.13: Major Environment-Related Fairs in Hungary

Name of Fair	City	Approximate Date	Focus
MACH-TECH	Budapest	March, annually	Machine manufacturing technologies
AGRO+MASHEXPO	Budapest	March, annually	Agricultural equipment
AQUA-THERM BUDAPEST	Budapest	April, annually	Heating, ventilation, air conditioning, bathroom fittings, env. technologies
CONSTRUMA	Budapest	April, annually	Construction
Fair and Forum of 'Koztisztasagi Egyesulet (Communal Association)	Szombathely (location not set)	April-March, annually	Municipal solid waste handling
INDUSTRIA OKO-TECH	Budapest	May, annually	Different environmental fields
KOMMUNALEXPO	Budapest	June, annually	Sewage, wastewater treatment, municipal solid waste handling
NATUREXPO	Budapest	August 1996 (one-time event)	Environment protection, nature conservation
BNV (Budapest International Fair)	Budapest	September, annually	General
International Conference and Fair on Energy Conservation and Environmental Technologies	Budapest	October, annually	Energy efficiency and saving
BUDATRANSPACK	Budapest	October, annually	Material handling, packaging

Note: Highlighted in bold are major events

Table 3.14: Other Fairs Partly Focusing on Environmental Technologies

Name of Fair City Approximate Date

CHEMEXPO Budapest March, annually

HUNGAROKORR Budapest April, biannually

VERTESEXPO Tatabanya Spring, annually

GYONGYOSEXPO Gyongyos Annually

EXPO EAST Ny�regyhaza November, annually

Note

: Events listed above generally have a regional focus, and environmental protection is not necessarily the major field

Table 3.15 presents the major environment-related conferences in Hungary.

Table 3.15: Conferences With a Significant Environmental Component

Name of Conference	City	Approximate Date	Focus
National Environmental Days for Local Governments	Budapest	February, annually	Municipal solid waste, water, wastewater, air
National Conference on Transportation and Environment	Budapest	May	Transportation, fuels and lubricants, vehicle manufacturing
National Environmental Information Conference	Budapest	September, annually	General environmental
DAT '9x (International Conference of Database Distributors)	Budapest	October, annually	Special section on recycling
National Conference on Agriculture and Environment	Budapest	November, annually	Environmental issues in agriculture
Conference of the Hungarian Biomass Association	Godollo	annually	Biomass, energetics

Public Procurement Act

The public procurement procedure currently in force in Hungary is a potentially important way to identify environmental business opportunities. Local authorities and governmental agencies are obliged to announce a tender for most investments involving the use of public money, and as the system develops, tender procedures will play an increasing role as a source of information about upcoming projects.

The area is regulated by

Act XI. 1995 on Public Procurement.

Partial regulations on public procurement in Hungary have been in force since November 1, 1995, with comprehensive regulations made effective from January 1, 1996. According to the Act, public investments above a specified value made by the national government and local authorities are subject to a tender procedure. The provisions apply to governmental bodies and local authorities, to associations created by these bodies, as well as to public institutions, public foundations and public utilities. Subject to the public procurement process are acquisitions of products and services, and construction investments.

The specific investment values above which public procurement procedure and tendering become mandatory are determined annually. In 1996, the following limits were applicable:

HUF 10 million (approx. USD 60,000) for product purchases
HUF 20 million (approx. USD 120,000) for construction investments
HUF 5 million (approx. USD 30,000) for construction planning (blueprint)

Both tender announcements and the results of the bidding have to be published in the

Kozbeszerzesi Erteseto

(Public Procurement Bulletin). Regular media receive and can publish the information about a tender only after it has been advertised in the Bulletin.

The tender procedure can be open, closed, or negotiable. Generally, open tenders are the preferred method - the latter two can only be used in cases specified by the Act. Announcement of the project in the Public Procurement Bulletin is the first step in the open tender procedure. The content of the announcement is regulated by law, and includes: documentation required for application, detailed terms of reference, a technical description of the project, and bidding deadlines. After the contract has been awarded, the decision is published in the Public Procurement Bulletin.

The Parliament has enacted two additional pieces of legislation related to public procurement:

1/1996.(II.7.) KTM rendelet: detailed technical requirements for announcements of construction investments subject to public procurement;
125/1996. (VII.24.) KORM. rendelet: detailed rules of public procurement applicable to public institutions financed from the national budget.

Important contact points for environmental project opportunities

Almost all institutions listed in Table 3.16 are active in a number of environmental sectors, and therefore specific environmental sectors are not indicated.

Table 3.16: Contact Points for Information Concerning Environmental Projects

Organization Name and Address	Contact Information
Ministry for Environment and Regional Policy (KTM) 1011.Budapest, Fo u.40-50	Mr. Kovacs, Arpad, tel.: (1) 201-2043, fax. (1) 201-3971 Mr. Farago, Tibor, tel/fax.: (1) 201-4091 Mr. Erdey, Gyorgy, tel.: (1) 201-1407, fax. (1) 201-2819
Secretariat of the Central Environmental Fund (KKA) 1011. Budapest, Fo u. 44-50.	Mr. Sindell, Istvan tel.: (1) 457-3300, fax. (1) 457-3413
PHARE Office (KTM) 1011. Budapest, Fo u. 44-50.	Mr. Donath, Bela tel.: (1) 201-1691, fax. (1) 201-5780
Environmental Inspectorate, Budapest 1011. Budapest, Fou. 44-50	Mr. Varga, Pal tel.: (1) 201-4619, fax. (1) 201-4284
Environmental Service Providers Association (KSS) 1149. Budapest, Angol u. 42.	Ms. Szekely, Anna tel/fax.: (1) 220-2367, tel. (1) 220-2369
Environmental Information Club (KVIK) 1148.Budapest, Limanova ter 25	Mr. Szarvas, Zoltan tel/fax.: (1) 252-8452, tel. (30) 514-520
Hungary-EU Energy Center	Ms.Doris Keszthelyi tel. (1) 269-9067, fax. (1) 269-9065
BAU DATA Project Information and Consulting Bureau 1142.Budapest, Dorozsmai u. 110.	tel.: (1) 252-5454 fax. (1) 252-6518
Environmental Management Institute 1369 Budapest, 5. Pf.352, Budapest, V. Alkotmany u.29.	Dr. Kovacs, Attila tel.: (1) 332-9940, fax. (1) 111-5826
National Association of Waste Recyclers 1066 Budapest, Dessewffy u.3	Mr. Balatoni, Henrik tel.: (1) 111-1477, fax. (1) 131-1516
National Committee for Technological Development (OMFB) 1052 Budapest, Szervita ter 8.	Ms. Ilona Szabo, tel. (1) 117-5900, fax. (1) 118-7998
Public Hygiene Society 2483 Gardony, Pf. 15, Gardony. Bone K. u. 44.	Mr. Nagy, Gyorgy tel.: (22) 355-065, fax. (22) 355-253
Environmental Management and Law Association (EMLA) 1082 Budapest, Ulloi ut 66/ b-I, VI-4	Dr. Kiss, Csaba tel/fax.: (1) 333-2931
Independent Ecology Center 1035 Budapest, Miklos ter 1	Ms. Vasarhelyi, Judit tel.: (1) 180-3420, fax. (1) 250-1546
Environmental Training Program 1112 Budapest, Budaorsi �t 45.	Ms. Eri, Vilma tel.: (1) 185-0777
Regional Environmental Center for Central and Eastern Europe (REC) 2000 Szentendre, Ady Endre ut 9-11	Mr. Pawel Kazmierczyk tel.: (26) 311-199, fax: (26) 311-294
Hungarian Association for Environmentally Aware Management (KOVET-INEM Hungaria) 1063 Budapest, Munkacsy M. u. 16.	Mr. Toth, Gergely tel.: (1) 131-7578, fax. (1) 332-0787
Foundation for Industry 1063 Budapest, Munkacsy M. u. 16	Dr. Tamas Kemeny tel. (1) 312-2213, fax. (1) 332-0787
Danube Circle 1026 Budapest, Gabor Aron u. 33.	Mr. Varga, Janos tel.: (20) 419-096
WWF Hungary 1124 Budapest, Nemethvolgyi u. 78/b	Mr. Markus, Ferenc tel/fax.: (1) 1754-790

