U.S. International Trade Commission

Robert A. Rogowsky

Director of Operations and Acting Director of Industries

COMMISSIONERS

Address all communications to

Secretary to the Commission

United States International Trade Commission

Washington, DC 20436

Jennifer A. Hillman, Vice Chairman

Deanna Tanner Okun, Chairman

Marcia E. Miller

Stephen Koplan

Charlotte R. Lane

Daniel R. Pearson

This report was prepared by the Office of Industries

Jennifer Baumert, Project Leader

jennifer.baumert@usitc.gov

Michael Ferrantino, Economist

Staff assigned:

William Chadwick, Lisa Ferens, Tom Jennings,

Dennis Luther, and Linda White

With special assistance from:

Lynette Gabourel and Cynthia Payne

Under the direction of:

Richard W. Brown

Division Chief
U.S. International Trade Commission

Washington, DC 20436

April 2004

www.usitc.gov

Publication 3679

Solid and Hazardous Waste Services:

An Examination of U.S.

and Foreign Markets

Investigation No. 332-455

i

ABSTRACT

The environmental services sector, including the solid and hazardous waste services

industry, is the focus of increasing international attention. The sector has received

special emphasis in the World Trade Organization (WTO), as the reduction or

elimination of barriers affecting trade in such services has been identified in the Doha

Ministerial Declaration as one of the principal goals of the present negotiating round. 

Moreover, environmental issues have become increasingly tied to international trade

and investment, such that the environmental impact of trade agreements is more

likely to be evaluated and considered as a critical component of the policy under

consideration.

This report provides an overview of U.S. and foreign markets for solid and hazardous

waste services; examines trade and investment in solid and hazardous waste services

markets, including barriers affecting such trade and investment; and discusses

existing regulatory practices. With regard to the geographic coverage of this report,

information is presented on both developed- and developing-country markets.

The global market for solid and hazardous waste services is dominated by developed

countries, with the United States, Western Europe, and Japan ranking as the world’s

largest markets for such services. In most developed countries, the solid and

hazardous waste services sector is considered a mature and competitive industry,

while solid and hazardous waste services markets in many developing countries are

small, but rapidly growing. Among the countries discussed in this report, highincome economies typically generate more solid waste than the middle-income

economies. In addition, high-income countries manage a greater share of their waste,

are more likely to employ modern waste management techniques, and are more likely

than developing economies to maintain and enforce strict waste management

regulations, as developing economies may lack the economic and political capacity to

finance extensive waste management programs or maintain strict regulations.

The extent of cross-border trade and investment in solid and hazardous waste

management services differs dramatically among the countries examined in this

study, but is greatest among high-income countries where stringent regulation and

consistent enforcement create steady demand for waste management services and

encourage the development of waste management capacity. Few of the countries

selected for discussion in this report have explicit restrictions on trade in solid and

hazardous waste management services. However, regulations and practices that

pertain to all sectors, or to related sectors such as architecture and engineering, can

potentially affect trade in the waste management industry. 

 1

 See appendix A.

 2

 See appendix B. For summaries of the public submissions received in response to this

investigation, see appendix D.

iii

PREFACE

On July 1, 2003, the U.S. International Trade Commission (Commission) received a

letter from the United States Trade Representative (USTR) requesting that the

Commission conduct two investigations under section 332(g) of the Tariff Act of

1930 on discrete segments of the environmental services industry.1

 The USTR

requested that the first of these reports focus on solid and hazardous waste services. 

In response to the request, the Commission instituted investigation 332-455 on July

29, 2003.

The USTR requested that the Commission’s report include:

• an overview of foreign and domestic markets for solid and hazardous waste

services;

• an examination of trade and investment in solid and hazardous waste services

markets, including barriers affecting such trade and investment, if any; and 

• a discussion of existing regulatory practices.

The USTR requested that, for the purposes of this investigation, the Commission

define the solid and hazardous waste industry to include the collection of solid and

hazardous waste from households and industry; the treatment and disposal of solid

and hazardous waste by various means; the collection, separation, and sorting of

recyclable materials; waste compacting; waste reduction services; and incidental

services. The USTR also requested that the Commission include information on both

developed- and developing-country markets.

Copies of the notice of investigation were posted at the Office of the Secretary, U.S.

International Trade Commission, Washington, DC, 20436, and the notice was

published in the Federal Register (68 F.R. 46223) on August 5, 2003.2

 Nothing in

this report should be construed to indicate the Commission’s finding in an

investigation conducted under other statutory authority covering the same or similar

subject matter.

v

Executive Summary

Introduction

On July 1, 2003, the U.S. International Trade Commission (Commission) received a

letter from the United Stated Trade Representative (USTR) requesting that the

Commission conduct two investigations under section 332(g) of the Tariff Act of

1930 on discrete segments of the environmental services industry, with the first of

these reports focusing on solid and hazardous waste services (appendix A). The

environmental services sector has received special emphasis in the World Trade

Organization (WTO), as the reduction or elimination of barriers affecting trade in

such services has been identified in the Doha Ministerial Declaration as one of the

principal goals of the present negotiating round. The USTR indicated that

information on environmental services markets would be useful in conducting WTO

negotiations on environmental services, the environmental review of this element of

the current WTO negotiations, and future negotiations and reviews.

The Solid and Hazardous Waste Services Market

In 2001, the year for which the most recent global data are available, solid waste

management services and hazardous waste management services respectively

accounted for 43 percent and 6 percent of the $279 billion worldwide environmental

services market. The United States is the world’s largest market for solid and

hazardous waste services, while other key markets for such services include Western

Europe and Japan. In 2001, the world’s largest solid and/or hazardous waste services

firms included Onyx (a subsidiary of French firm Veolia Environment, solid and

hazardous waste services), Sita (a subsidiary of French firm Suez, solid waste

services), Waste Management (United States, solid waste services), Allied Waste

(United States, solid waste services), and RWE Entsorgung (Germany, solid waste

services).

Relevant literature indicates that differences in technology (between methods of

disposal, between countries, and over time) influence the conditions of supply in the

industry. Changes in the amount of waste generated and in the state of regulation

influence the conditions of demand. These fundamental determinants of supply and

demand, in conjunction with other forces such as economic growth and the relative

prices of energy and recyclable materials, influence the market structure of the

industry.

There seems to be a significant relationship between economic welfare and the

character of national solid and hazardous waste services markets. In most developed

countries, the environmental services sector as a whole, and the solid and hazardous

waste services segments in particular, are considered mature industries characterized

by reduced profitability and excess capacity, which are driving consolidation. 

Further, high-income countries manage a greater share of their waste, are more likely

to employ modern waste management techniques, and are more likely to maintain

and enforce strict waste management regulations than developing economies. By
 1

 Among the economies discussed in this report, Australia, Canada, China, the Czech

Republic, the European Union, Japan, South Africa, and the United States scheduled GATS

commitments on refuse disposal services. Chile, Egypt, Malaysia, and Mexico did not

schedule GATS commitments on such services.

vi

contrast, solid and hazardous waste services markets in many developing countries

are small, but are experiencing rapid growth. Many developing countries have

expressed significant interest in environmental issues, going so far as to pass strict

environmental legislation, but they sometimes lack the resources to enforce their

environmental policies. Private sector participation in the solid waste industry also

seems to be related to per capita income levels. Solid waste management industries

in high-income countries tend to be dominated by private firms, while in many

middle-income countries, waste removal is still considered a public-service that state

and local governments undertake themselves. 

Certain other market characteristics, particularly in the hazardous waste segment,

seem to be unrelated to income. Although high-income economies typically generate

more solid waste than middle-income economies, hazardous waste generation in a

given country does not seem to be closely related to a country’s level of

development. Additionally, the hazardous waste management industry is dominated

by the private sector in almost all of the sample countries in this investigation,

regardless of income level. 

Trade and Investment

The extent of cross-border trade and investment in solid and hazardous waste

management services differs dramatically among the economies examined in this

study. Such activity tends to be most common among high-income countries where

stringent regulation and consistent enforcement create steady demand for waste

management services and encourage the development of waste management capacity. 

Affiliate sales associated with direct investment in the waste management services

industries are likely one or two orders of magnitude larger than cross-border trade of

such services.

Approximately 30 percent of WTO member states– and eight of the twelve

economies1

 discussed in this report– made commitments on refuse disposal services

under the General Agreement on Trade in Services (GATS) (appendix C). 

Restrictions specific to trade in refuse disposal services are limited. However, broad

measures that apply to purchases or rentals of property, equity holdings, residency

requirements for directors, tax and subsidy measures, and visa provisions such as

quotas and length of stay may have an impact on the foreign provision of solid and

hazardous waste management services, as may measures specific to related sectors

such as architecture and construction.
vii

Table of Contents

Page

Abstract .................................................................. i

Preface . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . iii

Executive Summary .................................................. v

Chapter 1. Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-1

The scope of the solid and hazardous waste services industry . . . . . . . . . . . . . . . . . . . . . . . . . 1-2

The global market for solid and hazardous waste services . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-4

Approach . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-6

Chapter 2. Solid and hazardous waste services: Industry

overview and literature review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-1

Activities and technology . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-2

Solid waste . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-2

Sources of solid waste . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-2

Collection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-3

Methods of disposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-5

Landfilling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-5

Incineration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-6

Recycling . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-7

Illegal disposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-8

Hazardous waste . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-9

Methods of disposal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-10

Siting . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-10

Waste generation and demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-11

Industry structure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

Size and scale of firms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

Organization of firms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

International transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-14

U.S. data on international transactions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-15
viii

Table of Contents–Continued

Page

Chapter 3. United States . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-1

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-1

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-10

Future prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-14

Chapter 4. Canada and Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-1

Regional market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-1

Canada . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-2

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-2

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-6

Mexico . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-8

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-8

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-14

Future prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-16

Chapter 5. Europe . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-1

Regional market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-2

European Union . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-3

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-3

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-8

Czech Republic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-9

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-9

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-12

Future prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-12
ix

Table of Contents–Continued

Page

Chapter 6. Asia and the Pacific . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-1

Regional market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-1

Australia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-4

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-4

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-6

China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-6

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-6

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-9

Japan . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-9

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-9

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-12

Malaysia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-13

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-13

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-16

Future prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6-17

Chapter 7. Other developing-country markets . . . . . . . . . . . . . . 7-1

Introduction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-1

Regional market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-1

Chile . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-2

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-2

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-7

Egypt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-7

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-7

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-11

South Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-12

Market overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-12

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-15

Future prospects . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7-16

Chapter 8. Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-1

Market conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-1

Solid waste management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-1

Hazardous waste management . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-7

Trade and investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-11
x

Table of Contents–Continued

Page

Appendices

A. Request letter . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . A-1

B. Federal Register notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

C. Choice of disposal method: A comparison of country- and U.S. State-specific data . . . . . . . . C-1

D. Solid and hazardous waste services in the General Agreement on Trade in Services . . . . . . . D-1

E. Position of interested parties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . E-1

F. Glossary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . F-1

Figures

1-1. Solid and hazardous waste management: Global market, 2000 . . . . . . . . . . . . . . . . . . . . . . . . 1-5

8-1. GDP and municipal solid waste per capita, by country, 2000 . . . . . . . . . . . . . . . . . . . . . . . . . 8-6

8-2. GDP per capita and industry perceptions of toxic waste regulations, by country, 2002 . . . . . 8-12

C-1. Share of MSW landfilled and population density, most recent year . . . . . . . . . . . . . . . . . . . . C-6

C-2. Share of MSW incinerated and population density, most recent year . . . . . . . . . . . . . . . . . . . C-7

C-3. Share of MSW recycled and population density, most recent year . . . . . . . . . . . . . . . . . . . . . C-8

C-4. Tipping fees and population density in U.S. states, 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-9

C-5. Tipping fees and landfill use in U.S. states, 2000 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-10

Tables

2-1. Selected indicators of U.S. international transactions in waste and waste services, 2001-2002 and

Jan.-Sept. 2003 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-15

2-2. U.S. merchandise trade under HS 3825, Jan. 2002 - Sept. 2003 . . . . . . . . . . . . . . . . . . . . . . . . 2-17

2-3. U.S. merchandise trade under HS 3825, Jan. 2002 - Sept. 2003, by subcategory . . . . . . . . . . . 2-18

3-1. Selected characteristics of the U.S. solid and hazardous waste services market . . . . . . . . . . . . 3-2

4-1. Selected characteristics of the Canadian solid and hazardous waste services market . . . . . . . . 4-4

4-2. Selected characteristics of the Mexican solid and hazardous waste services market . . . . . . . . 4-9

5-1. Selected characteristics of the European Union (EU) market for solid and hazardous 

waste services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-4

5-2. Selected characteristics of the Czech Republic market for solid and hazardous 

waste services . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-10

6-1. Selected characteristics of the Australian market for solid and hazardous waste services . . . . 6-5

6-2. Selected characteristics of the Chinese market for solid and hazardous waste services . . . . . . 6-7

6-3. Selected characteristics of the Japanese solid and hazardous waste services . . . . . . . . . . . . . . 6-10

6-4. Selected characteristics of the Malaysian market for solid and hazardous waste services . . . . 6-14

7-1. Selected characteristics of the Chilean solid and hazardous waste services market . . . . . . . . . 7-3

7-2. Selected characteristics of the Egyptian solid and hazardous waste services market . . . . . . . . 7-8

7-3. Selected characteristics of the South African solid and hazardous waste services market . . . . 7-13

8-1. Characteristics of selected solid waste markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-2

8-2. Characteristics of selected hazardous waste markets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-8

8-3. Extent of solid and hazardous waste services trade by certain countries, and measures 

affecting such trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8-13

C-1. Disposal of municipal waste, selected countries, year of most recent data . . . . . . . . . . . . . . . C-4

D-1. Nature of GATS commitments on refuse disposal services . . . . . . . . . . . . . . . . . . . . . . . D-5

D-2. Publically available offers submitted by WTO members on refuse disposal services . . . D-12
OMB No.: 3117--0188

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Solid and Hazardous Waste Services:

An Examination of U.S. and Foreign Markets
 1

 Pollution often traverses national borders (transboundary migration), prompting the need

for multinational action and cooperation.

