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Environmental >> Colombia

Environmental Global Market
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Colombia Market


Overview: Pollution Control Equipment. The country’s estimated coverage of potable water infrastructure reached 97.4% of the urban population providing 90.2% of the population with access to sewer system. In the country’s rural areas the situation is different. Aqueduct service coverage reaches 66%, and sewer system access reaches only 57.9% of the inhabitants.

Colombia’s Water Regulatory Agency (CRA) estimates that nearly 45% of the treated water (by the country’s 1,800 water utilities) goes unaccounted for. Water is available, produced, but not paid for by the users, or is lost because of inadequate piping systems. This system creates a large problem for utilities and users and negatively affects potential future investments. Government sources estimate that the country needs to make environmental investments in the range of $3.3-$3.4 billion per year to maintain an adequate level of protection against all sources of pollution.

The Ministry of Environment, Housing, and Territorial Development (MMA) assumes that close to 80% of Colombia’s municipal entities dispose of untreated wastewater into rivers or lakes. Colombia is a regional leader in the development and implementation of a wastewater pollution “tax” (tasa retributiva). However, only a few environmental agencies have established regional funds to finance wastewater treatment facilities. Cities such as Bogotá and Medellín own wastewater treatment plants, and other cities such as Cartagena are developing an underwater outfall system with World Bank funding or are developing plans for other treatment systems. Nevertheless, funding remains a central concern. Medellín is developing plans for a new wastewater treatment plant that could cost approximately $300 million.

Given the large negative health impacts for the country’s inhabitants that are estimated to reach up to 3.7% of the country’s gross domestic product, the government has enacted stricter regulations setting limits for air pollution emission levels for mobile and fixed emission sources. However, much remains to be done in terms of improved environmental regulations, policy, environmental regulations enforcement, and capacity building for the different environmental agencies. Key focus areas include integrated water resource management and air monitoring systems, wastewater treatment and sewerage systems, underground water supply, and toxic and hazardous wastes collection and disposal.

A major obstacle to this sector’s growth is the current fiscal deficit that affects the availability of resources from the government budget and insufficient investments from private entities. Most public sector funds are expected to come from transfers from the electric power sector, and the collection of royalties, taxes, and other contributions from so-called “green markets”. New financing arrangements to stimulate private sector investment in this sector include new credit and tax incentives, such as sales and income tax exemptions for the use of environmentally sound technologies, new economic instruments and pollution charges, carbon dioxide sequestration options, and other stock market alternatives.
 
Under the US - CTPA, 79% of U.S. environmental goods and equipment would receive duty-free treatment immediately. The remaining equipment tariffs will be eliminated in a period of between five to 11 years. In addition, Colombia will eliminate its prohibition on the importation of remanufactured environmental goods and equipment upon entry into force of the Agreement. Additionally, the US -CTPA would eliminate tariffs on most remanufactured construction equipment immediately and will phase out tariffs on a small number of remanufactured goods over ten years.

Best Products/Services: Water and wastewater treatment plants; Water pollution monitoring and control equipment; Pumps and valves; Solid waste hauling and disposal equipment; Air pollution monitoring and control equipment; Environmental services (consulting); and The operation and management of municipal services such as providing potable water and collection and hauling and disposal of solid waste.

Opportunities: CRA is developing new regulatory methodologies to incorporate the cost of “unaccounted for” water, and the cost of sewage collection into end-user fees to allow for the financing of large infrastructure projects needed throughout the country. In addition, the MMA is working on the incorporation of pollution charges to fund the cost of wastewater treatment plants. There are several projects with partial multi-lateral banks funding, including the Bello wastewater treatment plant ($336 million), in Medellín that could be completed by 2010. Regulations regarding air pollution and solid and hazardous wastes are being developed at a time when public financing is almost non-existent, and enforcement has traditionally been lacking. These conditions are expected to change if the proposed US - CTPA is ratified by the U.S. Congress and implemented. Industry sources believe that the agreement would encourage the government and private sectors to improve environmental compliance with the country’s regulations, which could result in increase investment in pollution prevention and control equipment. These changes will be necessary in order to comply with the agreement’s environmental provisions.
 




  2012 3rd International Conference on Environmental Science and Development (ICESD 2012)