There is no “formal” institution or clearinghouse in Hungary collecting and disseminating information concerning environmental business opportunities. As indicated earlier, personal and professional contacts seem to be the most important and effective source of information for project opportunities. Two thirds of respondents indicated that information gathering via official/governmental channels (KTM, OMFB, MTA, OMIKK, EU Energy Center) is “very incidental.”

Sources of Information on Available Environmental Technologies

In general, aside from the ever-present financial constraints, purchasing environmental technologies does not pose any significant problems in Hungary because of the wide range of products available on the market. Representatives of domestic and foreign companies often visit potential clients in person, or contact them by mail, offering products and services. Survey respondents generally believe the market to be saturated.

Based on the interviews, the most common means of gathering information prior to buying environmental technologies include, in order of significance:

personal and professional relations
industry associations
fairs and exhibitions
journals and catalogues
via the foreign owner or parent company
company contacts
professional meetings, discussions, and conferences
references
through chambers of commerce
assistance from environmental inspectorates

Similarly to the situation with information about project opportunities, when purchasing environmental technologies, most domestic Hungarian firms strongly rely on personal contacts, which are the primary source of information. In contrast, foreign firms and joint ventures mostly depend on information provided by the parent company or the foreign partner.

Demand for Environmental Technologies

Demand for Environmental Technologies - Overview

In most categories, demand for environmental technologies in Hungary was estimated to be between moderate and high. Interestingly, respondents indicated a low level of demand in about a quarter of technology categories. There were very few technologies where demand was estimated as “high and likely to grow.” In general, significant demand was identified for energy-related technologies, and technologies related to industrial wastewater treatment and the treatment and disposal of hazardous and radioactive waste.

High demand in the

air sector

Demand for environmental technologies in the

water and wastewater

sector was moderate. The most needed technologies in this category were those for industrial wastewater treatment. High demand was identified for industrial and municipal wastewater sludge treatment and disposal technologies. Technologies where demand is expected to rise included those for the construction of collection networks for municipal and industrial wastewater; water recycling and reuse for potable water and industrial wastewater; spill control and containment/cleanup for surface and groundwater; instrumentation, process control, and software for industrial wastewater; standard and advanced treatment technologies for industrial wastewater; and inspection and reconditioning of existing wastewater collection networks.

Waste management

appears to be one of the most promising environmental market sectors in Hungary. Significant opportunities are anticipated in hazardous waste disposal, followed by radioactive and industrial waste management. High demand was identified for technologies for site remediation/cleanup of contaminated land for hazardous waste; and, for radioactive waste, for equipment for sample analysis/waste characterization; site monitoring; and waste collection, transportation and storage. Demand was expected to rise for pollution prevention/waste minimization equipment for industrial and hazardous waste; technologies for recycling/resource recovery for industrial waste; technologies and equipment for waste collection, transportation and storage of hazardous waste and hazardous waste site monitoring; and technologies for spillage control/decontamination for hazardous waste.

Demand for energy-related technologies was generally high, especially in comparison with other environmental sectors. Technologies where high demand was identified included: instrumentation; and equipment for retrofitting/ rehabilitation of existing systems. Demand was increasing for equipment related to process management and control; new and efficient energy and heat generation systems; and heat recovery and energy saving equipment. The recent privatization of energy utility companies in Hungary is likely to speed up the modernization of the sector, which, combined with stricter air pollution regulations, seems to be the major reason behind the anticipated high demand in the sector. Many experts noted that there were significant market opportunities in decreasing energy losses in production process, transmission, and consumption.

In the

noise, vibration and occupational health and safety

Technologies in Demand by Category

The following tables summarize the responses to the questions on demand for specific environmental technologies.

The following scale was used in ranking :

- highest, and rapidly growing demand,

- high demand, likely to grow,

- moderate, slowly growing demand,

- low demand, will not grow,

- very low and decreasing demand,

blank

- no opinion.

Figures in cells show the average score, while those in brackets represent the number of responses.

Air

Table 3.17:. Demand for Air Quality-Related Technologies

Air	Ambient Air	Gaseous Emissions
Air sampling/laboratory analysis	3.4 (8)	3.9 (7)
Continuous-basis monitoring	2.7 (9)	2.6 (5)
Air pollution control/flue gas purification equipment (e.g. filters, scrubbers)	3.1 (4)	3.6 (7)
Gas detection/warning devices	2.5(4)2.	3.0 (4)
Best available technology for emission abatement at source/cleaner production (e.g., low emission burners)	3.1 (5)	3.4 (5)
Instrumentation and process control/software	4.0 (6)	4.0 (6)

Technologies in demand

#1 instrumentation and process control / software

Technologies where demand is expected to rise:

#2 air sampling / laboratory analysis (gaseous emissions); #3 air pollution control/ flue gas purification equipment.

Most respondents indicated a greater level of demand for air-pollution related technologies for gaseous emissions from stationary sources compared to demand for products related to ambient air. High demand in this category was identified for instrumentation and process control/software. Growing demand was expected for technologies for air sampling/laboratory analysis for gaseous emissions, and for air pollution control/flue gas purification equipment.

Business representatives and government officials seemed to agree that instrumentation and process control/software was an area in high demand.

Respondents from the government sector also indicated growing demand was likely for air pollution control and flue gas purification equipment. The need is driven by Hungary's commitment to cut SO2, NOx and freons, according to international treaties (Geneva, Montreal), and by the harmonization of Hungarian environmental legislation with that of the European Union (a new law on air emissions is expected to come into force in 1997). Interestingly, respondents from the business sector evaluated demand for air pollution control and flue gas purification equipment as moderate, frequently expressing an opinion that no significant growth in spending can be expected unless applicable regulations and the level of enforcement change. Currently, only new investments create demand for this kind of equipment.

Local governments indicated a need for air quality monitoring systems in areas where air is heavily polluted by traffic and vehicles. However, respondents from the business sector did not indicate a high demand for air monitoring systems.