 2

 World Trade Organization (WTO), Ministerial Declaration: Adopted on 14 November

2001, WT/MIN(01)/DEC/1, Nov. 20, 2001.

 3

 Executive Order 13141, Environmental Review of Trade Agreements, 64 F.R. 63169,

Nov. 18, 1999.

 4

 For example, the U.S. Trade Representative recently announced that the United States

would seek additional input from the public on the anticipated environmental effects of a

multilateral trade agreement under the Doha Development Agenda. USTR, Zoellick

Announces United States Will Seek Additional Public Input on Environmental Trade Effects,

press release, Sept. 9, 2003.

1-1

CHAPTER 1

INTRODUCTION

Environmental services, including solid and hazardous waste management services,

are increasingly important both locally and internationally. With the generation of

waste on the rise, communities view proper collection, treatment, and disposal as

ever more critical. Demand for solid and hazardous waste services is growing as a

result of several factors, including the rapid increase in waste generation resulting

from urbanization and population growth; growing awareness of environmental

issues; the development and enforcement of environmental legislation; and

technological and economic development. Additionally, the transboundary nature of

certain environmental issues1

 has encouraged international environmental

cooperation, which has likely precipitated increased demand for related services.

The solid and hazardous waste services industry, together with the entire

environmental services sector, has received special emphasis in the World Trade

Organization (WTO), as the reduction or elimination of barriers affecting trade in

environmental services has been identified in the Doha Ministerial Declaration2

 as

one of the principal goals of the present negotiating round. It is believed that as trade

in such services grows, exporters, importers, and the environment itself may benefit

from increased competition that generally reduces costs, increases service quality,

improves efficiency, and/or introduces services that were previously unavailable. 

Environmental issues also have become increasingly tied to international trade and

investment, such that the environmental impact of a trade agreement is more likely to

be evaluated and considered as a critical component of the agreement under

consideration. For instance, the United States is required by Executive Order3

 to

perform environmental reviews (ERs) of certain major trade agreements. The

environmental review process involves environmental groups and the public in the

development of trade agreements,4

 informs trade negotiators of the possible

environmental implications of such agreements, and identifies opportunities for

environmental cooperation between the United States and its trading partners.

This report provides an overview of U.S. and foreign markets for solid and hazardous

waste services; examines trade and investment in solid and hazardous waste services

markets, including barriers affecting such trade and investment, if any; and where
 5

 Such regulatory practices may include national and subnational environmental

regulations, as well as multinational conventions or agreements on environmental issues that

may have an effect on this market. 

 6

 For more information regarding the parameters of this report, see appendices A and B.

 7

 The study includes the transportation of waste, insofar as waste is transported during the

collection process and between various transfer, treatment, and disposal facilities.

 8

 U.S. Environmental Protection Agency (EPA), Hazardous Waste Overview - Definitions,

Identification and Regulations, found at Internet address

http://www.epa.gov.fedsite/hazwaste/definition.html, retrieved Oct. 23, 2003.

 9

 WTO, MTN.GNS/W/120, July 10, 1991.

 10 United Nations Statistical Division, 1991.

1-2

possible, discusses existing regulatory practices.5

 With regard to the geographic

coverage of this report, information is presented on both developed- and

developing-country markets.6

The Scope of the Solid and Hazardous Waste Services

Industry

For the purpose of this study, solid and hazardous waste services are defined to

include the collection of solid and hazardous waste from households and industry;7

the treatment and disposal of solid and hazardous waste by various means; the

collection, separation, and sorting of recyclable materials; waste compacting; waste

reduction services; and incidental services such as testing and monitoring services

related to waste disposal. Solid waste typically is defined as nonhazardous waste

material generated by households, institutions, commercial establishments, and

industries which is discharged from their premises for collection. Solid waste also

includes non-hazardous agricultural wastes, mining and quarrying wastes (material

that is extracted in the process of mining), and energy production wastes such as fly

ash from power plant furnaces. Hazardous waste is defined by the United States

Environmental Protection Agency as waste that is toxic, flammable, corrosive,

radioactive, explosive, or otherwise dangerous.8

 Such waste may include motor oil,

diesel fuel, gasoline, paint, solvents, batteries, pesticides, infectious or otherwise

dangerous medical wastes from hospitals and clinics, asbestos materials, radioactive

wastes, and other substances. In general, information regarding the management of

high-level nuclear waste (the cleanup of nuclear wastes related to nuclear power

generation, or the production or disposal of nuclear weapons) was not collected for

this report. However, industry data on hazardous waste services such as that

published by Environmental Business International, Inc. (EBI) may reflect, inter alia,

high-level nuclear waste management activities. Hazardous waste generally

originates from the same sources as solid waste, although the collection,

transportation, and disposal methods differ. Methods used to manage the waste

stream include landfilling, incineration, composting, dumping and incineration at sea,

waste recycling, and waste minimization.

The environmental services division of the World Trade Organization (WTO)’s

Services Sectorial Classification List9

 (also known as the W/120) is divided into four

subgroups, identified by corresponding Central Product Classification10 (CPC) codes:

sewage services, CPC 9401; refuse disposal services, CPC 9402; sanitation and
 11 The OECD and the Statistical Office of the European Communities (Eurostat) have

developed a system that classifies industrial activities under three broad headings: pollution

management, cleaner technologies and products, and resource management. The United

States, the EU, Canada, and Japan reportedly consider this system to be more applicable to the

current state of affairs in the industry than the W/120. OECD/Eurostat, Environmental Goods

and Services Industry Manual for the Collection and Analysis of Data, 1999.

 12 Wholesale trade services of waste and scrap are excluded.

 13 Quantitative analysis of the solid and hazardous waste services industries is difficult as

no comprehensive international statistical definitions exist, classification criteria are

considered inadequate, and definitions often differ from country to country.

 14 The terms and conditions under which WTO signatories accord market access and

national treatment to foreign firms is provided within national schedules of specific

commitments. A commitment also discourages signatories from imposing new measures that

would restrict entry into the market or the operation of the service. In most schedules,

commitments are split into two sections: the “horizontal” commitments that apply to all of the

sectors included in the schedule, and industry-specific commitments that apply to trade in

services in a particular sector or subsector.

 15 Members report that the fundamental issue is that the environmental services industry

has evolved in recent years. When crafted, the W/120 adequately addressed the

environmental services industry. However, the classification system is now viewed by some

to be outdated and incomplete. Identified shortcomings of the W/120, as it applies to

environmental services, include its lack of emphasis on pollution prevention, sustainable

resource management, facilities development, or services provided directly to industry.

 16 For more information, see appendix C.

1-3

similar services, CPC 9403; and other environmental services.11 Solid and hazardous

waste services are captured in the refuse disposal services category, which includes

collection, treatment, and disposal services,12 incidental transportation services, and

waste reduction services.13 The W/120 is important to the General Agreement on

Trade in Services (GATS), as most Member countries use it as a basis for their

schedules of specific commitments.14 However, some WTO Members contend that

this classification does not reflect current market conditions,15 and are promoting the

use of a new classification scheme during the current round of WTO services

negotiations.16

In general, cross-border trade in waste products is a goods issue and is not included

within the scope of the solid or hazardous waste services trade. However, regulations

affecting trade in wastes may affect the provision of services if such trade involves

the cross-border transfer of waste between treatment or disposal facilities. Thus, such

regulations are addressed within the study. In contrast, cross-border trade in sorted

recyclable waste products falls completely outside the scope of this report, as many

of these products are valuable commodities that recycling facilities sell as inputs to

manufacturing processes.
 17 Environmental Business International (EBI), a principal source of the data presented in

this study, defines the solid and hazardous waste management industries to include collection,

transportation, and transfer of solid waste; recycling operations; composting; solid waste

disposal at landfills and incinerators; and the management of medical, nuclear, and hazardous

industrial waste.

 18 EBI, The Global Environmental Market by Segment, attachment to an e-mail message,

received July 31, 2003.

 19 More specifically, in 2000, the United States accounted for $39.8 billion, or 34.5 percent,

of the global market for solid waste management services, and $5.2 billion, or 30.1 percent, of

the global market for hazardous waste management services. Environmental Business

International (EBI), The Global Environmental Market by Region, 2000, attachment to an email message, received July 31, 2003. 

 20 EBI, The Global Environmental Market by Region, 2000, attachment to an e-mail

message, received July 31, 2003. 

 21 Environmental Business Journal, vol. XV, No. 11/12, 2003, p. 3.

 22 EBI, EBI’s Products by Industry Segment, found at Internet address

http://www.ebiusa.com/segments.html, retrieved Jan. 29, 2004.

 23 EBI, EBI Report 2000: The U.S. Environmental Industry and Global Market, Sept. 2001,

p. 1-3.

1-4

The Global Market for Solid and Hazardous Waste

Services

In 2001, the most recent year for which global data are available, solid waste

management services and hazardous waste management services17 accounted for 43

percent and 6 percent of the $279-billion worldwide environmental services market,

respectively.18 The United States is the world’s largest market for solid and

hazardous waste services. In 2000, the United States accounted for $45 billion, or 34

percent, of the global market for solid and hazardous waste services.19 Other key

markets for such services included Western Europe and Japan (figure 1-1), which

respectively accounted for 30 percent and 26 percent of the combined global market

for solid and hazardous waste management services.20 The global solid and

hazardous waste services industry has been consolidating as large firms have merged

to expand their range of goods and services offerings, thereby improving their

competitive posture. In 2001, the world’s largest solid and/or hazardous waste

services firms included Onyx (a subsidiary of French firm Veolia Environment, solid

and hazardous waste services), Sita (a subsidiary of French firm Suez, solid waste

services), Waste Management Inc. (United States, solid waste services), Allied Waste

(United States, solid waste services), and RWE Entsorgung (Germany, solid waste

services).21

Typically, the most prominent consumers of solid waste management services are

municipalities, and industrial and commercial clients. Principal consumers of

hazardous waste management services include government agencies, and chemical

and petroleum production and processing facilities.22 Both public-sector and privatesector firms participate in most solid and hazardous waste services markets

throughout the world. In 2001, the private sector accounted for 69 percent of revenue

generated by the U.S. solid waste management services industry, and for 96 percent

of revenues generated by the U.S. hazardous waste services industry.23 In many other

developed markets, the public/private ratios for solid and hazardous

 27 Industry representative, interview with USITC staff, Washington, DC, Nov. 5, 2003.

 28 It would reportedly cost a total of $70 billion per year to manage municipal solid waste

in developing countries. Data contained in David Waskow, International Policy Analyst and

Trade Policy Coordinator, Friends of the Earth-USA, Washington, DC, written submission to

the Commission, Nov. 5, 2003.

 29 Industry representative, interview with USITC staff, Washington, DC, Nov. 12, 2003.

 30 For more information regarding GATS commitments on refuse disposal services, see

appendix C.

 31 A large share of all environmental services trade, including solid and hazardous waste

services trade, likely takes place through modes 3 and 4; i.e., production and consumption

occur inside the territorial/legal jurisdiction of the importing state.

1-6

providers often faced excess demand due to a backlog of existing work that needed to

be completed under the new regulations. In the United States and other developed

countries, most waste-generating firms have had time to comply with the

environmental standards, and have moved forward toward reducing or eliminating

waste before it is generated, further reducing the need for environmental services.27

Consequently, cleaner technologies– those that reduce pollutants at the source– and

resource management are likely to be areas of future emphasis and growth, although

industry revenues will derive principally from providing waste management,

pollution control, waste cleanup, and other “end-of-pipe” services.

In many developing countries, solid and hazardous waste services markets are small,

but are experiencing rapid growth. In these countries, the environmental reform

process is just beginning, often in response to a critical need for environmental

improvements. Many countries have expressed significant interest in environmental

issues, going so far as to pass strict environmental legislation. However, many of

these countries lack the funds to carry out their ambitious environmental programs.28

Industry reports that this lack of capital is the most significant hurdle facing the 

development of solid and hazardous waste management markets in newly

industrializing countries.29

Approximately 30 percent of WTO Member States made commitments on refuse

disposal services under the GATS.30 Restrictions on trade specified in these

commitments are limited. However, measures included in Member countries’

horizontal commitments--which generally focus on purchase or rental of property,

equity holdings, residency requirements for directors, tax and subsidy measures, and

visa provisions such as quotas and length of stay31--as well as measures affecting

related sectors such as architecture, engineering, or construction may have an

important impact on the foreign provision of waste management services. Potential

impediments to trade that fall outside the scope of the GATS may increase the cost of

supply, reduce demand, or eliminate the provision of the service altogether. For

example, as governments are among the principal consumers of solid and hazardous

waste services, preferential public procurement practices may serve as restrictions on

the foreign provision of a service. 

