International Trade in Services.pdf - DSpace at Khazar University

328 International Trade in Services
summary paper indicates that almost every country asserts that export capacity and
overseas sales have been increasing and will continue to do so. Interestingly, among
the study countries, only the Czech Republic report highlights the substantial barriers
that exporters have faced and the problems associated with the lack of capital and
the inaccessibility of export credits, suggesting that exports of environmental goods
and services may only be a problem for developing countries in a more advanced
stage of development.
According to UNCTAD, the largest environmental firms are still concentrated
in developed countries. However, a recent UNCTAD study shows that the participation
of developing countries in infrastructure and noninfrastructure environmental
services is increasing. This is the case of a number of Asian and Latin
American companies that have acquired technological and service capacities,
partly through joint ventures in the environmental sector in their home countries
(UNCTAD 2003).
Box 10.4 documents several cases of environmental service transactions
involving firms in developing countries. The determinants and underlying factors
in this trade are highlighted.
Box 10.4: The Participation of Developing Countries in Environmental Services
Economic growth in Asia has boosted the trade in environmental services. Industrial
waste management service revenues in Malaysia, the Philippines, and Singapore
amounted to US$255 million in 2006 and are expected to grow to US$378 million in
2013 (Asia Pulse 2007). This growth is attributed to rising populations and industrial
growth (Asia Pulse 2007).
Financial conditions in the home market can help environmental service firms succeed
in exporting. For example, a Colombian utility that provides water and sanitation
services is planning to expand into rural markets in Bolivia, Ecuador, Honduras,
Nicaragua, and Peru. The utility plans to use direct investment and acquisition as part
of its international strategy. The utility’s comfortable financial position at home will
enable it to expand abroad (Business News Americas 2008b).
Firms in developing countries engage in trade across a variety of environmental
service segments. The South African firm EnviroServ has experienced a significant
increase in revenue in recent years from its operations in domestic waste collection
services in Angola, Mozambique, and Namibia (Mokopanele 2008).
In developing countries, the enforcement of environmental rules is pushing firms
to become more sophisticated. South African regulations that require the reduction
of waste generation and disposal have catalyzed EnviroServ to expand its services
higher up the waste hierarchy (EnviroServ 2003). As a consequence, EnviroServ offers
services to promote waste avoidance, minimization, reuse, recycling, treatment, and
disposal in all its markets (EnviroServ 2003).
Firms in developing countries are anticipating growth in export markets of
interest because of the adoption of more stringent regulations in many countries.
Thus, the Chilean firm Manantial already offers domestic and industrial wastewater
treatment services in Argentina and Peru and is contemplating expansion into Cuba
and Ecuador. Determining factors are the legal framework in export markets, as well
as familiarity with market conditions (Business News Americas 2008c).