Assessing Latin American Markets for North American Environmental Goods and Services
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Assessing Latin American Markets for North American Environmental Goods and Services Prepared for: Commission for Environmental Cooperation Prepared by: ESSA Technologies Ltd., The GLOBE Foundation of Canada, SAIC de México S.A. de C.V., CG/LA Infrastructure July 1996 1 Retail Price: $20.00 US Diskettes: $15.00 US For more information, contact: Secretariat of the Commission for Environmental Cooperation 393 St.-Jacques, Suite 200 Montreal, Quebec, Canada H2Y 1N9 Tel: (514) 350-4308 Fax: (514) 350-4314 Internet http://www.cec.org E-mail: [email protected] This publication was prepared for the Secretariat of the Commission for Environmental Cooperation (CEC) as a background paper. The views contained herein do not necessarily reflect the views of the CEC, or the governments of Canada, Mexico or the United States of America. ISBN 0-921894-37-6 © Commission for Environmental Cooperation, 1996 Published by Prospectus Inc. Printed in Canada To order additional copies of the report, please contact the publishers in Canada: Prospectus Inc. Barrister House 180 Elgin Street, Suite 900 Ottawa, Ontario, Canada K2P 2K3 Tel: (613) 231-2727 1-800-575-1146 Fax: (613) 237-7666 E-mail: [email protected] or the distributor in Mexico: INFOMEX Nuevo León No. 230-203 Col. Hipodromo Condesa 06140 México D.F. México Tel: (525) 264-0521 Fax: (525) 264-1355 E-mail: [email protected] Disponible en français. Disponible en español. 2 Commission for Environmental Cooperation Three nations working together to protect the Environment. A North American approach to environmental concerns. The Commission for Environmental Cooperation (CEC) was established by Canada, Mexico and the United States in 1994 to address transboundary environmental concerns in North America. While the idea to create such a commission originated during the negotiations of the North American Free Trade Agreement (NAFTA), it derives its formal mandate from the North American Agreement for Environmental Cooperation (NAAEC). The NAAEC builds upon and complements the environmental provisions established in the NAFTA. It creates a North American framework whereby goals related to trade and the environment can be pursued in an open and cooperative way. In broad terms, the NAAEC sets out to protect, conserve and improve the environment for present and future generations. How? The parties to the Agreement set out the following objectives: · to protect the environment through increased cooperation; · to promote sustainable development based on mutually supportive environmental and economic policies; · to support the environmental goals of NAFTA and avoid creating trade distortions or new trade barriers; · to strengthen cooperation on the development of environmental laws and enhance their enforcement; and · to promote transparency and public participation. In signing the NAAEC, the governments of Canada, Mexico and the United States committed themselves to a core set of actions, including: · reporting on the state of the environment; · striving for improvement of environmental laws and regulations; · effective enforcement of environmental law; and · publication and promotion of information. 3 Mission Statement The CEC facilitates cooperation and public participation to foster conservation, protection and enhancement of the North American environment for the benefit of present and future generations, in the context of increasing economic, trade and social links between Canada, Mexico and the United States. 4 Introduction and Acknowledgements Competitiveness and market access in the twenty-first century are irrevocably tied to the use of, and export of, modern, efficient and clean technologies. Indeed, trade presents enormous opportunities and potential for the promotion and development of new clean technologies and creates opportunities for investment and innovation. In North America, the opportunities for investment in environmental technology have been tremendous. Above all, the inclusion of Mexico in the North American market will provide lessons that will be of interest to Latin America. Trade liberalisation and NAFTA has enabled Canadian, Mexican, and US environmental service and technology providers to develop, partner and conduct their collective environmental problem-solving and expertise both together as a new community and beyond North America’s borders. The Commission for Environmental Cooperation’s (CEC) report,Assessing Latin American Markets for North American Environmental Goods and Servicesfeatures such critical information as what makes multinational or North American partnerships successful, where markets are expanding, and where Mexico has been successful in developing clean technologies and adapting proven technologies from the US and Canada for use in its domestic market. The report also highlights how these, and other technologies might expand into new markets with similar needs. The principal authors of this report are Sarah England of ESSA Technologies Ltd., Richard Kiy, of SAIC de México S.A. de C.V., John Bildner of CG/LA Infrastructure and Johnathan Rhone of the GLOBE Foundation. The CEC would like to acknowledge the tremendous effort made by these individuals and their respective organizations in compiling this report. Sarah Richardson Program Manager, NAFTA/Environment July, 1996 5 Table of Contents Acronyms............................................................................................................................................... 6 Preface................................................................................................................................................. 10 Target Market..............................................................................................................................................10 Environmental Regulatory Reform and Regional Trade Agreements............................................................11 Market Overview and Analysis of Target Subsectors....................................................................................11 American, Canadian and Mexican Export Strengths....................................................................................11 Market Access Strategies.............................................................................................................................12 Financing ....................................................................................................................................................12 1.0 Introduction................................................................................................................................... 13 1.1 Why Latin America?.................................................................................................................... 13 1.2 Why These Target Markets?........................................................................................................ 14 1.3 Economic & Political Climate in Latin America............................................................................. 14 Country and Political Risk...........................................................................................................................16 1.4 Environmental Issues Facing the Region..................................................................................... 17 Top five environmental priorities.................................................................................................................17 1.5 Methodology................................................................................................................................ 19 1.6 The Opportunities........................................................................................................................ 20 2.0 Environmental Regulations and Regional Trade Agreements.................................................... 21 2.1 Introduction.................................................................................................................................. 21 2.2 Argentina’s Environmental Legislation.......................................................................................... 21 2.3 Brazil’s Environmental Legislation................................................................................................ 23 2.4 Chile’s Environmental Legislation................................................................................................. 25 2.5 Colombia’s Environmental Legislation.......................................................................................... 26 2.6 Venezuela’s Environmental Legislation........................................................................................ 28 3.0 Opportunities................................................................................................................................. 30 3.1 Introduction.................................................................................................................................. 30 3.2 Argentina..................................................................................................................................... 30 What is the Opportunity?.............................................................................................................................31 Enforcement of Environmental Regulations.................................................................................................32 Key Environmental Subsectors.....................................................................................................................32