Approach

This report presents an overview of the global market for solid and hazardous waste

services, organized by region. Chapter two of this report presents a literature review
 32 The Commission had gathered for presentation in this report the most up-to-date and

detailed trade and investment data available. There is a considerable paucity of data in this

field. For this reason, the Commission complements available data with characterizations of

trade flows and balances where necessary and appropriate.

1-7

of extant work on service technologies, market trends, trade, and investment in the

solid and hazardous waste services industries. Chapters three through seven examine

solid and hazardous waste in the United States, Canada and Mexico, Europe, Asia

and the Pacific, and certain developing-country markets in other world regions. 

These chapters follow a similar format that includes a market overview for each

region, an examination of the trade and investment environment insofar as data

permit,32 and a discussion of future prospects for the solid and hazardous waste

services industry. In addition, each chapter includes profiles of selected markets, in

which market and trade information for key regional markets is presented. Chapter 8

summarizes the information presented in previous chapters to reveal current trends in

the global solid and hazardous waste services market. Additional information –

including the USTR’s request letter, the Federal Register notice, data on disposal

methods, an overview of GATS commitments and negotiations on solid and

hazardous waste services, positions of interested parties, and a glossary of terms –

can be found in the appendicies to this report.

 1

 William Rathje and Cullin Murphy, Rubbish! The Archeology of Garbage (Tucson:

University of Arizona Press, 2000).

 2

 The definition of municipal solid waste (MSW) varies from country to country, as do

most other definitions pertaining to waste flows and disposal. For the purposes of this

chapter, the term as used here generally excludes hazardous waste. The Organization for

Economic Cooperation and Development (OECD) describes municipal waste as “waste

collected and treated by or for municipalities,” including “waste from households, similar

waste from commerce and trade, office buildings, institutions and small businesses, yard and

garden waste, street sweepings, the content of litter containers, and market cleansing waste”

and excluding municipal sewage waste and municipal construction and demolition waste. 

(OECD Environmental Data Compendium 2002: Waste (Paris: OECD), p. 10) OECD data on

solid waste generated by sector for the United States consists only of municipal solid waste. 

OECD data for other countries includes a significant quantity of waste generated by the

agriculture, manufacturing, mining, energy, water, construction and other sectors. It is not

clear where data on such waste streams fits into U.S. data reporting systems.

2-1

CHAPTER 2

SOLID AND HAZARDOUS WASTE

SERVICES: INDUSTRY OVERVIEW

AND LITERATURE REVIEW

Introduction

This chapter provides background on the types of materials included in solid and

hazardous waste streams and the technologies of collection, treatment, and disposal. 

As noted, differences in technology (between methods of disposal, between

countries, and over time) influence the conditions of supply in the industry. Changes

in the amount of waste generated and in the state of regulation influence the

conditions of demand. These fundamental determinants of supply and demand, in

conjunction with other forces such as economic growth and the relative prices of

energy and recyclable materials, influence the structure of the industry. This chapter

draws on a variety of sources in discussing these economic considerations, including

published economic analyses, industry and trade journals, and published data. 

Data pertaining to solid and hazardous waste pose special challenges in terms of

definitions and comparability between geographic locations and over time. For

example, the U.S. Environmental Protection Agency (EPA) estimates the types of

materials entering the solid waste stream based on production and materials flows

passing through the economy, adjusted for international trade and estimates of

product lifetimes and supplemented with survey data. Alternately, the composition

of certain solid waste streams can be estimated directly by sampling the contents of

landfills, as in the University of Arizona’s Garbology Project.1

 The trade publication

Biocycle estimates the amount of U.S. municipal solid waste (MSW),2

 and its

distribution among management technologies such as landfilling, recycling, and

incineration, by gathering data from state-level authorities. Biocycle estimates of
 3

 Richard C. Porter, The Economics of Waste (Washington, DC: Resources for the Future,

2002), p .4.

 4

 Environmental Business International, Inc. (EBI), EBI Report 2000: The U. S.

Environmental Industry and Global Market, Sept. 2002, pp. 1-3, 1-4. Of the private-industry

revenues originating from private-sector clients, about 60 percent ($9.8 billion) is estimated as

paid for by industrial clients and about 40 percent ($6.5 billion) by commercial or other

clients.

 5

 USITC calculations based on table 1-1 in Porter, The Economics of Waste, p. 3.

2-2

annual generation of MSW in the United States can be as much as 50 percent higher

than EPA estimates.3 The variety of methods used to compile waste-related data,

and the discrepancies between them, imply that many of the characterizations of the

industry below should be considered as tentative. 

Activities and Technology 

Solid Waste 

Sources of Solid Waste 

An estimated 60 percent ($24.5 billion) of U.S. solid waste management revenues in

2001 were generated by public-sector customers, with the other 40 percent ($16.3

billion) originating in the private sector. By contrast, 31 percent ($12.7 billion) of

revenues were earned by public-sector entities, while the balance of U.S. revenues

were earned by the private sector.4

 This implies that the public sector in the United

States pays the private sector to supply about half of the solid waste management

services it consumes while supplying the other half itself. Waste management

services purchased by the public sector generally include disposal services for MSW,

which is generated by households and small industrial or commercial establishments

that rely on the municipal disposal system, as well as disposal services for

government entities. Small industrial or commercial establishments may also

contract directly with private firms to dispose of their waste, or engage in selfdisposal (for example, households may haul trash in a private vehicle directly to a

local landfill or recycling center).

The physical composition of solid waste varies widely from country to country, in a

way which reflects consumption patterns at different levels of income. For example,

one study found that about 75 percent of solid waste in urban areas of India consists

of putrescent matter (primarily food wastes), with another 15 to 20 percent consisting

of ceramics, dust, ash, and stones. In the United States, by contrast, less than 40

percent of waste is putrescent matter, while over 60 percent consists of materials such

as paper, plastic, rubber, leather, glass and metals which represent discarded or wornout manufactured goods.5

 These materials are relatively scarce in developingcountry waste, and are often removed by scavengers before the waste reaches an
 6

 In Jakarta, for example, scavengers regularly tore apart MSW that had already been

machine-compacted and baled by the city’s sanitation agency. See Carl R. Bartone, Janis D.

Bernstain, and Frederick Wright (1990), Investments in Solid Waste Management:

Opportunities for Environmental Improvement. Policy, Research and External Affairs

Working Paper No. 405 (Washington, DC: World Bank, Infrastructure and Urban

Development Department, 1990), pp. 18-19.

 7

 U.S. International Trade Commission, The Dynamic Effects of Trade Liberalization: An

Empirical Analysis (Publication 3069, Oct. 1997), pp. 10-10 to 10-15. 

 8

 Data arising from the Calcutta Municipal Corporation show that between 1970 and 1993

the share of municipal wastes in Calcutta (now Kolkata) accounted for by paper, polythene,

plastic, glass, metal, and rubber increased from 5.35 percent to 12.15 percent, with the share

of “vegetable and putrescible fractions” remaining fairly steady at 40.37 percent in 1970 and

41.00 percent in 1993. Of the latter, coconut shells alone account for 6.20 percent of

municipal wastes and rising. See Snigdha Chakrabarti, Indian Statistical Institute,

“Economics of Solid Waste Management: A Survey of the Existing Literature,” 2003,

processed.

 9

 Porter, The Economics of Waste, p. 52.

 10 Jerry A. Nathanson, Basic Environmental Technology: Water Supply, Waste

Management, and Pollution Control, 4th addition (Upper Saddle River, New Jersey and

Columbus, Ohio: Prentice-Hall, 2003), p. 339.

2-3

organized disposal process, or during that process.6

 The lower ratio of putrescent

matter to manufactured material in U.S. wastes may be due, in part, to greater

consumption of processed foods and to the use of household garbage disposals,

which direct wastes to water and wastewater treatment facilities. Waste is the byproduct of consumption, and these patterns are consistent with the higher share of

food in the material consumption of developing countries and the higher share of

manufactures in the material consumption of developed countries.7

 In the course of

development, the composition of waste may gradually evolve in the direction implied

by developed-country consumption patterns.8 

These patterns of waste composition have implications for collection and disposal

techniques. Putrescent matter is moist and relatively resistant to compaction. It can

be landfilled, composted, or burned at an incinerator or waste-to-energy facility, but

generally cannot be recycled by other means. Its moisture content may also cause

breakdown in the operation of compacting garbage trucks, which are expensive to

repair.9

 Putrescent matter is biodegradable. The process of biodegradation causes

release of greenhouse gases such as methane and carbon dioxide, which are noxious

at ground level and (in the case of methane) explosive. Recovered methane can be

used for energy generation, as will be discussed in the section on landfills below. 

The disposal of “hard” manufactured materials such as paper, glass, and metal yields

nonbiodegradable wastes. These wastes are both easier to compact and more likely

to be recyclable than biodegradable wastes. Paper waste is amenable to the greatest

number of techniques of disposal, as it is recyclable, biodegradable, and compostable

(though with less efficiency than food wastes), and can be burned in incinerators.

Collection 

About two-thirds of the costs of MSW management in the United States are related to

collection and transportation of the material from the point of generation to the

location of processing and ultimate disposal.10 This can include temporary storage or

containerization of the waste at a transfer station. Part of these costs relate to the
 11 Linda N. Edwards and Franklin R. Edwards, “Wellington-Winter Revisited: The Case of

Municipal Sanitation Collection,” Industrial and Labor Relations Review, vol. 35, No. 3, Apr.

1982, pp. 307-318.

 12 By contrast, incineration can reduce volume of MSW by about 90 percent and weight by

about 75 percent. Nathanson, Basic Environmental Technology, p. 343.

 13 Porter, The Economics of Waste, pp. 51-52.

 14 “The State of Garbage in America,” Biocycle, vol. 42, No. 12, Dec. 2001, p. 43.

 15 Nathanson, Basic Environmental Technology, p. 341.

 16 Porter, The Economics of Waste, p. 50 and studies cited thereat; and Nathanson, Basic

Environmental Technology, pp. 341.

2-4

labor-intensive nature of garbage truck operations; unionized sanitation workers,

particularly in public-sector operations, have significant bargaining power.11

Municipal garbage-compacting trucks can reduce waste volumes by over 50 percent. 

For materials that will eventually be landfilled, most of the volume reduction takes

place in this compacting operation.12 Waste collection operations have relatively few

economies of scale and thus are naturally decentralized to the municipal level, though

some large firms own and operate collection facilities.

Waste collection is an even more labor-intensive activity in developing countries,

where carts or non-compacting vehicles may be used, accompanied by crews with

baskets, shovels, or cans. The use of non-closed vehicles can lead to spillage back

onto the street. As noted above, capital-intensive compaction technologies may be

less appropriate for developing-country waste, because of its high share of putrescent

matter. In addition, large and wide trucks may not fit through narrow developingcountry streets.13 Alternatively, households may bring trash to neighborhood bins or

“skips,” which are periodically emptied. In poorer countries, a significant share of

trash may go uncollected because neither households nor governments are willing or

able to fund a comprehensive collection program.

The high costs of transportation provide strong incentives for the establishment of

transfer stations. For example, the number of landfills in the United States has

decreased sharply over time, from nearly 8,000 in 1988 to 2,142 in 2000;14 thus, the

average distance from individual households and commercial establishments to the

landfill has correspondingly increased. This has provided incentives for the

establishment of transfer stations. Transfer stations permit the achievement of some

economies of scale, as compacted waste from up to eight individual trucks can be

consolidated onto a single tractor-trailer which then makes only one trip to the

landfill and back.15 The incentives to establish transfer stations vary depending on

transport costs, the initial capital cost of the transfer station, and the degree of

realizable economies of scale associated with consolidation into larger trucks. 

Typical estimates indicate that the economical limit for one-way waste hauling by an

individual truck is approximately 12-20 miles.16
 17 For a comparison of the predominant disposal methods employed in certain countries and

U.S. states, see appendix C.

 18 Leachate is the contaminated liquid by-product of solid waste that has percolated through

the soil or some other medium. Environmental Protection Agency (EPA), “Terms of

Environment,” found at Internet address http://www.epa.gov/OCEPAterms/lterms.html,

retrieved Mar. 17, 2004; and Nathanson, Basic Environmental Technology, p. 511.

 19 Nathanson, Basic Environmental Technology, pp. 361-370.

 20 For example, in the United States, the Resource Conservation and Recovery Act (RCRA)

of 1976 banned open dumping. A 1988 EPA report prepared under the Hazardous and Solid

Waste Amendments of 1984 led to the promulgation of new regulations in 1991, which were

phased in during 1991-1998. These regulations, known as the Solid Waste Disposal Facility

Criteria, in many cases represented a significant tightening of existing state standards; in other

cases state standards were and remain higher. The criteria require that solid waste landfill

operators demonstrate their ability to pay for closure, postclosure care, and cleanup of

landfills; prevent hazardous waste from being accepted; control insects and rodents; monitor

methane gas leakage; and cover landfills with six inches of soil at the end of each day. 

