MOUNTAIN VIEW, Calif. -- Mexico boasts one of the largest water and wastewater treatment markets in Latin America. However, the high degree of activity is mainly the result of the increasing number of contaminated water sources, adverse effects on the ecosystem, and the scarcity of clean drinking water. Now, several institutions and governmental authorities, under pressure to increase water standards, are implementing new regulations to protect Mexico's dwindling water supplies.
According to strategic new research conducted by Frost & Sullivan (www.frost.com), Mexican Markets for Water and Wastewater Treatment, the market is expected to experience notable growth and remain solid throughout the forecast period 1998 to 2004. Revenues were estimated to be $360 million in 1997.
"Growth is expected to be stronger in the industrial wastewater treatment equipment market than in the municipal markets, which have remained lethargic primarily as a result of the stalling of large projects in reaction to funding difficulties," say Frost & Sullivan Analyst Mirna Saab. Opportunities can be found at the U.S./Mexico border, and the equipment market also offers opportunities, since the availability of equipment is crucial to this market.
The major restraint on the Mexican water and wastewater market is that declining oil prices are reducing government spending. Access to credit has also impaired market activity in the larger projects. However, several factors are expediting the market's rapid growth. For instance, the legal environment is forcing wastewater treatment, while export markets are requiring industries to incorporate ecologically sustainable processes, including water treatment of effluents, Saab says.
Governmental policies to improve outdated infrastructures that are unable to meet the increasing needs of Mexico's growing populations, are driving all sectors of the market. In addition, growth in key end-user segments such as municipalities and federal government, petrochemical, pulp and paper, sugar mills and beverages, are driving demand for wastewater treatment plants.
The Mexican market contains about 16 significant market competitors, and all large, global players are represented, in addition to several local players. Companies that can provide first rate services and the latest technological capabilities, specifically in the water and wastewater markets, are better positioned to enter the market. Players seriously considering expansion in this market must establish a physical presence through local offices, joint ventures, and associations with local competitors. For some, new opportunities can be found through acquisitions. The ability to access project financing funds, service quality, state of the art technology and industry experience are determining factors for success.
This new study, Mexican Markets for Water and Wastewater Treatment, is the first in a series of Latin American studies. This report is unique in terms of quality and depth, and it is a valuable tool to companies interested in Latin American market penetration strategies and new marketing ideas. Included in this study are revenue forecasts, market shares, technology and market trends, competitive issues, and strategies.
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