Water and Wastewater

Table 3.18: Demand for Water and Wastewater-Related Technologies

Water and Wastewater	Surface & Ground Water	Potable (drinking) Water	Municipal Wastewater	Industrial Wastewater
Monitoring	3.3 (9)	2.5 (4)	2.7 (9)	3.3 (10)
Sampling/laboratory analysis	3.2 (9)	3.0 (8)	2.6 (11)	3.1 (11)
Construction of collection/supply networks	2.9 (4)	2.5 (5)	3.7 (13)	3.7 (10)
Inspection & reconditioning of existing supply & collection networks	3.3 (4)	3.2 (6)	2.8 (9)	3.5 (10)
Standard physical, chemical, and biological treatment processes	3.0 (1)	3.5 (4)	3.4 (13)	3.5 (12)
Advanced (tertiary) treatment processes	2.8 (4)	3.5 (4)	3.4 (10)	3.5 (12)
Sludge treatment & disposal	3.0 (2)	3.3 (2)	3.7 (11)	4.0 (10)
Best available technology for pollution prevention/waste minimization	3.0 (3)	2.0 (1)	2.5 (2)	3.4 (5)
Water recycling and reuse	3.0 (3)	3.8 (3)	3.3 (7)	3.6 (10)
Spill control and containment/cleanup	3.8 (4)	3.0 (3)	2.8 (6)	2.9 (7)
Quality restoration and decontamination	3.5 (6)	3.4 (5)	3.2 (5)	3.2 (5)
Instrumentation/process control/software	3.0 (3)	3.0 (2)	3.4 (5)	3.7 (7)

Technologies in high demand

#1 sludge treatment and disposal - industrial and municipal wastewater;

Technologies where demand is expected to rise:

#2 construction of collection networks - municipal and industrial wastewater; #3 water recycling and reuse - potable (drinking) water and industrial wastewater; #4 spill control and containment/cleanup - surface and groundwater; #5 instrumentation, process control, and software - Industrial wastewater; #6 standard and advanced treatment - industrial wastewater; #7 inspection and reconditioning of existing wastewater collection networks

Demand for environmental technologies for water and wastewater was moderate. Only in one technology class was demand identified as “high and likely to grow”. The most needed technologies in this category were for industrial wastewater treatment.

High demand was identified for sludge treatment and disposal technologies for industrial and municipal wastewater. Technologies where demand is expected to rise included those for: construction of collection networks for municipal and industrial wastewater; water recycling and reuse for potable water and industrial wastewater; spill control and containment/cleanup for surface and groundwater; instrumentation, process control, and software for industrial wastewater; standard and advanced treatment technologies for industrial wastewater; and inspection and reconditioning of existing wastewater collection networks.

As regards technologies for

surface and ground water

, moderate growth in demand was expected for quality restoration and decontamination, and cleanup technologies. Respondents from the government sector generally gave higher rankings in this category than business representatives. The demand is driven by the threat to water resources from wastewater discharges and soil contamination (e.g., hazardous compounds and hydrocarbon contaminated areas identified in the course of privatization; oil contamination of the Soroksar arm of Danube; dichloroethyl contamination of the water reserves in Szekszard, etc.).

Both groups of respondents expressed similar opinions about the need for water quality monitoring systems, although demand is still only growing slowly. In the municipality of Budapest, however, some 600 monitoring points have already been established for regular checking of water quality, while the levels of radioactivity in the Danube are also inspected regularly.

Among technologies for

potable water,

increasing demand was identified for water reuse and recycling equipment, standard and advanced treatment process technologies, and equipment and technologies for the reconstruction of existing water supply networks. Some experts noted that there was a significant need for water loss and leakage control in water distribution networks, and suggested strong growth potential in this area. Respondents also expected a growing demand for advanced water treatment processes, as currently used equipment rapidly becomes outdated and will have to be replaced. Water-saving household appliances were also increasingly sought as water charges increase.

Demand for technologies for the treatment of

municipal wastewater

is expected to grow in the near future. There is a large gap between the percentage of population with water supply and those connected to a sewage system in Hungary. In response, a large governmental program has been prepared which specifies that wastewater treatment should be available in all communities with more than 2000 inhabitants by the year 2010. As a result, growing demand was identified for construction of wastewater collection networks, standard and advanced wastewater treatment processes, and instrumentation and process control. Several respondents indicated a significant demand can be expected for sludge treatment and disposal technologies, although the major impediments in this field are the shortage of available areas for lagoons, and an unclear situation with respect to land ownership. Finally, although it is not evident from the table, some experts mentioned business opportunities related to upgrading existing wastewater treatment plants, e.g., by adding a biological treatment stage, deepening reservoirs, or introducing modern aeration systems. Significantly, many respondents indicated that suppliers’ ability to mobilize additional financing was a strong competitive advantage.

Finally, increasing demand in

industrial wastewater treatment

was identified for sludge treatment and disposal, instrumentation and process control, construction and modernization of collection networks, water recycling and reuse, and standard and advanced treatment technologies. Opinions were divided on the need for the construction of new treatment plants and collection networks - some experts thought that the decline in industrial production has made existing facilities under-utilized. The demand for advanced (tertiary) treatment technologies is driven by stricter limits for pollutant discharges to receiving water bodies, and by ongoing replacement of obsolete equipment, while the rising costs of water supply are expected to lead to growing demand for water reuse and recycling technologies. Finally, significant demand was identified for industrial wastewater sludge treatment technologies, similar to the situation with municipal wastewater sludge.

It should be noted that, strictly speaking, demand in the category water and wastewater, as identified in Table 5.2b, was moderate. This is surprizing, given the priority given in the state environmental policy to the protection of water resources and improving quality of drinking water. Therefore, in the researcher’s opinion, the technologies where demand is expected to rise will be in high demand in a short time.

Waste Management

Table 3.19: Demand for Waste Management-Related Technologies

Waste Management	Municipal Solid Waste	Industrial Waste	Hazardous Waste	Radioactive Waste
Waste collection/transportation and storage	3.5 (17)	3.3 (17)	3.7 (14)	4.0 (3)
Sample analysis/waste characterization	3.0 (11)	3.5 (14)	3.5 (12)	4.5 (2)
Site monitoring	3.2 (14)	3.5 (12)	3.7 (9)	4.3 (3)
Landfill disposal	3.4 (17)	3.3 (12)	3.0 (11)	2.2 (3)
Incineration	2.4 (14)	2.5 (13)	3.4 (14)	1.0 (1)
Composting/biomass conversion	2.7 (17)	2.7 (10)	3.3 (3)	---
Best technology for pollution prevention/waste minimization	2.9 (10)	3.8 (12)	3.8 (8)	4.0 (2)
Recycling/resource recovery	2.9 (13)	3.7 (15)	3.3 (10)	*---*
Spillage control/decontamination	2.7 (7)	3.0 (8)	3.6 (7)	4.0 (1)
Site remediation/cleanup of contaminated land	2.6 (9)	3.4 (12)	4.3 (10)	*---*

Technologies in high demand:

#1 site remediation / cleanup of contaminated land (hazardous waste); #2 sample analysis/waste characterization; site monitoring; waste collection / transportation and storage (radioactive waste)

Technologies where demand is expected to rise

#3 pollution prevention / waste minimization (industrial and hazardous waste); #4 recycling/resource recovery (industrial waste) #5 waste collection / transportation and storage (hazardous waste); #6 hazardous waste site monitoring; #7 spillage control / decontamination (hazardous waste)

Waste management, according to respondents, is one of the most promising environmental market sectors in Hungary. Significant opportunities are expected in hazardous waste disposal, followed by radioactive and industrial waste management.

Technologies in high demand included: site remediation/cleanup of contaminated land for hazardous waste; and, for radioactive waste, equipment for sample analysis/waste characterization; site monitoring; and waste collection, transportation and storage.

