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Environmental Technology Exports: The Time is Now On July 25th, the International Monetary Fund (IMF) published an updated outlook on the world economy projecting continued global growth at 5.2% in 2007 and 2008, which is 0.3 percentage points higher than their estimates from April. This report identified the emerging markets as leading this trend, with China’s economy out front with a growth rate of 11.5% in the first half of 2007. The IMF also published a separate article in April on the economies in Latin America, which it declares are in the middle of their strongest expansion since the 1970’s. Declining inflation rates were a trend across the region as the average rate of inflation dropped to 5% for 2006. While continued global growth is encouraging, it is a more complex story in the emerging market countries. This growth – often at much higher rates compared to mature markets – can rapidly transform these economies and societies. Many of the people in these markets benefit from greater job opportunities, improved standards of living, and an enhanced ability to provide better lives for their children. At the same time, these people and their governments are challenged to respond to these dynamic changes, which include government services and national infrastructures which quickly become overburdened and are unable keep pace with the economy. Environmental problems are a characteristic of all emerging markets with high economic growth rates. In some cases, these problems are the direct result of demographic changes resulting from economic development – such as when municipal populations grow dramatically as people relocate for jobs. The water, waste, and environmental management services in these cities are unable to cope with the rapid increase in population. Environmental problems also emerge when governments choose not to enforce standards in order to avoid any risk of inhibiting economic growth. In many emerging markets, perceptions of environmental issues are changing with several factors in play. One factor driving this change is that as populations become wealthier, they have greater expectations about their standard of living and subsequently increase demands on their governments to deliver on these higher standards. Rising energy costs is another factor. Increased energy costs provide a financial incentive for governments, companies, and consumers to invest in energy-efficient materials and technology. These trends all represent significant sales opportunities for Virginia exporters of environmental technology and services. Exports of environmental technology are already robust. The Department of Commerce reports that U.S. environmental technology exports to the top 20 overseas markets totaled $30.4 billion in 2006. These exports have grown by over 50% since 2002. Almost half of these top-20 countries can be considered as emerging markets, including China, India, Brazil, Mexico, and Thailand. Mexico is the second largest market for these exports – trailing only Canada and ahead of Japan and Germany. Environmental technology exports to Mexico were valued at $4.5 billion in 2006 and have grown 26% during the past four years. Brazil is one of the fastest growing markets for American companies with environmental technology exports increasing 24% from 2005 to 2006 and an impressive 52% from 2002 to the end of 2006. Recognizing that significant sales opportunities exist in these markets right now, the Division of International Trade at the VEDP is organizing a “Green Trade Mission” for November 12 – 16, 2007, which will travel to Brazil, Panama, and Mexico. The Division of International Trade will be arranging meetings for Virginia exporters with pre-qualified local companies in these markets, who are potential distributors, sales partners, or endusers. Participation is open to Virginia exporters of environmental technology and services. Participants must register before September 3rd. Contact Mark Myrick at 804-545-5755 or MMyrick@YesVirginia.org for more information.