Exploring Linkages between Environmental Goods and

Services

Exploring Linkages between Environmental Goods and

ServicesPresentation to the WTO Symposium on

Trade and Sustainable Development within the Framework of 51

of the Doha Ministerial Declaration

By

Ronald Steenblik, OECD Trade Directorate

Geneva, 10 October 2005

Some proposed environmental Some proposed environmental goods …goods …

Valves

Filters

Laboratory

glasswarePumps

Meters

Photos source: http://www.sxc.hu/ Photos credits: ■ Water pump: Greg Jacobsen; ■ Big valve: Cheryl Empey; ■ Gas meter: K. Fawcett; ■ Laboratory flask [“Liquid contained”]: Dain Hubley; ■ Air filter: Jaime Barber

… … and environmental servicesand environmental services

Wastewater management services

Photos source: http://www.sxc.hu/ Photos credits: ■ Wastewater management: Sherry Wil; ■ Garbage 4: Jeinny Solis S.

Solid waste management services

Environmental servicesEnvironmental services(Sanitation services)(Sanitation services)

Photos source: http://www.sxc.hu/ Photos credits: ■ Beach cleaning: Rolf Esslinger; ■ Street sweeper: Tim and Annette; ■ Snow truck: Rui R.

Street cleaning

Beach cleaning

Snowremoval

Environmental servicesEnvironmental services(Other environmental services)(Other environmental services)

Nature and landscape protection services

Noise and vibration

abatement services

Air-pollution control and monitoring

Environmental protection services not elsewhere

classified

Remediation and clean-up of soil, surface water

and groundwater

Photos source: http://www.sxc.hu/ Photos credits: ■ Power plant [Industrial 8]: Kenn Kiser; ■ Sound meter: Stephen Gibson; ■ Golf course: Gary Tamin; ■ Oil spill crew [marea negra 4]: Mariano Lesser; ■ Chemical analysis: Ulrik De Wachter.

Case studiesCase studies

• OECD engaged two consultants to find cases of exports of environmental services to private customers in developing countries.

• Asked what “environmental” goods were used in connection with those services, and from where they were procured.

• Asked were there any trade barriers?

Example: multi-service contractExample: multi-service contract

• Client: Arcelor’s Vega do Sul plant (Brazil).

• Service supplier: Veolia Environnement (France)

• Contract: wastewater management, solid-waste manage-ment, process water, electricity, natural gas, industrial gases, compressed air

• Goods: tanks, pumps, compressors, filters, valves and fittings, measurement instrumentation …

• Provenance: estimated 75% procured locally

• Import barriers: tariff exemption procedure activated, but process was “extremely long and difficult”

Example: water & wastewater treatmentExample: water & wastewater treatment

• Client: Shanghai Chemical Industrial Park (China)

• Service supplier: Sino French Water Development Co. Ltd. (France and Hong Kong)

• Contract: production of 200,000 m3/day industrial water and 7,000 m3/day of potable water; treatment of various industrial effluents

• Goods: tanks, pumps, compressors, filters, valves, monitoring instruments (manostats, pyrometers, …)

• Provenance: tanks, valves, many instruments procured locally; 20-30% of pumps and compressors imported.

• Import barriers: tariffs

Example: soil remediationExample: soil remediation

• Client: major manufacturer and retailer of cosmetics

• Service supplier: Indonesian subsidiary of Environmental Resources Management (USA)

• Contract: take over monitoring of groundwater pollution at former production facility, including installing new wells

• Goods: bladder pumps, diffusion bags containing distilled water, filters, passive sorbent collection devices, bottles

• Provenance: originally from Australia, more and more from Malaysia

• Import barriers: tariffs

Findings (1)Findings (1)

• The market for environmental services is growing, driven by:– Ever tighter regulations– CSR and other private obligations– Desire of industrial clients to stick to core

competencies– Contractual advantages of servicing

multiple clients

Findings (2)Findings (2)

• Goods associated with environmental services– Frequent need for: hardware to move air,

solids or fluids; to store fluids; and instruments

– Imports of specialty items; local procurement of heavy equipment and more common items

Findings (3)Findings (3)

• Import barriers– Information is difficult to obtain

(sensitive issue)– Experiences vary. Waivers of tariffs are

not uncommon, but administratively burdensome when used

– Trade facilitation is sometimes an issue

For more informationFor more information

• www.oecd.org/trade

• Steenblik, Ronald, Dominique Drouet and George Stubbs (2005) “Synergies between trade in environmental services and trade in environmental goods”, OECD Trade and Environment Working Paper No. 2005-01.