Demand was expected to rise for pollution prevention/waste minimization equipment for industrial and hazardous waste; technologies for recycling/resource recovery for industrial waste; technologies and equipment for waste collection, transportation and storage of hazardous waste and hazardous waste site monitoring; and technologies for spillage control/decontamination for hazardous waste.

Demand for technologies related to

municipal solid waste

management was low to moderate, although growing demand was expected by several interviewees for construction of landfills. The primary obstacles to the construction of new landfills are the rejection by the local population (“not in my backyard” attitude), and the lack of financing - local governments must provide two thirds of project financing (although establishment of regional landfills is supported financially by the government). In the vicinity of Budapest there are also problems with the availability of land. It was noted that suppliers’ ability to attract additional financing was a strong advantage.

Increasing demand was expected for technologies related to waste collection, transportation and storage, as aging existing equipment must be modernized or replaced. With the introduction of selective waste collection systems, demand is likely to increase, and so is the need for temporary storage, sorting and bailing technologies. Respondents active in composting and biomass conversion usually specified higher demand for their services than environmental technology experts in general.

With respect to the treatment and disposal of

industrial waste,

increasing demand was identified for pollution prevention and waste minimization equipment, and resource recovery and recycling technologies. The major factor driving demand is the increasing price of landfill disposal, currently at 500-800 HUF (USD 3-5) per cubic meter of non hazardous industrial waste. The price is expected to double or triple in the near future. Interesting examples of ongoing waste minimization projects include the battery factory Perion, or chemical company Viscosa.. The projects are implemented with the assistance of the World Environment Center /WEC/.

High and increasing demand was identified for

hazardous waste technologies.

The new waste law is a key factor behind this, although it was noted that many companies are not willing to undertake sound waste management practices which are beyond the requirements specified by the law. The highest demand in the entire waste management category was identified for those technologies related to site remediation and cleanup of contaminated land, which often results from the current practice of “temporarily” storing hazardous waste on-site until a suitable disposal method is identified. For instance, the Budapest Chemical Works (

Budapesti Vegyimuvek

) has thousands of drums of hazardous chemicals stored in Gare, in southern Hungary. Finally, a high number of legal and illegal (uncatalogued) hazardous waste disposal sites will have to be remediated.

Hazardous waste generation, currently stagnant because of the decline in industrial activities, is expected to increase as the economy expands. However, there is still no system in place for the proper management of hazardous waste. Only one major hazardous waste incinerator is currently operating in Hungary (in Dorog, with a capacity of 25,000 tons per year) while a few smaller incinerators, mostly outdated, are used at industrial sites or hospitals. Generally, the disposal of hazardous waste is based either on landfilling, or the use of “temporary” storage sites as discussed above. No decision has yet been made about the number and location of new hazardous waste incinerators (financing is not secured yet, either), while the construction of new landfill sites is hampered by the shortage of suitable locations. This situation, combined with rapidly growing waste disposal prices and stricter regulations, is the key factor behind the identified growth in demand for technologies relating to pollution prevention and waste minimization. It is worth noting that pollution prevention and waste minimization are two of the major priorities in the current environmental policy prepared by the government.

A growing demand was also identified for technologies for waste collection, transportation, and storage of hazardous waste, as well as for equipment providing for continuous monitoring of existing landfills.

Finally, a high and growing demand was indicated for most technologies related to

radioactive waste

management (especially for sample analysis and waste characterization, site monitoring, and waste collection and transport). However, it is necessary to stress that even though the few respondents who addressed the issue expected a high and growing demand, in terms of market share, radioactive waste management makes up only a small proportion of the entire waste management market in Hungary.

Energy

Table 3.20: Demand for Energy-Related Technologies

Energy	Energy and Power Generation	Other Industrial Sectors
New/efficient energy & heat generation systems	3.6 (8)	3.8 (6)
Retrofitting/rehabilitation of existing systems	4.0 (6)	3.8 (6)
Process management and control	3.9 (7)	3.9 (7)
Heat recovery and energy savings	3.6 (8)	3.7 (7)
Alternative/renewable energy systems	2.7 (6)	2.5 (4)
Alternative (non-CFC) refrigerants	3.4 (5)	3.5 (4)
Instrumentation	3.9 (7)	4.0 (5)

Technologies in high demand:

#1 instrumentation; #2 retrofitting/rehabilitation of existing systems;

Technologies where demand is expected to rise

#3 process management and control; #4 new and efficient energy and heat generation systems; #5 heat recovery and energy savings

Demand for energy-related technologies was generally high, especially in comparison with other environmental sectors. There were also remarkably few differences between the expected demand in the energy and power generation sector, and in other (energy-consuming) industrial sectors.

Technologies where high demand was identified included: instrumentation; and equipment for retrofitting/rehabilitation of existing systems. Demand was increasing for equipment related to process management and control; new and efficient energy and heat generation systems; and technologies related to heat recovery and energy savings.

The recent privatization of energy utility companies in Hungary is likely to speed up the modernization of the sector, which, combined with stricter air pollution regulations, seems to be the major reason behind the expected high demand in the sector.

Although it is not immediately obvious from the table, many experts noted that there were significant market opportunities in decreasing energy losses in production process, transmission, and consumption, and expected that demand for heat recovery and energy saving technologies will grow in the near future. According to some studies, it is possible to improve the efficiency of central heating systems and older gas heating installations in a cost-effective way, through changing obsolete equipment and modernizing distribution systems. The planned introduction of a billing system based on actual energy consumption is likely to further stimulate the demand for energy saving technologies. A governmental program is under preparation to help finance the modernization of about one fifth of all Hungarian flats (approx. 700 thousand) in concrete block apartments, via improved insulation and better heating systems.

Similar to other market sectors, suppliers who are able to mobilize additional financing enjoy a competitive advantage, because the modernization of heating systems requires high investment, currently not available to potential investors. Interestingly, some foreign assistance to the sector is already available in Hungary (e.g., the German government-funded project to increase energy efficiency in prefabricated concrete blocks of flats).

Noise, Vibration, and Occupational Health and Safety

Table 3.21: Demand for Noise, Vibration, Occupational Health and Safety Related Technologies

Noise, Vibration, Occupational Health & Safety	Noise & Vibration	Occupational Health & Safety
Instrumentation/measuring and control devices	2.5 (6)	3.3 (4)
Protection equipment	3.0 (4)	4.0 (2)
Abatement (insulation, absorbtion)	3.7 (6)	4.0 (4)
Electromagnetic field exposure	2.5 (2)	3.0 (1)

Technologies in high demand:

#1 abatement (OHS) ; #2 Protection equipment (OHS)

Technologies where demand is expected to rise

abatement (noise and vibration)

Noise, vibration and occupational health and safety is clearly the most neglected sector among all surveyed during the research. High demand was identified for abatement technologies (e.g., insulation, absorbtion) and for protection equipment in the occupational health and safety sector. As workplace safety and liability issues become more significant in Hungary, demand is expected to grow.

Increasing demand was also identified for noise abatement technologies in the construction industry (e.g., insulation and absorbtion materials for use at airports, along busy roads, and in the vicinity of industrial plants with excessive noise levels).

Major End-Users of Environmental Technologies

Table 3.22 presents the major groups of end users of environmental technologies, as identified by the respondents.