Operators of landfills must not burn wastes or accept liquid wastes, and may not locate in

environmentally unsafe areas. (Porter, The Economics of Waste, p. 60). See chapter 5 for more

information on the U.S. regulatory system.

2-5

Methods of Disposal 17

Landfilling 

Removal of municipal solid wastes to centralized locations outside city limits is a

practice that dates to ancient times. The modern sanitary landfill incorporates a

number of technological processes that distinguish it from an open dump. These

include:

• pre-preparation of the site, preferably with an impermeable liner to minimize

contamination of groundwater by leachate;

• spreading out and compacting the waste with heavy machinery, which prolongs

the life of the landfill by reducing volume;

• covering the waste each day with a layer of compacted soil, which minimizes gas

release into the atmosphere;

• monitoring of water quality of leachate18 and, if necessary, collection and

treatment of leachate to an appropriate standard.19

The relative costs of landfilling depend on the value of land in alternate uses. 

Landfills tend to be more prevalent in lightly populated areas than in densely

populated locations where real estate values are higher. Costs associated with

landfilling also have reportedly increased as regulatory standards have increased over

time.20 Owing to the presence of regulatory costs, economies of scale in landfilling

are significantly greater than in waste collection. Thus, there has been a trend toward

fewer and larger landfills, with each one being supplied with waste from a growing

number of sources.

Closed landfills may be restored and converted to such uses as parks, golf courses, or

in some cases paved over and put to commercial use. Regulatory standards and

liability issues usually preclude closed landfills from being reconverted to residential

use.
 21 Porter, The Economics of Waste, pp. 67-69.

 22 Nathanson, Basic Environmental Technology, pp. 367-368.

 23 EPA, found at Internet address http://www.epa.gov/docs/epacfr40/chapt-I.info/60tc.htm/,

retrieved Nov. 14, 2003.

 24 Nathanson, Basic Environmental Technology, p. 343. 

 25 Porter, The Economics of Waste, p. 77.

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Landfill gas is produced as a result of the natural decomposition of the organic

component of solid waste. After aerobic bacteria absorb the oxygen in the soil,

anaerobic bacteria produce methane and other gases, which can pass through soil or

rise to the surface, accumulating in basements and similar structures. If not captured,

methane mixed in sufficient concentrations with air can be explosive, and can also

cause death by poisoning if directly inhaled. Minimization of such hazards without

commercial recovery of the gas is accomplished by gathering the gas in a perforated

pipe installed in a “vent layer” of the landfill cap and releasing the gas through a

pipe. Facilities for landfill gas recovery are costly, but the production of a saleable

product may compensate for these costs and, if profitable, pay for other costs of

maintaining a closed landfill. The potential profitability of a landfill gas recovery

operation is difficult to determine ex ante.

21

Commercial recovery of methane is accomplished through the use of gas extraction

wells and membrane permeation systems, which permit separation of the saleable

methane from CO2 and other unsaleable gases. In a sufficiently moist landfill, gas

production occurs rapidly at first and is mostly complete after about 20 years. 

However, the rate of decomposition, and thus the rate of gas production, can be

accelerated by adding moisture.22 Natural gas can be sold or used to generate

electricity which can be sold to the grid. Landfill gas recovery operations are

regulated primarily for air pollution purposes.23

Incineration 

In most cases, incineration of MSW is performed for the purposes of waste-to-energy

conversion, though a small amount of incineration for pure volume reduction appears

to take place in Japan and other countries. As a technology for reducing the volume

and weight of solid waste, incineration often outperforms such alternatives as

shredding, pulverizing, baling, and (for organic wastes) composting, reducing

volume by about 90-95 percent and producing both “bottom ash” and “fly ash,”

which rises in flue gases. Much of the fly ash can be recaptured with air pollution

control technologies, and then tested to see if it warrants disposal as hazardous

waste.24 Bottom and fly ash can also be combined with lime and water to form road

construction base material. This method of ash disposal is particularly popular in

Europe.25 Some incinerator ash is also landfilled in what are known as “monofills,” a

specialized form of hazardous-waste disposal facility.

The relative cost of land affects the incentives for incineration. A higher share of

MSW is incinerated in affluent, land-poor areas than in land-abundant locations. 

Incineration is usually a revenue-generating operation since the vast majority of

incinerators worldwide are waste-to-energy operations, using the combustion process

to heat boilers which drive steam turbines for electricity generation. Since

incineration is a continuous-flow process, it is significantly more likely to be efficient

from an engineering standpoint, and profitable from an economic standpoint, when
 26 Ibid., pp. 70-85; and Jeffrey Morris, “Competition Between Recycling and Incineration,”

prepared for Gowling, Strathy and Henderson on behalf of the City of Toronto, Ontario, 1996,

found at Internet address http://www.mindfully.org/Plastic/Recycling-And-Incineration.htm/,

retrieved Nov. 14, 2003.

 27 “The State of Garbage in America,” Biocycle, p. 46.

 28 For example, in 1997 Chicago announced that it was meeting a state-level goal of 25

percent recycling, half of which was accounted for by yard waste used as landfill cover. Since

landfill cover is useful (on the landfill, rather than in it), this counted as recycling even though

the yard waste included so much glass and other debris as to be uncompostable. In 1996 New

York City raised its reported recycling rate from 14 percent to the legally mandated 25 percent

by counting as recycled abandoned autos that the city towed and sold to junkyards, as well as

construction debris that was pulverized and used for road construction at the Fresh Kills

landfill. Porter, The Economics of Waste, p. 4.

 29 Nathanson, Basic Environmental Technology, pp. 352-360.

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the incinerator receives a continuous flow of waste. This enables the full economies

of scale of the incinerator equipment to be exploited. For this reason, it is customary

for incinerators to engage in contracts with governments in order to guarantee a

stream of inputs. Nonetheless, reductions in available materials resulting from

increased recycling or cost reduction efforts by business, combined with increases in

regulatory costs have meant that many incinerators operate below capacity. This, in

turn, has led to the closure of facilities or to significantly higher tipping fees relative

to landfills.26

Recycling 

Metal, glass, plastic, paper, and other manufactured materials that enter the waste

stream can potentially be withdrawn therefrom and reprocessed for use as production

inputs. Recycling is commonly associated with the materials described above, which

are the focus of household trash sorting for curb pickup or delivery to the recycling

center. However, some states classify composting; the recovery of scrap autos,

motor oil, construction and demolition debris, household batteries, or ash; and “foodto-people” programs as recycling while others do not.27 The absence of a uniform

definition creates both a potential lack of comparability in data for different

geographical locations and across time, as well as difficulties in interpreting the

results of government-mandated recycling targets.28 

In practice, recycling can be accomplished through a variety of technologies,

including household hand sorting and curbside collection of sorted or unsorted

materials. Specialized recycling trucks now exist, which store paper and commingled

glass, metals, and plastics in separate compartments. The commingled materials can

be delivered to a materials recycling facility (MRF) which uses a combination of

electromagnetic separation, vibration, air blowing, and hand sorting to separate the

materials into marketable components, while paper (newsprint, cardboard, and mixed

paper including magazines and junk mail) is handled in a separate stream.29 

The recovery rate is highest for materials for which the cost of recycled materials is

low relative to virgin materials. The relative energy costs of producing recycled and

virgin materials are a significant determinant of total relative costs. For example,

aluminum, which accounts for less than 1.5 percent of MSW, provides the largest

share of recycling revenue (perhaps more than 50 percent) because of the high energy

costs associated with extracting aluminum from bauxite ore. 
 30 Such a requirement was imposed in Germany in 1991, and led to the “Green Dot”

program, which is implemented as a separate materials collection system, Duales System

Deutschland (DSD), operated by a consortium of German manufacturers and running in

parallel to government municipal waste collection. Porter, The Economics of Waste, pp. 33-

34. 

 31 “The State of Garbage in America,” p. 43.

 32 A retrospective account is given by Aaron Rutkoff et al., “BP Shulman Makes A Stink

Over Unwanted Garbage Barge,” found at Internet address

http://www.queenstribune.com/anniversary2003/garbagebarge.htm/, retrieved Nov. 14, 2003.

 33 In retrospect, as the Mobro’s voyage was an anomalous and nonrecurring event, it was

probably not an indicator that the United States was running out of landfill space.

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In principle, the incentives for recycling should vary with both the prices of

recoverable materials (positively) and the price of land (also positively). When land

is expensive, other things being equal, markets encourage both recycling and

incineration at the expense of landfills. The propensity to recycle is also influenced

by other economic and noneconomic factors. A large share of the recyclable waste

stream is paper, a combustible material that is in high demand by incinerators. 

Recycling is encouraged by government policies such as mandated targets for

recycling, container deposit legislation, and requirements that manufacturers gather

and dispose of the packing waste they produce.30

Regardless of data issues, it seems clear that the share of U.S. waste managed

through recycling has increased sharply since the late 1980s, going from about 8

percent of MSW in 1990 to 31 percent in 2001.31 It is unclear whether economic

incentives such as land scarcity or rising prices for recyclables are primarily

responsible for this trend. Landfill tipping fees and the prices of recyclable materials

such as aluminum, newspaper, and cardboard have increased only modestly in the

last 15 years, and at times have undergone price reversals, while the increase in the

share of MSW devoted to recycling has increased virtually without pause. This

suggests that consumer attitudes and changes in household behavior may have had a

significant effect on recycling rates. It is interesting to note that the initial upsurge in

recycling corresponds in time with the 1987 odyssey of the garbage barge Mobro

4000 from Queens, New York. The Mobro was denied landing rights by five states

and two Latin American countries, due to allegations that samples of its contents

contained hazardous waste.32 This story was widely covered by the news media and

likely had an effect on public discussion of solid waste treatment policy and

recycling.33

Illegal disposal 

While illegal disposal is not per se an activity of the solid and hazardous waste

services industry, a brief mention of this phenomenon is warranted in order to

complete the picture of the flow of materials in the industry. The service of handling

and treating wastes is costly. Haulers pay tipping fees to landfills and incinerators,

and in some cases, businesses and households pay fees (other than mandatory local

taxes) directly to haulers. Alternately, households may have to buy or rent

designated bags or cans in order to receive curbside hauling service. Any attempt to

implement a “pay-as-you-throw” principle, and thus to align private and social costs

of waste removal and treatment, may create incentives to avoid payment by illegal

dumping (also known as “midnight dumping” or, in Britain, “fly tipping”). Illegal
 34 H. Sigman, “Midnight Dumping: Public Policies and Illegal Disposal of Used Oil,”

RAND Journal of Economics, vol. 29, No. 1, Spring 1998, pp. 157-178. 

 35 USC Title 42, Chapter 82.

 36 The text of RCRA is available at the Legal Information Institute, U.S. Code Collection,

found at Internet address http://www4.law.cornell.edu/uscode/42/6903.html/, retrieved on

Nov. 17, 2003.

 37 Metric units generated by USITC calculation.

 38 U.S. Environmental Protection Agency, The National Biennial RCRA Hazardous Waste

Report (Based on 2001 Data), found at Internet address

http//:www.epa.gov/epaoswer/hazwaste/data/brsol/national.pdf/, retrieved Nov. 17, 2003, pp.

1-3, 1-4; and USITC calculations.

 39 U.S. Environmental Protection Agency, The National Biennial RCRA Hazardous Waste

Report, pp. 1-4. Basic chemicals, petroleum and coal refining, and rubbers, plastics,

synthetic fibers and related industries accounted for 58.5 percent of all recorded hazardous

wastes in 2001 (p. 1-7 and USITC staff calculations).

 40 As mentioned in chapter 1, information regarding the management of high-level nuclear

wastes generally was not collected for this report.

2-9

dumping can take place in a variety of forms, including littering or the unauthorized

use of commercial dumpsters by households. Hazardous wastes may also be illegally

dumped. According to some estimates, as much as 13 percent of used oil in the

United States may be dumped illegally, purportedly as a consequence of policies in

about two-thirds of the states that prohibit used oil disposal except by special

treatment.34 Thus, an increase in the relative price or the regulatory restrictions

associated with any mode of disposal can cause both substitution toward other modes

of disposal, and possibly an increase in illegal dumping, which may reduce the

revenues available to the waste management industry, but is particularly difficult to

quantify.

Hazardous Waste 

Hazardous waste is defined in the regulatory system by the potential effects of the

waste. For example, in the United States, the Resource Conservation and Recovery

Act (RCRA) of 1976 as amended35 defines hazardous waste as solid wastes that “may

cause, or significantly contribute to an increase in mortality or an increase in serious

irreversible, or incapacitating reversible illness ... or pose a substantial present or

potential hazard to human health or the environment when improperly treated, stored,

transported, or disposed of...”36 Hazardous waste generation is concentrated among a

few sources. In 2001, 19,000 different sources produced 37.1 million metric tons37 of 

hazardous waste in the United States, but the top 50 sources accounted for about twothirds of the total.38 In practice, a large share of waste classified as hazardous in the

United States originates in the chemical and petrochemical industries. More

specifically, in 2001 the top 17 generators of hazardous waste in the United States

were all either chemical firms or refiners.39 The management of medical wastes and

nuclear wastes40 accounted for approximately 27 percent and 18 percent, 
 41 EBI Report 2000, p. 11-2.

