Water use and quality represent significant market opportunities for manufacturers of equipment that improve water use and reduce pollution. The need to build new and expand and upgrade existing drinking water and wastewater treatment systems worldwide means opportunities for engineers, contractors and equipment suppliers. These public works sectors generate more jobs per dollar invested than any other type of public investment. PA helps foreign governments use this market power to attract the best value suppliers. We also help equipment manufacturers lower their risks of expanding into these developing markets.
Track record
Financial barriers to investment in water and wastewater projects, Mexico
For the US Department of Commerce, PA examined the financial resources available to finance new capital investments in water and wastewater facilities and analyzed impediments to structuring viable, fee-supported systems capable of securing domestic and international capital. PA examined loans and loan guarantee mechanisms available from US, Mexican and multilateral sources and presented these findings to members of 25 Mexican municipalities and many US environmental firms.
Survey of wastewater treatment market, Mexico
For a private US firm, PA surveyed Mexico's wastewater treatment market. The work included an overview of Mexico's economic and environmental situations, government policy on water, the country's wastewater situation, the municipal and private sectors' construction of plants and projects, internationally funded projects and wastewater activities along the US-Mexico border region. PA also conducted telephone surveys of all large and medium-sized Mexican industries in several industrial sectors to provide information on opportunities in Mexico's private sector wastewater market. After identifying the best opportunities for the client, PA recommended an entry strategy for the company.
Water sector strategy and export market plans, worldwide
To help the US water industry improve its international competitiveness and increase its market share, PA prepared a strategy focused on its export performance and how to become more effective and competitive in pursuing international opportunities. The strategy included discussions of the structure and key players in the water and wastewater industry, global industry trends, the main US firms in these markets and their competitors, strategies to help US companies become more competitive and recommendations to improve the competitive position of US industries.
As part of this assignment, we also profiled market opportunities in the water and wastewater sectors, with a particular focus on the emerging markets the Department of Commerce's identifies as most significant: Argentina, Chile, China, Czech Republic, India, Indonesia, Korea, Malaysia, Mexico, Poland, Taiwan, Thailand and Turkey. For each country PA analyzed market size, US market share, institutional structure and capacity of principal water authorities, regulatory and enforcement trends and other drivers, business issues affecting the sectors and exporters, market/project opportunities and best prospects for US exports. Each review also identified appropriate technology solutions that are well accepted or suited to the specific markets.
Due diligence in water trading, United States
PA was retained by a US investment bank to advise on the water trading services market in California and Texas, as proposed in the business plan of a start-up company. PA completed a thorough evaluation of economic, financial, regulatory, and institutional strengths, weaknesses, opportunities and barriers to this proposed business. The results focused on these six factors that would be key to development of the market for water in these states: standardization, price transparency, fungible nature of the commodity, price volatility, arbitrage opportunity and trading characteristics.
Strengthening financial management, Thailand
PA assisted Thailand's Provincial Waterworks Authority in improving its financial management through improving skills in water tariff design and ratemaking, cash flow and financial management and water demand estimation. Our services included:
Tariff planning
PA compared the existing tariff and costs of supply in different locations, efficacy in demand reduction and affordability and willingness to pay. PA also reviewed and revised tariff planning, demand forecasting and financial projection models, evaluated the price elasticity of demand, prepared training modules and presented on-the-job training
Financial management and accounting
PA identified improvements to accounting systems to support decentralization. These included the preparation of regional and waterworks budgets and financial statements, modifying them to incorporate activity-based accounting, designing improvements to internal audit procedures and developing training modules in the new system
Cash flow management
PA reviewed cash flow and necessary cash reserves, identified an optimal borrowing plan, prepared analytical models and a handbook on cash flow planning and trained the authority's staff.