Table 3.22: End Users of Environmental Technologies

Category	End User by Sector
Air	Energy sector, power plants, chemical works, transportation, waste incinerators, metallurgy
Water and Wastewater	Municipal water and wastewater service companies, chemical industry, energy sector, mining, food processing industry, pharmaceutical industry, textile industry, agriculture (diluted manure)
Waste	Municipal service companies, mining, energy sector, other industries (construction, textile, paper, food), aluminum industry (red mud), agriculture
Energy	Municipal energy supply companies, energy and power generation sector (production and service), raw material processing industry (steel, aluminum), chemical industry
Noise, Vibration, Occupational Health & Safety	Transportation, public transport, all manufacturing activities, industrial sites located in residential areas, energy sector, textile industry, airports

According to respondents, the energy and power generation sector and municipalities are the main end-users of environmental technologies across all categories. The chemical industry, and other raw material extraction and processing industries are also significant end-user groups.

Additionally, the transport sector was identified as a significant end-user of technologies for air pollution control, and noise and vibration abatement. Water and wastewater, and waste management technologies are widely used in the mining sector, agriculture and food processing, and textile industry.

Interestingly, the ranking of end-users in each sector, and especially the high position of municipalities, reflects the decline in industrial production in the period since 1991, when many factories ceased operation owing to financial constraints. The closures resulted in a decrease in industrial pollution and discharges. This, combined

with the fact that many significant environmental problems in industry have already been solved, has led to the municipal sector being one of the major end-users of environmental technologies.

Advantages and Disadvantages of Foreign Suppliers

Purchasing Preferences

In discussing purchasing preferences with Hungarian experts, the country of origin of a particular environmental technology was indicated not to be a determining factor. Instead, 5 out of 6 respondents preferred to consider product quality and references. One interviewee in six opted for domestic technology wherever possible, although a major obstacle to buying domestic products is that they are not available in certain fields (e.g., water treatment technologies, flue gas purification).

Among those respondents purchasing foreign environmental technologies, about half buy directly from a foreign supplier, while the remainder buy from local representatives. Buyers frequently opting for direct purchases included foreign-owned firms or joint ventures, and clients requiring customized and very specialized technologies. In the latter category, it was noted that direct purchase is often the only option, because a local Hungarian office often does not exist. In respondents’ opinion, when a local representative office does exist, the foreign manufacturer usually does not carry out direct sales, directing clients to the local representative instead. With the growing number of in-country representatives, local purchase is expected to increase.

Opinions of respondents from the R&D sector with respect to foreign suppliers were restricted to laboratory equipment, instruments, and pilot technologies. Similar to other respondents, product quality and references are considered first. Purchases are made, in roughly equal proportion, from local representatives and from producers abroad. In general, direct purchases were preferred where previous contacts with the supplier were established, or where higher quantity orders were made.

Strengths of Foreign Environmental Technologies

About 50% of respondents specified the high quality, reliability and durability of products as advantages of foreign technologies. A third of respondents believed foreign environmental technology products offered good value for money, and were user-friendly and easy to operate.

A third of respondents regarded available credit or other forms of funding from a foreign supplier as a major advantage. Interestingly, several respondents noted that, in practice, foreign financial support often was not fully effective, either because no Hungarian financial institution would become a co-financing partner in such schemes, or, when they did, the stipulated conditions would make borrowing (even with preferential foreign financing) as expensive as borrowing from a bank.

Opinions were divided with respect to the quality of after sales service - some respondents believed it was good, while others stated that service was poor, unpunctual and unreliable.

Barriers to Buying Environmental Technologies from Abroad

By far the major barrier to buying foreign environmental technologies in Hungary is price. 80% of respondents mentioned high price was the major disadvantage of foreign products. About a quarter of interviewees regarded foreign technologies as not suited to local conditions and technical culture (e.g., measurement standards are different, the equipment is not of the proper size, etc.).

Other obstacles (mentioned by about 15% of respondents) included high customs duties, changing environmental regulations, difficulties to ensure local technical service, communication problems with foreign suppliers (mainly with respect to language), and the lack of information concerning suppliers.

Fifteen per cent of the interviewed experts did not experience any problems with buying environmental technologies from abroad.

Major Foreign Suppliers in the Environmental Technology Market

Perception of Environmental Technologies from Selected Countries

Austria and Germany are by far the major players on the environmental technology market in Hungary, followed by Holland, France, USA, Japan and Scandinavian countries. In individual sectors, the perceptions of foreign environmental technologies was as follows:

Table 3.23: Perceptions of Environmental Technologies From Selected Countries

Sector Country

Air Germany, Austria, Japan

Water and wastewater Germany, Austria, Holland, France, US

Waste Austria, Germany, France, US

Energy Germany, Holland, US

Noise, vibration, and OHS Scandinavia (Denmark, Sweden), Japan, US

Austrian and German environmental technologies enjoyed good to excellent reputation in the air, water and wastewater, waste management, and energy sectors. Perception of American technologies was good in water and wastewater, waste management, energy, and noise, vibration, and OHS sectors.

Dutch technologies were rated high in the water and wastewater and energy sectors, while French products were evaluated highly in the water and wastewater, and waste management sectors. Environmental technologies from Japan were rated well in air pollution, and noise, vibration, and OHS sectors.

As regards perceptions of American technologies, respondents rated American waste treatment technologies as good to excellent (average value 4.5), and water and wastewater-related technologies and air-related technologies as good (average values 4.3 and 4.4, respectively). Among American products, waste management technologies, followed by wastewater and air-related products, received the highest number of responses.

Major Foreign-owned Suppliers in the Market

Table 3.24 presents the main foreign environmental technology suppliers active in Hungary.