 42 This refers to on-site use of chemical byproducts as fuels, including fuel blending. Fuel

blending prior to energy recovery at another site is classified separately by the EPA.

 43 U.S. Environmental Protection Agency, The National Biannial RCRA Hazardous Waste

Report, pp. 2-35.

 44 Nathanson (2003), pp. 373-395.

 45 V. Kerry Smith and William Desvouges, “The Value of Avoiding a LULU: Hazardous

Waste Disposal Sites,” Review of Economics and Statistics, vol. 68, No. 2, May 1986, pp.

293-299. The acronym LULU denotes “locally undesirable land use.”

 46 See Bruno S. Frey, Felix Oberholster-Gee and Reiner Eichenberger, “The Old Lady

Visits Your Backyard: A Tale of Morals and Markets,” Journal of Political Economy, vol.

104, No. 6, pp. 1297-1313, Dec. 1996, which analyzes this phenomenon in the case of a Swiss

search for a nuclear waste depository. 

 47 Robert Cameron Mitchell and Richard T. Carson, “Property Rights, Protest, and the

Siting of Hazardous Waste Facilities,” American Economic Review, vol. 76, No. 2, May 1996,

pp. 285-290.

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respectively, of total revenues of the U.S. hazardous waste services industry in 2001,

while the management of industrial wastes accounted for the balance of revenues.41

Methods of Disposal

Hazardous wastes are disposed of by a large variety of methods. The top six

methods, accounting for over two-thirds of U.S. managed hazardous wastes for

which the disposal or treatment method is recorded, are (1) deepwell or other

underground injection, (2) aqueous organic treatment, (3) aqueous inorganic

treatment, (4) landfill/surface impoundment, (5) energy recovery,42 and (6)

incineration.43 Aqueous treatment of wastes involves oxidation/reduction reactions to

neutralize acidic or metallic contamination. Technologies that are similar to those

used to dispose of nonhazardous solid wastes generally are modified to deal with the

toxic nature of hazardous wastes. For instance, buried hazardous waste drums may

include additional filtering layers to control leachate. The transportation of

hazardous waste is more heavily regulated than the transportation of solid wastes. In

the United States, hazardous waste transportation includes labeling of containers and

trucks and the maintenance of manifests for tracking purposes.44

Siting 

There is an extensive literature on the siting of hazardous waste facilities. Many

people are unwilling to live close to a hazardous waste facility, even if it is

regulated.45 The relative scarcity of publicly acceptable sites for hazardous waste

disposal as compared to solid waste disposal requires the transport of hazardous

wastes over longer distances on average and makes the realization of economies of

scale in disposal or treatment relatively more important.46 The conflict between

desires of homeowners to avoid living near a hazardous waste facility and broader

social desires for disposal or treatment of such wastes can also lead to postponement

of final disposal and treatment decisions and increase incentives for illegal

“midnight” dumping.47
 48 David N. Beede and David E. Bloom, “Economics of the Generation and Management of

Municipal Solid Waste,” NBER Working Paper No. 5116, ( Cambridge, Mass.: National

Bureau of Economic Research, May 1995).

 49 See Nemat Shafik and Sushenjit Bandyopadhyay, Economic Growth and Environmental

Quality: Time-Series and Cross-Country Evidence," World Bank Working Paper No. 904,

1992, (Background Paper for World Development Report 1992) for an early example of this

research. 

 50 For a general review of the literature on the association of environmental policy with per

capita income, see Simone Borghesi (1999), “The Environmental Kuznets Curve: A Survey of

the Literature,” found at Internet address

http://www.feem.it/NR/rdonlyres/1D089671-FFCF-42F9-BA15-DEB9E2A581F1/138/8599.pd

f/, retrieved Dec. 9, 2003. For recent findings questioning the conventional inverted-U shape

found with respect to air pollution, see William T. Harbaugh, Arik Levenson, and David

Molloy Wilson, “Reexamining the Empirical Evidence for an Environmental Kuznets Curve,”

Review of Economics and Statistics, vol. 84, No. 3, Nov. 2002, pp. 541-551.

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Waste Generation and Demand 

Across countries, the generation of MSW increases both as population increases and

as per capita income increases, but is probably more closely tied to population than to

income. World Resources Institute data cited in Beede and Bloom (1995) indicate

that Australia’s per capita generation of MSW by weight was less than four times that

of Mozambique in 1990, though Australia’s per capita income was over 27 times that

of Mozambique. Similar patterns hold for other countries. The authors’ estimates

based on cross-country data imply that the elasticity of national MSW generation

with respect to population is around 1.04 (i.e., a one-percent increase in population

leads to about a one-percent increase in MSW), while the elasticity with respect to

per capita income is around 0.34 (i.e., a one-percent increase in per capita income

leads to about a one-third percent increase in MSW). Estimates on time-series data

for Taiwan and the United States yield income elasticities which are higher than the

cross-country estimate, but still less than 1. Thus, it seems likely that the global

distribution of MSW is disproportionately in developed countries when viewed in

proportion to population, but disproportionately in developing countries when

viewed in proportion to national income.48

There is evidence that countries prioritize environmental issues according to per

capita income, following a hierarchy-of-needs approach in which the lowest-income

countries direct limited resources to address the most urgent problems by adopting

technologies that are appropriate to their particular needs. Increases in income may

result in the assignment of resources to additional environmental problems.49 For

example, even small improvements in per capita income are associated with

improvements in drinking water quality, because of the high rate of mortality and

morbidity associated with water-borne diseases. Air and water pollution have

sometimes been said to follow “environmental Kuznets curves” with an inverted Ushape, getting worse as countries advance from low-income to middle-income status

and then improving, although this finding has been questioned by more recent

research.50 The World Bank’s World Development Report 1992 reported a positive

association between MSW per capita and per capita income across the entire range of

per capita income, reinforcing the idea that waste production increases with per

capita income. While affluent countries are likely to devote more resources to all

environmental problems, this finding may suggest that demand for solid and
 51 EBI Report 2000, pp. 9-31 and 9-32.

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hazardous waste management may be even more likely to be concentrated in

developed countries than demand for other environmental services. The findings of

this report, as illustrated in chapter 8 (figure 8-1), also suggest that there is a positive

relationship between per capita income and per capita MSW generation. 

Industry Structure 

Size and scale of firms

Because of the economies of scale in landfilling and incineration, large firms have a

comparative advantage in the solid waste management market. As discussed above,

the steadily declining number of landfills in the United States has been linked to the

push for greater economies of scale in this market segment. There are approximately

12,000 private firms and municipalities that provide solid waste services in the

United States. Three of these firms !Waste Management, Inc. (WMI), Allied Waste

Industries, and Republic Services ! account for 47 percent of private revenues from

MSW, and the top 13 firms account for 58 percent of such revenues. In the

subcategory of waste-to-energy (incineration), three firms (Ogden Projects,

Wheelabrator Technologies, and American Ref-Fuel) account for 54 percent of

revenues.51 As the United States is the world’s largest market for solid waste

management services, it follows that if the degree of technological economies of

scale in landfilling and incineration in the U.S. market were captured in other

markets, the number of sustainable firms in those markets would be correspondingly

smaller. A possible exception is Japan, where the total quantity of MSW incinerated

is about 20 - 30 percent larger than the U.S. level, depending on whether waste-toenergy incineration or all incineration is included. Thus, it is in principle possible

that the size of the Japanese market allows either a larger minimum efficient scale of

incinerator, or more incinerators, or both.

Organization of firms

As alluded to above, there are economies of scale for industrial landfills. This is also

true for incinerators, due to the engineering characteristics of process flow

technologies. There may be further economies of scale in jointly operating a network

of transport facilities, transfer stations, and landfills over a large geographical area in

such a manner as to take full advantage of the potential tradeoffs between scale

economies and transport costs. 

There are also advantages to internalization of related activities within firms, either

through vertical integration or self-provision of services. Advantages (both technical

and financial) in vertical integration between hauling and disposal activities include

stability in disposal prices as companies are reluctant to raise tipping fees on their

own trucks. Also, control of collection routes ensures a constant supply of materials

into company-owned landfills and prevents defections when competitors reduce

tipping fees. Of course, the key to this integration is to maximize what industry

participants call the “internalization ratio,” the amount of waste hauled by the firm
 52 EBI Report 2000, p. 9-33.

 53 In EPA’s The National Biannial RCRA Hazardous Waste Report, there is a very close

correspondence between the identities of the 50 largest hazardous waste generators and

hazardous waste managers. The list of 50 largest hazardous waste managers does not include

any of the three firms mentioned by EBI as the largest firms in hazardous waste management. 

None of these three firms had revenues exceeding $1 billion in 2001.

 54 EBI Report 2000 , pp. 11-11, 11-15.

 55 OECD Environmental Data 2000: Waste, pp. 17-18 and USITC calculation. A

corroborating piece of evidence with respect to nuclear waste, for which data may be better

than for other components of hazardous waste streams, is that total spent nuclear fuel arisings

in the OECD-25 by weight have declined by 15 percent from their peak in 1992 thru 2001

(Ibid., p. 27). A sharp drop in nuclear waste in the United Kingdom appears to account for

much of this decline.

2-13

that is disposed of in company-controlled facilities. The higher the percentage, the

more stable the firm’s operating environment.52

In the case of hazardous waste, internalization is most likely to take place between

the production and disposal of hazardous waste - that is, firms generating the waste

are likely to dispose of the waste on-site. This facilitates cost reduction by

motivating waste minimization and increasing opportunities for the recovery of the

productive value of waste chemical streams.53 

Corresponding with the increasing internalization of hazardous waste management

within the waste generating industries themselves is a decline in revenues generated

by the U.S. hazardous waste industry, which fell from about $6.5 billion in 1992 to

$2.7 billion in 2001 (not adjusting for inflation) and likely will continue to decline.54

International comparison data show a similar pattern, with the United States possibly

being ahead with regard to on-site management of hazardous waste and

corresponding reductions in total revenue generation. Using national definitions

(which are generally comparable over time if not across countries), total production

of hazardous waste in weight terms has declined 80 percent in the United States from

1995-99, and has declined over 50 percent from recent historic peaks in Mexico (71

percent reduction during 1997-2000), Korea (65 percent reduction during 1992-

2000), the Czech Republic (64 percent reduction during 1996-99), and Poland (69

percent reduction during 1996-2000). More modest declines from recent historic

peaks have occurred in Japan, Finland, Hungary, the Netherlands, Norway, the

Slovak Republic, Switzerland, and the United Kingdom.55 Production of hazardous

wastes may be on the increase in France, Germany, Italy, Russia, and some other

countries, though for certain countries a lack of recent data makes this unclear. Also,

there is significant volatility in year-to-year figures, which may result from changes

in definitions and/or enforcement. Nonetheless, the evidence is fairly strong in

support of a secular downward trend in the total amount of hazardous waste available

for processing throughout the developed world, and the amount that presents itself to

the market for processing by hazardous waste management firms.
 56 OECD Environmental Data 2002 - Wastes, pp. 17-19.

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International Transactions 

There are three types of international transactions pertaining to solid and hazardous

waste services recorded in U.S. data. These include:

• merchandise trade transactions, which record physical shipments of waste across

borders;

• services transactions on the current account, which record payments for waste

management services such as treatment or disposal; and

• sales by overseas affiliates of multinational firms providing waste treatment or

disposal services, both those arising from U.S. direct investment abroad and from

foreign direct investment in the United States.

In some instances, the treatment of a particular shipment of waste may involve more

than one of these activities. For example, waste may be shipped physically from

country A to country B, with the producer of waste in country A paying a firm in

country B to manage the waste. From the standpoint of country A, this would be

recorded as an export of waste as merchandise, and an import of services on the

services portion of the current account. Alternately, a producer of waste may ship

waste to another firm within its own country for management, with the waste

management firm being an affiliate of a foreign-owned firm. This transaction would

not be recorded either on the merchandise trade or services portions of the current

account. However, data reflecting the operations of the waste management firm will

appear in surveys of direct investment, and the waste management firm itself may

engage in related transactions which affect balance-of-payments data. These

examples may not exhaust the ways in which the treatment and disposal of solid and

hazardous waste can affect data on international transactions.

Only a small fraction of solid and hazardous waste crosses international borders. 

Data on international trade in solid wastes are spread across a number of different

categories, some of which are specific to the type of material being traded and some

of which do not always distinguish between material for final disposal and material

for recovery and reuse. Internationally traded hazardous wastes are declared by

manifest by many countries under the Basel Convention. The smaller the country,

the more likely that waste will be traded across international borders. Available

OECD data on hazardous wastes imply that for a number of countries, exports and/or

imports of hazardous wastes exceed 10 percent of local production of such wastes. 

These countries include Austria, Denmark, Ireland, Luxembourg, the Netherlands,

Sweden, and Switzerland. In most cases, countries engage in two-way trade in

hazardous wastes, although some countries tend to run a persistent surplus or deficit. 