Table 3.24: Major Foreign Suppliers of Environmental Technologies

Company Name	Country of Origin	Specialization	Competitive Strengths & Weaknesses
Air
EROTERV-WAGNER-BIRO Kornyezetvedelmi Kft, Budapest	Austria-Hungary	Pneumatic delivery systems, scrubbers, dust removal technologies
HUNGAROPANOL Legtechnikai, BerendezeseketGyarto Rt, Csongrad	France-Hungary	Solid material filtering beds, air conditioning systems	Major player
KGYV Rt, Budapest	Germany- Hungary	Filters, flue gas purification	Good references, modern technology, 30 years local experience
Dr�ger Hungaria Kft, Budapest	Germany	Air emission measurement, soil examination
AGA Gaz Kft, Budapest	Sweden	Recovery of solvents/chemicals from gaseous emissions & flue gas
CH2M Hill	USA	Air related services and consulting	50 year experience in the US, well established in Hungary
Water
FREY Hungaria Kft, Budapest	Austria	Oil-contaminated wastewater treatment/degreasing
Purator Hungaria Kft, Budapest	Austria	Wastewater treatment
EnvirotechAustria, Hungary
SADE Kft, Szeged	France	Water supply systems, water treatment
OMS-Hungaria Kft, Tata	Germany	Biological treatment process, aerobic stabilization of sludge	Permission for all areas, modern technology, full service
Multiproject Kft, Budapest	Germany-Hungary	Municipal wastewater treatment plants
ABS/Komtech Ltd	Germany	Pumps and mixers	Significant share of the market high product quality
Hansa-Plastic	Germany	PVC pipes
EMU	Germany	Pumps
BIOGEIST Kft, Budapest	Germany	Municipal wastewater treatment plants
ITT Flygt	Sweden	Pumps and mixers	Well experienced in Hungary, market leader
Elgoscar International Kft	USA, Hungary
Pannonpipe		PVC pipes	Leading supplier
Wavin-Pemu		PVC pipes
Waste
AKSD, Debrecen	Austria (ASA, Kropfel, Speizer)	Municipal services	Operates own landfill site
ASA Magyarorszag Kft, Budapest	Austria	Municipal and industrial waste disposal
PYRUS-FOLDGEP Kft, Budapest	Austria	Hazardous waste disposal	Landfill facility in Hungary
Rumpold Hungaria Kft	Austria	Municipal waste	Well experienced
Dorog Waste Incinerator Kft, Dorogthe	France	Incineration of hazardous wastes	Only hazardous waste incinerator in Hungary
BIOKOM Kft, PecsFrance	Hungary	Municipal services	Responsible for Transdanubian waste recycling program
ERECO Kelet-Europai Hulladekfeldolgozo es Kornyezetvededelmi Rt, Budapest	France	Collection and disposal of municipal and industrial waste	Modern technology, market leader
Avermann-Hungaria Kft, Barcs, Budapest	Germany	Production of compacting containers, waste collection	Good connections in the local area
REM Kft, Budapest	Germany (RWE Entsorgung)	Waste management	Diverse background, including energy sector companies
OTTO Magyarorszag Kft, Budapest	Germany	Collection and transport of municipal waste	Good connections-local area, prices determined with local authorities
Becker-Pannonia Kft, Budapest	Germany	Collection and delivery of municipal wastegood	Connections in the local area, prices decided with the local government
Rethman Kft, Budapest	Germany	Collection and delivery of municipal waste	Good connections-local area, prices decided with the local government
Eszak Dunantuli MEH	Hungary, Italy	Trade in metal waste and secondary raw materials
Comszolg Kft, Miskolc	USA, Hungary	Collection and delivery of municipal waste	Good connections-local area, prices decided with local government
CEVA Hungary Kft	USA, Hungary	Thermal soil cleaning
Jaycor	USA	Site remediation, soil cleaning
CH2M Hill	USA	All waste related services and consulting	Well established in Hungary
Energy
Energie und Gebaude GmbH	Austria	Energy supply systems-buildings
Ganz-Rock Kazan es Eromuvi Berendezesek Rt, Budapest	Austria-Hungary	Design /production of energy-related equipment
Rockwool Hungaria Kft, Budapest	Denmark	Production and distribution of rockwool for insulation
EROTERV-IVO Power Engineering Rt, Budapest	Finland, Hungary	Design of energy production and distribution systems
Prometheus Rt	France	Full range of energy-related services	Full service, EBRD program participant on energy efficiency
Energiagazdalkodasi RT, Budapest	Germany, Hungary	Pollution control in power plants
Mannesmann Anlagenbau Hungaria Kft, Budapest	Germany	Heating and cooling systems, energetics	Complete services for buildings
Matrai Eromu Rt, RWE-EVS consortium	Germany	Energy production
VEW Energie Hungaria Kft, Budapest	Germany	Energy efficient use of natural gas
Magyar Bycosin Kft	Sweden
ABB Energy Kft, Budapest	Sweden	Energy distribution, transport
Tiszai Eromu RT, AES Summit Generation Ltd	USA	Energy production
TUNSGRAM Rt, Budapest	USA	Energy efficient lamps	One of the largest R&D centers in Hungary
CEVA Hungary Kft	USA, Hungary	energy recovery from oily wastes
KIPSZER Kazantechnologia Kft		Boiler technology
Intertraverz Rt		Not willing to disclose any information
Noise, vibration, and OHS
KG-Filter Kft.	Austria, Hungary	Noise control, noise absorbers, filtering technology	local manufacturing facilities
Bruel and Kjaer Kft	Denmark	Noise measurement instruments, analyzers	Advanced technology, excellent quality
MSA-AUER Hungaria Biztonsagtechnikai Kft, Budapest	Germany, USA	Protection equipment for workers, respiratory protectors, protective clothing

Respondents’ level of knowledge of foreign technologies was generally low, and few were able to describe in detail any foreign companies. As a result, Table 3.24 is based to a large degree on a review of literature and environmental fair catalogues, as well as the researcher’s own knowledge.

Overall, foreign companies were most active in the energy, water and wastewater, and waste management sectors, followed by air protection. Little activity was noted in the noise, vibration, and occupational health and safety sector.

air

, and the related

energy

sector, German, Austrian, and American companies were most active. German firms dominated the

water and wastewater

sector, followed by Austrian, French and American suppliers. In the

waste management

sector, German, Austrian, French, and American companies were most active and seemed to be represented quite evenly.

Interestingly, although Dutch and Japanese suppliers were generally well respected as foreign suppliers, not a single firm from these countries was listed by respondents when asked to name a specific company.

Experience with US Environmental Technologies

Experience with American environmental companies and products was found to be limited - only 12% of interviewed organizations have purchased US environmental technologies. A further 20% considered buying American products. In the latter group, some respondents actually negotiated with a supplier, while others only researched product information. In those cases where no purchase was made, the main reasons included objective circumstances, (e.g., long distance), the lack of references, and negative perceptions of a potential supplier, such as “suppliers are income and not quality oriented,” or “after sales service is poor.”

The general opinion of the respondents from the business sector was that the availability of American environmental technologies on the Hungarian market is limited. One possible explanation for this is the fact that the available products are costly, local direct presence of American companies is insufficient, and after-sales service is limited. In attempting to account for the reasons, some survey respondents expressed a plausible opinion that companies owned by American investors purchase environmental technologies directly from a US supplier. As a consequence, many products are not highly visible on the local market.

Opinions on the quality of American environmental technologies were divided. Some interviewees spoke of excellent instrumentation technology, while others rated “average” water treatment technologies.

The critical attitude outlined above is contrary to the rating of perceptions of American suppliers, discussed in the previous sections, where the survey indicated favorable perceptions of American environmental technologies (between good and excellent).

Another finding of the survey is that even those American environmental technology providers who have an affiliate or a representative office in Hungary (e.g., Advanced Pollution Instruments, Environmental System Corporation, EKTO, HYDROLAB, SENSIDYNE) are not well known on the local market. This indicates an opportunity to increase sales through the better marketing of products and services.

Finally, many interviewees noted that a wide range of environmental technologies are available from American companies, ranging from those now obsolete to the most modern and sophisticated. Customer's financial potential, and the effort put into collecting information and gaining references generally determined which technology was bought.

Appendix A: List of Abbreviations

BME	Budapesti Muszaki Egyetem	Budapest Technical University
Bp.	Budapest	Budapest
GATE	Godoll�i Agrartudomanyi Egyetem	Godoll� University of Agriculture
IKIM	Ipari, Kereskedelmi es Idegenforgalmi Miniszterium	Ministry for Industry, Trade and Tourism
KHVM	Kozlekedesi, H�rkozlesi es V�zugyi Miniszterium	Ministry of Transportation, Communication and Water Management
KKA	Kozponti Kornyezetvedelmi Alap	Central Environmental Fund
KTM	Kornyezetvedelmi es Teruletfejlesztesi Miniszterium	Ministry for Environment and Regional Policy
OKTK(T)	Orszagos Kiemelesu Tarsadalom-tudomanyi Kutatasok (Titkarsaga)	Nationally Prioritized Social Science Research (Secretariat)
OMFB	Orszagos Muszaki Fejlesztesi Bizottsag	National Committee for Technological Development
OMIKK	Orszagos Muszaki Informacios Kozpont es Konyvtar	National Technical Center and Library
OTKA	Orszagos Tudomaynos Kutatasi Alap	Hungarian Scientific Research Fund
MTA	Magyar Tudomanyos Akademia	Hungarian Academy of Sciences
NKP	Nemzeti Kornyezetvedelmi Program	National Environmental Program
OECD, OCDE	Gazdasagi Egyuttmukodesi es Fejlesztesi Szervezet	Organization for Economic Co-operation and Development
REC	Kozep es Kelet Europai Regionalis Kornyezetvedelmi Kozpont	The Regional Environmental Center for Central and Eastern Europe
SZEVIKI	Szerves Vegyipari Kutato Intezet	Research Institute of Organic Chemistry
TEFA	Teruletfejlesztesi Alap	Regional Development Fund