Consistent net importers of hazardous waste (and thus, probable net exporters of

hazardous waste services) include Canada, Mexico, France, Spain, and the United

Kingdom. Consistent net exporters of hazardous waste (and thus, probable net

importers of hazardous waste services) include Austria, Denmark, Germany, Ireland,

Italy, Luxemborg, and Switzerland.56 The data in table 2-1 suggest that inernational

provision of waste-related services is much more likely to take place through FDIrelated activity of affiliates than through arms’ length trade in services. In some

cases, one country may physically ship wastes to another country, which then
2-15

Table 2-1

Selected indicators of U.S. international transactions in waste and waste services,

2001-2002 and Jan.-Sept. 2003

Type of trade/Product or industry definition

2001 

full year

2002

full year

2003 Jan.-

Sept.

—————Million dollars——————

Sales of affiliates associated with direct investment

Waste management and remediation services:

Foreign direct investment in the United States . . . 1,809 (2

) (2)

 U.S. direct investment abroad1 ............... 270 - 860

Trade in private services, unaffiliated

Waste treatment and depollution services:

U.S. exports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 20 (2)

U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 14 (2)

Merchandise trade of certain wastes

HS 38253:

U.S. exports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2) 4.2 4.5

U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (2

) 1.5 5.8

 1 USITC estimate based on the assumption that sales are proportionate to employment in this and

two other non-disclosed industries, taking the upper and lower bound estimates implied by the

reported ranges of employment and rounding to the nearest $10 million. The value is not reported to

avoid disclosure of data pertaining to individual firms.

 2

 Not available.

 3

 HS 3825 includes municipal waste, sewage sludge, clinical waste, residual products of the

chemical and allied industries and certain other wastes. Sewage sludge accounts for about 3 percent

of total U.S. trade in HS 3825.

Source: U.S. Department of Commerce and USITC calculations.

manages the wastes and receives payment for a service. This pattern may suggest

that imports of wastes are statistically associated with exports of waste-related

services and vice-versa. Such a pattern is not obviously confirmed by the data. The

fact that market values assigned to the physical wastes are apparently very low, and

moreover may differ markedly for different types of wastes, make such a pattern

more difficult to observe in the data if in fact it exists.

U.S. Data on International Transactions

U.S. international transactions relating to waste and waste services are of several

types, and pertain to:

• transactions of affiliates associated with direct investment (U.S. direct investment

abroad and foreign direct investment in the United States)
 57 Not elsewhere specified or included.

2-16

• unaffiliated (arms’ length) transactions in services

• merchandise trade in solid or hazardous waste itself, which may be transported

across borders for purposes of treatment. Exports of waste may be associated

with imports of waste treatment services and vice versa, though there may be

exceptions to this rule. 

Table 2-1 compares selected indicators pertaining to sales by affiliates, unaffiliated

trade in private services, and merchandise trade in waste. The definition of waste

services may not be identical for affiliated and unaffiliated services trade, and the

definition of waste traded as merchandise may not conform precisely to the

definitions employed elsewhere in the report. The trade classification HTS 3825 is

defined as “residual products of the chemical or allied industries, nesoi,57 municipal

wastes, sewage wastes, other wastes specified in note 6 to chapter 38.” In particular,

HTS 3825, as reported, does not include wastes associated with the petrochemicals

industry, which may be treated as hazardous waste but which may often be recycled. 

The 4-digit code may also exclude other relevant waste. 

From table 2-1 it is possible to infer that sales by affiliates associated with direct

investment in the waste management services industries are one or two orders of

magnitude larger than unaffiliated sales of such services (hundreds of millions or

billions of dollars annually as opposed to tens of millions of dollars). It also appears

likely that sales by affiliates of foreign-owned firms in the United States are several

times larger than sales by U.S.-owned affiliates abroad, even though the value of the

latter is uncertain owing to data disclosure issues. Finally, the values assigned to the

waste traded are very low (millions of dollars a year) as compared to the values of

services associated with waste treatment. Data for HS 3825 are not available prior to

2002.

Table 2-2 shows the country-by-country breakout of U.S. merchandise trade in

wastes captured by HS 3825. The largest share of U.S. trade (42 percent of the total)

is with Canada, in relation to which the United States is a net importer of waste,

suggesting that U.S. firms are providing waste management services to the Canadian

market. The United States is a net exporter of wastes under HS 3825 to other major

trading partners for the 21 months (January 2002-September 2003) for which data are

available. The most significant of these are the United Kingdom (15 percent of total

U.S. waste trade), China (6 percent) and El Salvador (5 percent). 

Table 2-3 presents the main types of waste traded under HS 3825. The largest share

of such trade comprises various chemical waste flows (HS 3825.49 through HS

3825.90), which may be either treated as hazardous wastes or recycled. The United

States is a heavy net exporter of chemical wastes in all categories except HS 3825.90,

a large and miscellaneous category in which trade is nearly balanced. Imports of

municipal waste, sewage sludge, clinical waste, and most categories of chemical

wastes are dominated by imports from Canada.
2-17

Table 2-2U.S. merchandise trade under HS 3825,1 Jan. 2002 - Sept. 2003

Exports Imports 

COUNTRY 2002 

Jan.-Sept.

2002

Jan.-Sept.

2003 2002

Jan.-Sept.

2002

Jan.-Sept.

2003

—————————————————————————Dollars————————————————

Canada . . . . . . . . . . . . . . . . . . . 43,065 38,222 146,245 1,302,898 844,038 5,197,947 United Kingdom ............ 524,948 66,592 1,745,697 13,238 13,238 98,581 China . . . . . . . . . . . . . . . . . . . . 797,691 722,727 132,094 17,972 17,972 54,779 El Salvador ................ 465,000 0 332,449 0 0 0 Brazil . . . . . . . . . . . . . . . . . . . . . 329,797 230,440 104,209 0 0 215,595 Mexico . . . . . . . . . . . . . . . . . . . 366,780 285,825 106,000 63,695 14,528 55,733 

Italy . . . . . . . . . . . . . . . . . . . . . . 8,637 8,637 378,792 0 0 0 Taiwan . . . . . . . . . . . . . . . . . . . 188,924 102,119 184,247 0 0 0 Haiti . . . . . . . . . . . . . . . . . . . . . 151,635 97,039 137,594 0 0 0 Netherlands . . . . . . . . . . . . . . . 32,839 32,839 138,628 0 0 94,975 Korea . . . . . . . . . . . . . . . . . . . . 221,865 217,822 16,517 6,110 6,110 0 Indonesia ................. 198,100 90,100 7,377 0 0 0 Dominican Republic . . . . . . . . . 74,485 36,162 108,413 0 0 0 Peru . . . . . . . . . . . . . . . . . . . . . 11,543 0 170,082 0 0 0 Other . . . . . . . . . . . . . . . . . . . . . 812,513 527,435 819,861 87,620 52,397 108,166 

Total . . . . . . . . . . . . . . 4,227,822 2,455,959 4,528,205 1,491,533 948,283 5,825,776 

1 HS 3825 is defined as “residual products of the chemical or allied industries, nesoi, municipal waste, sewage wastes, other wastes s

chapter 38.”Source: USITC Dataweb.
2-18

Table 2-3U.S. merchandise trade under HS 3825, Jan. 2002 - Sept. 2003, by subcategory HScategory Description

U.S.

domestic

exports Principal destinations

U.S. imports

for

consumption

Dollars Dollars

3825.10 Municipal waste 568,475 Mexico, Peru, Singapore, Australia, United

Kingdom

535,515 

3825.20 Sewage sludge 132,520 Korea, Mexico 53,035 3825.30 Clinical waste 19,259 Mexico, Netherlands 624,188 3825.49 Waste organic solvents, other than

halogenated

327,118 Jamaica, Sweden, South Africa, Taiwan,

Germany

31,253 

3825.50 Wastes of metal-pickling liquors,

hydraulic fluids, brake fluids andantifreeze fluids

2,294,920 China, Haiti, Dominican Republic, Ukraine,

Panama

0 

3825.61 Other wastes from the chemical and

allied industries, mainly containingorganic constituents

99,368 Italy, France, China, Canada 7,893 

3825.69 Other wastes from the chemical and

allied industries, other than thosemainly containing organicconstituents

142,685 Dominica, Dominican Republic, Argentina,

Taiwan, Germany, Canada

17,319 

3825.90 Residual products of the chemical

industries, nesoi, other wastesnesoi, specified in note 6 to chapter38

5,136,449 United Kingdom, El Salvador, Brazil, Italy,

Taiwan

6,048,306 

Total . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8,756,027 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7, 317,309Source: USITC Dataweb. "Principal destinations" and "principal suppliers" are those accounting for 5 percent or more of the total, in desceimportance.
 1

 Metric units generated by USITC staff calculation.

 2

 U.S. Environmental Protection Agency (EPA), Office of Solid Waste and Emergency

Response (OSW), Municipal Solid Waste in the United States: 2001 Facts and Figures,

EPA530-R-03-001, Oct. 2003. The EPA does not report data on total solid waste. EPA

estimates include data for containers and packaging; durable goods such as furniture,

appliances, and consumer electronics; nondurable goods such as newspapers and clothing; and

other wastes such as food scraps and yard trimmings. Solid wastes excluded from EPA data

on municipal solid waste include municipal sludge, industrial nonhazardous waste,

construction and demolition (C and D) debris, and agricultural, oil and gas, and mining

wastes. Industry estimates for solid waste generation, which include data for certain solid

waste excluded from EPA data on MSW, exceeded 363 million metric tons in 2001,

considerably higher than EPA’s estimates for MSW and based on methodologies substantially

different from the one developed by EPA.

 3

 Expressed in pounds per person per day, generation totaled 4.5 in 1990 and 4.4 in 2001. 

EPA, OSW, Municipal Solid Waste in the United States: 2001 Facts and Figures.

3-1

CHAPTER 3

UNITED STATES

Introduction

As the world’s largest market for waste management services, the U.S. market is

mature, competitive, and highly regulated. In recent years, no major regulations or

legislation affecting waste management services have emerged to stimulate new

growth in the market, and thus, the U.S. market for waste management services is in

the process of consolidating. The United States has recently become a net importer

of solid and hazardous waste services, owing to efforts by leading U.S. firms to focus

on domestic businesses. Although nearly all U.S. solid waste management firms

operate only in the domestic market, one of the leading U.S. solid waste management

firms has a leading market position in Canada. Moreover, a few U.S. hazardous

waste management firms provide services in Canada and Mexico.

This chapter presents an overview of the U.S. market’s size, key suppliers and

consumers, principal technologies, and regulation; addresses the nature and extent of

U.S. trade and investment in the industry; and discusses the future outlook for the

U.S. market for waste management services.

Market Overview

The United States generated about 208 million metric tons1 of municipal solid waste

(MSW) in 2001 (table 3-1),2

 reflecting a decrease of about 3 million metric tons, or 1

percent, below the previous year, and an increase of 22 million metric tons over

1990. Municipal solid waste generation per capita has remained relatively stable

since 1990 but decreased 5 percent during 1999-2001.3

 The EPA estimates that
3-2

Table 3-1

Selected characteristics of the U.S. solid and hazardous waste services market

Item Solid waste Hazardous waste

Waste

generation/treatment

The United States generated 208

million metric tons of municipal

solid waste (MSW)1 in 2001,

virtually all of which was managed.2

The United States generated 36

million metric tons3

 of RCRA

hazardous waste in 1999, virtually

all of which was managed.4

Waste prevented or

reduced at source

50 million metric tons in 2000,

which reduced the solid waste

stream by 19 percent.2, 5

(

6

)

Market size (2002) $42.8 billion; 11,200 firms.7 $4.9 billion; 1,200 firms.7

Employment (2002) 276,000 employees.7 38,300 employees.7

Trade (2002) Exports- $503 million; imports- $1.3

billion.7

Exports- $95 million; imports- $220

million.7

Nature of industry Highly consolidated, with the top 3

firms accounting for almost 50

percent of industry revenues. 

Publicly traded companies and

private companies together

account for 69 percent of the

market, while government

municipalities account for the

remaining 31 percent of the

market.7

Highly consolidated, especially in

the medical waste industry.7

Key market participants

(and location of parent)

Waste Management (U.S.); Allied

Waste (U.S.); Republic Services

(U.S.); Onyx (France). 7, 8, 9

Clean Harbors, Inc. (U.S.); Onyx

(France); Philip Services (U.S.);

Medical waste-Stericycle (U.S.).7, 9

Principal methods of

waste treatment and

disposal

Landfills account for the largest

share of solid waste disposal in the

United States (55 percent in 2001),

followed by recycling (including

composting)(30 percent) and

incineration (15 percent).2

Land disposal (69 percent)

principally by deepwell/underground injection, thermal

treatment (11 percent), recovery

operations (8 percent), and other

methods (11 percent).2, 10

Key legislation Solid Waste Disposal Act (SWDA);

Resource Conservation and

Recovery Act (RCRA); Pollution

Prevention Act (PPA).11

Resource Conservation and

Recovery Act (RCRA);

Comprehensive Environmental

Response, Compensation, and

Liability Act (CERCLA).12

Regulatory authorities Environmental Protection Agency (EPA); state and local level

environmental agencies.13

See footnotes at end of table.
3-3

Table 3-1—continued

Selected characteristics of the U.S. solid and hazardous waste services market

Item Solid waste Hazardous waste

GATS commitments U.S. commitments grant full market access and national treatment for the

provision of refuse disposal services through cross-border supply (mode

1), consumption abroad (mode 2), and commercial presence (mode 3). 

However, these commitments only apply to a specified set of

environmental activities, and are limited to services contracted by private

industry.14

Other measures affecting

trade and investment

OECD decisions on the control of

transboundary movement of

wastes destined for recovery

operations.15 Bilateral Agreement

governs transboundary movement

of solid waste concerning recycling

with Canada.16

OECD decisions on the control of

transboundary movement of wastes

destined for recovery operations.15

Bilateral agreements govern

transboundary movement of

hazardous waste concerning

recycling and disposal with Canada

and recycling with Mexico.16, 17

 1 Total does not include municipal sludges; industrial nonhazardous wastes; construction and demolition

debris; and agricultural, oil and gas, and mining wastes. Industry estimates for solid waste generation,

which include data for municipal solid waste as well as certain solid waste excluded from EPA data,

exceeded 363 million metric tons in 2001. These industry estimates were generated using methods that

are substantially different from the one developed by EPA.

 2

 U.S. Environmental Protection Agency (EPA), Office of Solid Waste and Emergency Response

(OSW), Municipal Solid Waste in the United States: 2001 Facts and Figures, report No. EPA530-R-03-001,

Oct. 2003.

 3

 Data shown for generation are reported by large quantity generators (LQGs) as defined under the

Resource Conservation and Recovery Act (RCRA). Industry sources estimate that LQGs represent

approximately 60 percent of total hazardous waste generated in the United States.

 4 EPA, OSW, The National Biennial RCRA Hazardous Waste Report: Based on 1999 Data, June 2001.

 5

 Solid Waste Association of North America.

 6

 Not available.

 7

 Environmental Business International, Inc. (EBI), Environmental Business Journal, vol. xvi, No. 5/6,

2003, p. 5; EBI, e-mail messages to Commission staff, received Jan. 22, 2004.

 8

 Standard & Poor’s, Industry Surveys: Environment and Waste Management, Apr. 24, 2003.

 9

 Corporate annual 10-K reports.

 10 Applies to treatment and disposal of RCRA hazardous waste reported by LQGs in 1999.

 11 SWDA (1965): 42 U.S.C. 6991 et seq.; RCRA (1976): 42 U.S.C. 321 et seq.; and PPA (1990): 42

U.S.C. 13101 and 13102 et seq.

 12 RCRA (1976): 42 U.S.C. 321 et seq.; CERCLA (1980): 42 U.S.C. 9601 et seq.

 13 U.S. EPA, established in 1970, states that it develops and enforces regulations to implement federal

and environmental laws, and conducts and sponsors research, environmental education, and programs to

encourage pollution reduction and energy conservation, as indicated at the EPA website,

http://www.epa.gov/. Information on state and local government environmental agencies may be found at

websites maintained by states, counties, and municipalities individually. 

 14 General Agreement on Trade in Services (GATS), United States: Schedule of Specific Commitments,

GATS/SC/90, Apr. 1994.

 15 OECD, Decision C(92)/39/final, revised May 2002.

 16 Agreement Between the Government of the United States of America and the Government of Canada

Concerning the Transboundary Movement of Hazardous Waste, Oct. 28, 1986, as amended in 1992. By

an exchange of letters, the amendment in 1992 extended the agreement to include solid waste.

 17 Annex III to the Agreement Between the United States of America and the United Mexican States on

Cooperation for the Protection and Improvement of the Environment in the Border Area: Agreement of

Cooperation Between the United States of America and the United Mexican States Regarding the

Transboundary Shipments of Hazardous Wastes and Hazardous Substances (“La Paz Agreement”), Nov.

12, 1986.
 4

 Environmental Business International, Inc. (EBI), Environmental Business Journal vol.

XVI, No. 5/6, 2003, p. 5; and EBI, e-mail messages to USITC staff, received Jan. 22, 2004.

 5

 Calculated by USITC staff based on EBI sources, e-mail messages to USITC staff,

received Jan. 22, 2004.

 6

 EBI, The U.S. Environmental Industry & Global Market, p. 9-30.

 7

 Corporations’ annual reports on Form 10-K to the SEC and profiles by Datamonitor,

found at Internet address http://www.ebsco.com/, retrieved Jan. 6, 2004.

 8

 Standard & Poor’s, Industry Surveys: Environmental and Waste Management, Apr. 24,

2003.

 9

 An LQG is defined under U.S. law in the Resource Conservation and Recovery Act of

1976 (RCRA) as a generator that exceeds certain specified generation levels of RCRAclassified hazardous waste in a single month or accumulated at any time. 

 10 EPA, OSW, The National Biennial RCRA Hazardous Waste Report (Based on 1999

Data), Executive Summary, EPA530-S-01-001, June 2001. Data reported for 1997 and 1999

are not comparable to data reported prior to 1997. 

 11 Industry representative, e-mail response to USITC staff, Dec. 16, 2003.

3-4

residential consumers generate 55 percent to 65 percent of municipal solid waste,

with nonresidential consumers contributing the remainder.

The United States is the world’s largest market for solid waste management services,

including MSW and other nonhazardous waste, with revenues totaling $42.8 billion

and employment estimated at 276,000 in 2002.4

 During 1990-2002, revenues

increased at an average annual rate of 4 percent.5

 Approximately 11,200 companies

supplied solid waste management services to industrial and municipal consumers in

the United States in 2002. In 2001, private and publicly-traded companies accounted

for 69 percent of industry revenues, while government-affiliated entities accounted

for the remaining 31 percent of such revenues. Despite the large number of service

providers, the U.S. market for solid waste management services is highly

consolidated. The three largest firms in terms of revenue– Waste Management, Inc.

(WMI), Allied Waste Industries, and Republic Services- all of which are U.S.-owned,

accounted for approximately 47 percent of total U.S. solid waste management

revenues in 2001.6

 These firms have vast collection, transportation, transfer,

recycling, and disposal operations throughout the United States, with each firm’s

revenues exceeding $2 billion in 2002.7

 Other waste services firms operate in smaller

geographic areas or provide fewer services, and their revenues are considerably lower

than the three market leaders. The rapid pace of mergers and acquisitions among

solid waste services firms in the 1990s has slowed in recent years, as leading national

and regional firms have sought instead to improve operating efficiency, constrain

costs, and purchase certain strategic assets from one another to improve their position

in the price-sensitive U.S. market.8

Approximately 20,000 large quantity generators (LQGs)9 in the United States

produced a total of 36 million metric tons of hazardous waste in 1999,10 accounting

for about 60 percent of all hazardous waste generated domestically.11 Whether this

represented an increase or decrease over previous levels is not clear due to the EPA’s

recent reclassification of certain hazardous waste as “special waste.”
 12 Industry representative, telephone interview by USITC staff, Oct. 29, 2003.

 13 Calculated by USITC staff based on EBI sources, e-mail messages to USITC staff, Jan.

22, 2004.

 14 Environmental Business International, Inc. (EBI), Environmental Business Journal vol.

XVI, No. 5/6, 2003, p. 5; and EBI, e-mail messages to USITC staff, received Jan. 22, 2004.

 15 EBI, The U.S. Environmental Industry & Global Market, p. 11-1.

 16 Clean Harbors, Inc., annual report on Form 10-K, fiscal year ended Dec. 31, 2002.

 17 Ibid.

 18 Ibid.; and EBI, The U.S. Environmental Industry & Global Market, p. 11-3.

 19 Clean Harbors, Inc., annual report on Form 10-K.

 20 Industry analysts generally classify and estimate revenues for the medical waste

management services segment as part of the hazardous waste services industry. States usually

regulate medical waste as a solid or “special” waste rather than as a hazardous waste under the

RCRA, although definitions and requirements vary among the states.

 21 Stericycle, Inc., annual report on Form 10-K, fiscal year ended Dec. 31, 2002, found at

Internet address http://www.sec.gov/; “Stericycle Upped Medical Waste Operating Margins,

Analyst Notes,” Milwaukee Journal Sentinel, Oct. 26, 2002, at Internet address

http://www.jsonline.com/, retrieved Aug. 22, 2003; and EBI, “$400-Million Stericycle

Continues Acquisition Campaign Into 2002,” Environmental Business Journal, vol. 14, No.

7/8, 2002.

 22 “Embattled Med/Waste Files for Bankruptcy,” Waste News, Feb. 18, 2002; and EPA,

final report on removal actions at the former Med/Waste Inc. incinerator facility in Hampton,

SC, Jan. 2003.

3-5

The United States is likely the world’s largest single-country market for hazardous

waste management services,12 with market revenues of $4.9 billion in 2002. During

1990-2002, market revenues decreased at an average annual rate of 2 percent.13 The

U.S. industry for such services comprised approximately 1,200 firms and 38,300

workers in 2002.14 The number of firms has decreased in recent years, as factors

such as excess capacity, high capital costs, corporate debt, price, competition, and

low profit margins have encouraged merger and acquisition activity among leading

firms.15 In September 2002, Clean Harbors, Inc. (U.S.) acquired Safety-Kleen

Corp.’s (U.S.) chemical services business, nearly doubling Clean Harbors’ annual

revenues to more than $600 million16 and established the firm as the largest operator

of hazardous waste treatment facilities in North America. As of December 2002,

Clean Harbors had hazardous waste management properties located in 36 U.S. states,

Canada, Mexico, and Puerto Rico.17 Other leading firms providing hazardous waste

services in the U.S. market include Onyx (France), Safety-Kleen, Heritage (U.S.),

Philip Services (U.S.), Teris (subsidiary of French firm Suez), and WMI.18 Principal

consumers of hazardous waste services include utilities; chemical, petroleum,

pharmaceutical, and other industrial generators of large quantities of hazardous

waste; educational institutions; medical and health care providers; other

environmental service entities; and government agencies.19 

The U.S. medical waste management services industry, considered a segment of the

U.S. hazardous waste industry,20 earned revenues exceeding $1.5 billion in 2002. 

Stericycle, Inc. (U.S.) accounted for approximately 25 percent of this industry’s

revenues in 2002,21 while its largest competitor filed for bankruptcy and ceased

operations in the same year.22 After completing 66 acquisitions during 1993-2002,

Stericycle reported having the only fully integrated, national medical waste

management network in the United States, serving more than 5,000 large medical

waste generators, such as hospitals and pharmaceutical manufacturers, and

approximately 285,000 small medical waste generators, such as outpatient clinics and
 23 Stericycle, Inc., annual report on Form 10-K.

 24 EBI, The U.S. Environmental Industry & Global Market, p. 11-34.

 25 Solid Waste Association of North America (SWANA), “Pushing the Envelope on Waste

Reduction and Recovery,” Jan. 30, 2003, found at Internet address

http://www.swana.org/WhyPolicy.asp/, retrived July 12, 2003.

 26 EPA, OSW, Municipal Solid Waste in the United States: 2001 Facts and Figures. 

 27 EBI, The U.S. Environmental Industry & Global Market, ch. 9.

 28 EPA, OSW, Municipal Solid Waste in the United States: 2001 Facts and Figures.

 29 EBI, The U.S. Environmental Industry & Global Market, p. 9-4.

 30 EPA, OSW, Municipal Solid Waste in the United States: 2001 Facts and Figures.

 31 SWANA, “Pushing the Envelope on Waste Reduction and Recovery.”

 32 EPA, OSW, Municipal Solid Waste in the United States: 2001 Facts and Figures. 

3-6

medical and dental practitioners’ offices.23 The $500-million U.S. market for lowlevel radioactive waste management, another segment of the U.S. hazardous waste

services market, is served by only a small number of approved disposal sites.24 A 12-

fold increase in disposal costs for low-level radioactive waste during 1986-96 has led

generators to sharply reduce their production of such waste.

The majority of the U.S. solid waste stream is managed at waste disposal facilities,

although the share of the waste stream sent to such facilities has decreased from 90

percent in 1980 to 70 percent in 2001 in light of ambitious recycling programs. 

Landfilling is the most prevalent method of disposal, having accounted for 56 percent

of municipal solid waste management, by weight, in 2001. In that year, 116 million

metric tons of municipal solid waste was disposed in landfills, about 9 percent less

than in 1990.25 The number of municipal solid waste landfills has decreased

substantially, from about 8,000 in 1988 to 1,858 in 2001. At the same time, the

average size of landfills and the number of waste transfer stations have grown,26 as

increasingly rigorous federal environmental standards beginning in 1989 led landfill

owners either to upgrade operations with more costly technologies and expand

landfill size to achieve greater economies of scale, or to cease operations.27 The

southeast and western regions host the greatest number of municipal solid waste

landfills, owing to more affordable and available land. In 29 U.S. states, landfill

capacity is considered adequate for more than 10 years,28 although Pennsylvania, the

state that imports the most waste from outside its borders, is among the states that

may soon face a shortfall in capacity.29

Waste-to-energy (WTE) facilities disposed of about 15 percent of the U.S. municipal

solid waste stream in 2001. Despite the high capital costs associated with the

construction of such facilities, 97 WTE facilities were operating in the United States

in 2001.30 Many of these facilities are located in the northeastern United States

where land is relatively limited and expensive. In 2001, WTE facilities processed 31

million metric tons of solid waste, approximately equal to the previous year when

industry data indicated such facilities generated 2,800 megawatts of renewable

energy, equivalent to providing energy to 2.4 million homes.31

Recycling programs recovered an estimated 62 million metric tons of material from

the U.S. municipal solid waste stream in 2001, accounting for about 30 percent of the

waste stream, up from 16 percent in 1990, and 10 percent in 1980.32 By weight, the

leading materials recovered in 2001 included paper and paperboard (34 million

metric tons, or 54 percent of all recycled municipal solid waste), yard trimmings (15

million metric tons, or 23 percent), metals, especially steel (5 million metric tons, or
 33 Standard & Poor’s, Industry Surveys: Environment and Waste Management, Apr. 24,

2003.