Appendix B: List of Interviews

R&D sector

1. Dr. Barotfi, Istvan. Head of Department, GATE Dep. of Environmental Technology, 28 Oct. 1996

2. Mr. Rab, Attila. Scientific coordinator, Paper Industry Research Institute Ltd., 01 Nov. 1996

3. Dr. Raisz, Ivan. manager of environmental laboratory, Miskolc University, 05 Nov. 1996

4. Dr. Szabo, Istvan. scientific deputy director, MTA Technological Chemical Research Institute, 06 Nov. 1996

5. Dr. Hlavay, Jozsef. vice rector, Veszprem University, 06 Nov. 1996

6. Dr. Csikar, Zsolt. chief engineer, BME Chemical Engineering Development Laboratory, 07 Nov. 1996

7. Dr. Zotter, Katalin. deputy director, Vituki Consult Co., 07 Nov. 1996

8. Dr. Kortvelyesi, Gyula. scientific director. SZEVIKI Co., 07 Nov. 1996

9. Dr. Fenyvesi, Laszlo. scientific department leader, Ministry for Agriculture Technological Institute, 11 Nov. 1996

Government and Administration

10. Ms. Gara, Dr. Nagy Katalin. chief councelloor. KTM Surface Water Protection Dep. 11 Nov. 1996.

11. Mr. Toth, Robert. chief councellor. KTM Air and Noise Protection Dep. 14. Nov. 1996.

12. Mr. Nebb-Csorba, Lajos. secretary. KTM-KVH Environmental Protection Development & Env. Safety Dep. 18. Nov. 1996.

13. Dr. Varga, Pal. dep. director. KTM Cheif Environmental Inspectorate. 05. Dec. 1996.

14. Mr. Malyinko, Zoltan. environmental officer. Eger Local Government. 06. Nov. 1996.

15. Mr. Meleg, Zoltan. environmental officer. Budapest . Local Government. 22. Nov. 1996.

16. Mr. Papa, Agoston. environmental referent. Szekszard Local Government. 12. Nov. 1996.

17. Mr. Rigo, Istvan. chief councellor. Kaposvar Local Government. 19. Nov. 1996.

18. Ms. Sandor, Gabor. councellor. IKIM 07. Nov. 1996.

Business

19. Mr. Kiss, Tibor, exewcutive director. Biokom Kft. 21. Nov. 1996.

20. Mr. Balatoni, Henrik. president. Association of Waste Recyclers / Fegroup Invest executive director. 07. Nov. 1996

21. Mr. Balog, Janos. technical director. Heliosz Kft. 04. Nov. 1996.

22. Mr. Vamos, Istvan. chief engineer. Szekom Kft. 14. Nov. 1996.

23. Ms. Pintye, Agnes executive. Transdanubia-waste Kft. 18. Nov. 1996.

24. Mr. Balint, Jozsef. executive. Waste Kft. 21. Nov. 1996.

25. Mr. Frisch, Mihaly director. Biokor Kft. 22. Nov. 1996.

26. Mr. Botond, Gyorgy. executive. DHV Kft. 11. Nov. 1996.

27. Mr. Perenyi, Miklos. executive. Senex Kft. 21. Nov. 1996.

28. Mr. Morvay, Kalman. executive. Porr Kft. 18. Nov. 1996.

29. Mr. Voros, Laszlo executive. Injektor Kft. 19. Nov. 1996.

30. Mr. Toth, Peter. office director. Purator Hungaria Kft. 20. Nov. 1996.

31. Mr. Nagy, Karoly executive. Oko-Tech Bt. 05. Nov. 1996.

32. Dr. Paller, Gaspar. executive. Envirotech Kft. 21. Nov. 1996.

33. Mr. Abraham, Lajos. general manager. Zold-Lanc Logisztikai Rt. 05. Nov. 1996.

34. Mr. Berhidai, Geza. deputy director. Rumpold Hungaria Kft. 18. Nov. 1996.

35. Mr. Millei, Lajos. executive director. Implantronik Kft. 19. Nov. 1996.

36. Mr. Soos, Janos. executive director. CEVA Magyarorszag Kft. 19. Nov. 1996.

37. Ms. Busa, Ferenc executive director, Hungacorr Mernoki Iroda. 11. Nov. 1996.

38. Dr. Szipner, Istvan. department manager. GEA-EGI Energiahatekonysagi Iroda. 07. Nov. 1996.

39. Ms. Izsak, Judit. executive director. ITENVIRO Kornyezetvedelmi Kft. 08. Nov. 1996.

40. Mr. Zsuffa, Laszlo. executive director. Energetikai, Kornyezetvedelmi es Faipari Kft. (E.K.F.M) 13. Nov. 1996.

41. Mr. Magyar, Sandor. deputy director. Prometheusz Tuzelestechnikai Rt. 14. Nov. 1996.

42. Ms. Varga, Maklary Eleonora. technical manager. Gyori Hulladekegeto Kft. 12. Nov. 1996.

43. Mr. Egerszegi, Janos. executive director. ERM Hungaria Kft. 12. Nov. 1996.

44. Mr. Demeter, Bela. executive director. TERRA-VITA Kft. 19. Nov. 1996.

45. Ms. Dobos, Laszlo. department leader. TUV-Rheinhland Hungaria Kft. 20. Nov. 1996.

46. Mr. Papp, Zoltan. chief engineer. Fovarosi Levegotisztasagi Kft. 19. Nov. 1996.

47. Ms. Sziraky, Klara. executive. S.P.Office Kft. 22. Nov. 1996.

48. dr. Mihalffy, Pal. department director. Autoipari Kutato Rt. 11. Dec. 1996.

49. Mr. Gofarasy, Zoltan executive. FOBA Kft, 11. Dec. 1996.

Personal Discussions

1. Dr. Barotfi, Istvan. Head of Department, GATE, Godollo,1996, Oct. 24.

2. Dr. Lang, Istvan. MTA consultant to the president, Budapest, 1996, Nov. 1.

3. Szodi, Imre. MP Environmental Committee, Budapest, 1996, Oct. 29.

4. Dr. Tamas, Pal. director of MTA Research Institute of Social Conflicts, Budapest, 1996, Nov. 1.

5. Kovacs, Sandor. IKIM head of department, Budapest, 1996, Nov. 14.

6. Sindelyes, Gabor. KTM deputy head of chief department, Dep. of Research and Development, 1996, Nov. 28.

7. Dr. Poos, Miklos. IKIM head of Energy Management Dep. 1996. Nov. 15.

8. Mr. Mezo, Bela. executive. Durisol Hungaria Kft. Szekesfehervar, 1996. Nov. 28.

9. Mr. Olah, Peter. EHS European director. GE. 1996. Dec. 03.

Appendix C: List of publications

Catalogue of research institutions in the fields of environment protection and environmental management,

Budapest, 1990

2. Central Statistical Office (KSH),

Yearbooks of 1993, 1994, 1995

3. Dr. Barotfi, Istvan (ed.):

Environmental technology handbook

, Budapest, 1990.

4. Dr. Kovats, Attila:

Protection against noise and vibration,

Veszprem, 1995.

Energy Policy of Hungary

, 1995 survey. (International Energy Agency)

Environmental Future of Hungary

, 1994, MTA-KTM project

7. Environmental Industry Database (Internet: http:/www.aszsz.eunet.hu)

8. Incomes and Expenditures of the National Environmental Protection Fund

9. INEM:

Case Studies in Environmental Management in Smal and Medium-Sized Enterprises,

Wedel (Holstein), 1996.

10.

Investment Statistical Definitions, terms

, 1995 (KSH, Budapest, 1994)

11. KTM:

National Environmental Program (NKP) - Draft

, Budapest, 1996.

12. OECD:

The Environment Industry and Markets in Selected Central and Eastern European Countries,

Paris, 1995.

13. OMFB, KTM:

R&D Program of Environment Protection for the years 1996 - 2000 - Draft,

Budapest, November 1996.

14. REC:

The Emerging Environmental Market - A Survey of the Czech Republic, Hungary, Poland, and the Slovak Republic,

Budapest, 1996 June.

15. REC:

The Environmental Business Directory - Environmental Service and Technology Providers in the Czech Republic, Hungary, Poland, and the Slovak Republic,

Budapest, 1996 June.

16. Remenyi, Karoly:

Novel Technologies in Energetics,

Budapest, Academic Publisher

17.

Situation of Hazardous Waste Materials in Hungary

, KTM, 1994

Appendix D: Useful contacts

Please note that environmental technology firms are not included in the following table. For contact information and description of firms, see the database of the Environmental Service Providers (KSZSZ) on the World Wide Web:

http://www.c3.hu/~enviserv

Organization name and address	Contact information
Central Environmental Fund (KKA) 1054 Budapest, Alkotmany u. 29.	Mr. Laszlo Danko, (1) 112-2067
Secretariat of the Central Environmental Fund (KKA) 1011. Budapest, Fo u. 44-50.	Mr. Istvan Sindell tel.: (1) 457-3300
Ministry for Agriculture, Technological Institute 2101 Godollo, Tessedik Samuel u. 4.	Dr. Laszlo Fenyvesi, (28) 320-960
Ministry for Environment and Regional Policy (KTM) 1011.Budapest, Fo u.40-50	Mr. Kovacs, Arpad, tel.: (1) 201-2043 Mr. Farago, Tibor, tel.:201-4091 Mr. Erdey, Gyorgy, tel.: (1) 201-1407
Ministry for Environment and Regional Policy (KTM), Dep. of R&D 1011 Budapest, Fo u. 44-50.	Mr. Gabor Sindelyes, (1) 201-2934
Ministry for Industry, Trade and Tourism (MIKI, Dep. of Technological Policy 1051 Budapest, Vigado u. 6.	Mr. Erno Wittek, (1) 118-5180
National Association of Waste Recyclers 1066.Budapest, Dessewffy u.3	Mr. Balatoni, Henrik tel.: (1) 1-111-1477, or 1-131-1516
MTA, Technological Chemical Research Institute 8200 Veszprem, Egyetem u.2.	Dr. Ivan Szabo, (88) 425-206
National Committee for Technological Development (OMFB) 1052 Budapest, Szervita ter 8.	Ms. Ilona Szabo, (1) 117-5900
Organic Chemistry Research Institute (SZEVIKI) 1085 Bp, Stahly u. 13	Dr. Gyula Kortvelyessi, (1) 118-7741
PHARE Office (KTM) 1011. Budapest, Fo u. 44-50.	Mr. Bela Donath tel.: (1) 201-4170
Environmental Management Institute 1369 Budapest, 5. Pf.352 Budapest, V. Alkotmany u.29.	Dr. Kovacs, Endre tel.: (1) 132-9940
Environmental Service Providers Association (KSZSZ) 1149. Budapest, Angol u. 42.	Ms. Szekely, Anna tel.: (1) 220-2367
VITUKI Consult Rt. 1095 Bp, Kvassay J. �t 1	Dr. Katalin Zotter, (1) 216-5810
Development Laboratory on Chemical Engineering, Budapest Technical University (BME) 1521 Bp, Muegyetem rkp. 9	Dr. Zsolt Csikar, (1) 463-3183
Central European University, 1051 Budapest, Nador u. 9.	Prof. Diana Vorsatz (specialty: energy efficiency) (1) 327-3095
Danube Circle 1026. Budapest, Gabor Aron u. 33.	Mr. Vargha, Janos tel.: (20) 419-096
Environmental Information Club (KVIK) 1148.Budapest, Ors Vezer ter 20	Mr. Szarvas, Zoltan tel.: (1) 1- 222-9589
Environmental Inspectorate 1011. Budapest, Fo u.44-50	Mr. Varga, Pal tel.: (1) 201-4619
Environmental Management and Law Association (EMLA)	Dr. Kiss, Csaba tel.: (1) 133-2931
Environmental Training Program 1112. Budapest, Budaorsi �t 45.	Ms. Eri, Vilma tel.: (1) 185-0777
Dep. of Environmental Technology, Godollo Agricultural University (GATE) 2100 Godollo, Pater K. u. 1	Dr. Istvan Barotfi, (28) 310-200
Hungarian Academy of Sciences, Committee on Environmental Sciences (MTA) 1051 Budapest, Roosevelt ter 9.	Dr. Janos Kovacs (1) 138-2344 ext. 310
Hungarian Association for Environmentally Aware Management (KOVET-INEM Hungaria) 1063 Budapest, Munkacsy M. u. 16.	Mr. Toth, Gergely tel.: (1) 131-6763, 131-7578
Hungarian Scientific Research Fund (OTKA) 1051 Budapest, Roosevelt ter 9.	Ms. Ildiko Deak (1) 117-2094
Independent Ecology Center 1035.Budapest, Miklos ter 1	Ms. Vasarhelyi, Judit tel.: (1) 180-3420
Measuring Technology and Informatics Research and Innovation Co. (MIKI) 1125 Bp, Fogaskereku u.4-6	Mr. Agoston Lorinc, (1) 155-3249
Miskolc University, Institute of Chemistry, Dept. of Physical Chemistry 3515 Miskolc Egyetemvaros	Dr. Ivan Raisz, (46) 366-111 ext. 1338
Public Foundation for Occupational Safety Research 1020 Budapest, Otvos J. u. 1-3.	Dr. Janos Solt, (1) 176-2922
Public Hygiene Society 2483.Gardony Pf. 15 Gardony. Bone K. u. 44.	Mr. Nagy, Gyorgy tel.: (1) 22-355-065
Regional Environmental Center for Central and Eastern Europe (REC)	Mr. Pawel Kazmierczyk tel.: (26) 311-199
Veszprem University 8201 Veszprem, Egyetem u. 10	Department of Cybernetics, dr. Tibor Chovan, (88) 422-022 ext. 276
WWF Hungary 1124. Budapest, Nemethvolgyi u. 78/b	Mr. Markus, Ferenc tel.: (1) 1754-790

International Trade Administration