 34 Ibid.

 35 EPA, “Managing C & D Debris,” found at Internet address

http://www.epa.gov/epaoswer/non-hw/debris/manage.htm/, retrieved Dec. 15, 2003. 

Construction and demolition waste is not included in data on municipal solid waste reported

by EPA. 

 36 Standard & Poor’s, Industry Surveys: Environmental and Waste Management, Apr. 24,

2003.

 37 EPA, OSW, Municipal Solid Waste in the United States: 2001 Facts and Figures; and

SWANA, “Pushing the Envelope on Waste Reduction and Recovery.” 

 38 Environmental Industry Association, facsimile to the Commission, Sept. 9, 2003.

3-7

9 percent), glass (2 million metric tons, or 4 percent), and plastics, textiles, wood,

rubber and leather, other materials, and food and other wastes (about 1 million each,

comprising the remaining 10 percent). Recycling rates for the two highest generated

waste materials – paper and paperboard, and yard trimmings – amounted to 45

percent and 57 percent, respectively, in 2001. The largest amount of recovered

materials, by weight, comes from commercial establishments. Growth in municipal

recycling has slowed since the mid-1990s, as recycling costs exceeded disposal costs,

and sales of recycled materials were not sufficient to cover the difference.33 In 2001,

9,704 curbside recycling programs and 3,846 yard-trimming composting programs

operated in the United States, as the incidence of these programs grew by 5 percent

and 1 percent, respectively, in that year. Recyclable materials are sorted and

processed at about 540 facilities nationwide, including 480 materials recovery

facilities (MRFs), 43 mixed waste processing facilities, and 16 mixed waste

composting facilities.

Construction and demolition waste, which reportedly accounts for 15 to 30 percent of

the U.S. solid waste stream,34 is typically managed through depositing the debris in

municipal solid waste landfills or landfills devoted specifically to construction and

demolition waste.35 Diversion of construction and demolition waste from disposal

facilities is considered a particularly important strategy for municipalities and

recycling businesses, as these waste materials have established end-use markets and

cost less to recycle than to transport to landfills.36

In 1990, in response to rising generation of solid waste, federal legislation was passed

that made waste reduction at the source the top priority of U.S. waste management

policy. Source reduction methods include changing the design or composition of

products or packaging so as to reduce the quantity of materials used or to facilitate

reuse, lengthening a product’s useful life, providing packaging that reduces spoilage

or damage, and managing food scraps or yard waste through on-site composting or

other alternative disposal methods. Through such waste prevention efforts, 50

million metric tons of municipal solid waste were prevented from entering the U.S.

waste stream in 2000, resulting in a waste stream that was 19 percent smaller than it

would have been in the absence of such efforts.37

As relatively little solid waste travels far for treatment or disposal, most waste

management services activity occurs within state borders. However, transportation of

solid waste across state borders, chiefly to other U.S. states, is growing, as 47 states

exported some solid waste in 2000, up from 13 states in 1989.38 Where shipments of

solid waste cross state lines in the United States, industry sources report that
 39 Industry representative, e-mail response to USITC staff, Dec. 16, 2003.

 40 EPA, OSW, The National Biennial RCRA Hazardous Waste Report (Based on 1999

Data), Executive Summary.

 41 Katherine N. Probst and Thomas C. Beierle, The Evolution of Hazardous Waste

Programs: Lessons from Eight Countries (Washington, DC: Resources for the Future, June

1999), p. 67.

 42 EPA, OSW, The National Biennial RCRA Hazardous Waste Report (Based on 1999

Data).

 43 Texas (22 percent), Louisiana (16 percent), Florida (11 percent), Kansas (9 percent), and

Ohio (6 percent).

 44 Stericycle, Inc., annual report on Form 10-K.

 45 Ibid.

 46 EPA, “Section 1: Introduction to the Resource Conservation and Recovery Act,” found at

Internet address http://www.epa.gov/epaoswer/general/orientat/rom1.pdf/, retrieved May 8,

2003.

3-8

differences in terms of waste management standards and classification of specific

wastes may create challenges and increase operating costs for waste management

firms.39

In 1999, 1,575 EPA-permitted treatment, storage, or disposal (TSD) facilities

reported managing 24 million metric tons of hazardous waste.40 Because most of the

hazardous waste TSD infrastructure in the United States existed prior to the

restrictions on such facilities instituted under the Resource Conservation and

Recovery Act (RCRA) and liability for site contamination under the Comprehensive

Environmental Response, Compensation, and Liability Act (CERCLA), many TSD

facility closures have occurred in recent years.41 In 1999, 69 percent of managed

hazardous waste was subjected to land disposal, principally through deep-well or

underground injection (61 percent) and also through disposal in dedicated landfills (5

percent) and surface impoundment (3 percent).42 About 11 percent of managed

hazardous waste was thermally treated in incinerators with or without energy

recovery. Recovery operations accounted for 8 percent of managed hazardous waste,

concentrated chiefly in fuel blending (4 percent) and metals recovery for reuse (3

percent). The remaining 11 percent was managed through stabilization processes or

other means. Five U.S. states43 managed 64 percent of the country’s hazardous waste

in 1999.

With regard to medical waste, treatment and disposal operations include incineration,

autoclaving, and other technologies that employ grinding and heating waste.44

Changes in regulations in 1997 have prompted the closure of numerous on-site

hazardous waste incinerators, as many owners or operators have decided not to

undertake the increased costs of regulatory compliance. Further, certain off-site

incinerators have closed in recent years as waste management firms have increased

the use of waste minimization, separation of various hazardous and nonhazardous

waste materials, and non-incineration treatment and disposal options for certain

hazardous waste.45

In the United States, responsibility for public oversight of solid waste management,

including functions such as primary planning, regulation, and enforcement, resides at

the state and local government levels.46 The Federal Government provides state and

local agencies with information and other assistance, such as federal criteria for

designing municipal solid waste landfills and other solid waste disposal facilities,
 47 42 U.S.C. 6901 et seq.

 48 The RCRA identified and defined four classes of hazardous waste based on the

ignitability, reactivity, corrosiveness, and toxicity of certain substances, and lists of hazardous

wastes have been published and continue to be revised under the legislation. RCRA allows

only EPA-permitted facilities to accept designated wastes for authorized treatment, storage, or

disposal. Under the RCRA, EPA reviews state hazardous waste programs and grants

authority to states to implement their own programs in lieu of the federal program, provided

that these state programs are at least as stringent as the federal program. In practice, states

may impose more stringent requirements than are provided for in federal legislation and

regulations. EPA, OSW, Introduction to the Resource Conservation and Recovery Act.

 49 EPA, OSW, Introduction to the Resource Conservation and Recovery Act.

 50 More specifically, the 1984 amendments instructed EPA to develop certain regulations,

providing for automatic implementation if EPA had not yet issued subject regulations in

accordance with specified timetables. These amendments were adopted in response to

concerns over the safety of existing methods of hazardous waste disposal.

 51 42 U.S.C. 9601 et seq.

 52 EPA, CERCLA Overview, found at Internet address

http://www.epa.gov/superfund/action/law/cercla.htm/, retrieved May 8, 2003.

3-9

which many states adopt through state legislation. For authority over hazardous

waste management, federal laws and regulations set basic requirements for the states

to implement, although states may enact more stringent criteria. New or more

rigorous environmental regulation and enforcement are regarded as drivers of

environmental services demand, and major catalysts for defining new markets. 

Federal waste management legislation had its genesis in the 1960s, but the evolution

of the current U.S. waste services industry resulted from the enactment of the

RCRA47 in 1976. The RCRA established three interrelated programs: Subtitle C, the

hazardous waste program, established a system to control such waste from generation

until final disposal;48 Subtitle D, the solid waste program, encouraged states to

institute comprehensive plans to manage nonhazardous industrial and municipal solid

waste, established criteria for municipal solid waste landfills and other solid waste

disposal facilities, and prohibited unregulated dumping of solid waste; and Subtitle I,

the underground storage tank program, regulated tanks that store hazardous and

petroleum products.49 The RCRA has been amended several times: in 1984, to

establish the reduction or elimination of hazardous waste as a priority and to expand

the scope and requirements of the RCRA;50 in 1992, to strengthen EPA’s authority to

enforce the RCRA at federally owned facilities; and in 1996, to provide regulatory

flexibility for land disposal of certain wastes.

Numerous other federal laws—including transportation security laws, clean air and

clean water legislation, occupational safety and health legislation, and waste-specific

laws and regulations other than the RCRA—have an impact on the waste services

industry, especially in the hazardous waste services segment. For example, under the

CERCLA,51 also known as Superfund,52 generators and transporters of hazardous

substances, including waste, along with past and present owners and operators of

sites where a release of such substances has occurred, are made strictly, jointly, and

severally liable for cleanup costs resulting from releases or threatened releases of

CERCLA-regulated hazardous substances. Mixed waste that has both hazardous and

radioactive components are jointly regulated by EPA, the Department of Energy, and

the Nuclear Regulatory Commission, in accordance with the RCRA and the Atomic
 53 EPA, “Frequently Asked Questions on Mixed Waste,” Feb. 1, 1997, found at Internet

address http://yosemite.epa.gov/osw/rcra.nsf/, retrieved Oct. 10, 2003.

 54 EBI, The U.S. Environmental Industry & Global Market, p. 11-34.

 55 42 U.S.C. 13101 and 13102, et seq. (P.L. 101-505, Title VI, Subtitle F, Sections 6601-

6610).

 56 Industry representatives, e-mail response to USITC staff, Dec. 16, 2003, and interviews

by USITC staff, Washington, DC, Sept. 9 and Nov. 12, 2003. 

 57 Moreover, no statutory authority under the RCRA provides for notice and consent of

municipal solid waste imports and exports. EPA, OSW, correspondence to the Honorable

Debbie Stabenow, U.S. Senate, Aug. 26, 2003.

 58 EBI, e-mail sent to USITC staff, Jan. 22, 2004.

 59 Calculated by USITC staff based on various EBI sources.

 60 Ibid.

 61 U.S. Department of Commerce (USDOC), Bureau of Economic Analysis (BEA), U.S.

Direct Investment Abroad, table III.A2, “Selected Data for Foreign Affiliates and U.S. Parents

in All Industries,” preliminary 2000. These data are the first U.S. outbound FDI estimates to

be reported separately for waste management and remediation services.

3-10

Energy Act.53 Moreover, low-level radioactive waste has additional limitations with

respect to the movement of such waste.54 The Pollution Prevention Act (PPA) of

1990,55 while not exclusively devoted to waste services, is a federal law establishing

a national policy hierarchy that puts top priority on pollution prevention at the source

where feasible, followed by recycling, treatment, and safe disposal. The PPA tasked

the EPA with several responsibilities meant to encourage the development of

pollution prevention technologies and programs. However, industry sources report

that in recent years, regulation relating to solid and hazardous waste management has

reportedly eased rather than strengthened.56

Trade and Investment

The U.S. Government does not publish discrete data on trade in waste management

services.57 However, industry trade data -- which reflect both cross-border trade and

repatriated earnings from affiliate operations -- estimate that U.S. exports of solid

waste management services totaled $503 million in 2002, while U.S. imports of such

services totaled $1.3 billion.58 The estimated $827-million trade deficit in solid waste

services was, in part, a result of the increasing amount of U.S. waste shipped abroad,

and the substantial U.S. market presence of foreign-owned firms. During 1994-2002,

U.S. exports of solid waste services decreased by 6 percent per year, on average,

while imports increased at an average annual rate of 16 percent.59 Industry sources

estimate that U.S. imports of hazardous waste management services totaled $220

million in 2002, while exports of such services amounted to $95 million, resulting in

a $125-million deficit. During 1994-2002, U.S. exports of hazardous waste services

decreased at a 9-percent average annual rate, although imports increased at the rate of

10 percent per year.60

Official U.S. Government data on U.S. foreign direct investment (FDI) abroad

indicate that five foreign-based waste management and remediation affiliates of U.S.

firms held $3 billion in assets and reported $1.1 billion in sales in 2000.61 These

affiliates chiefly supply solid and hazardous waste management services in North

America and Puerto Rico. Leading U.S. participants in foreign markets include
 62 Clean Harbors derived about 91 percent of total revenue from customers in the United

States and Puerto Rico, and 9 percent from customers in Canada in 2002. The firm owns

incineration facilities in Quebec and Ontario designed primarily for the destruction of liquid

organic waste, and operates two commercial hazardous waste landfills in Canada. 

Additionally, the firm operates in Mexico. Clean Harbors, Inc., annual report on Form 10-K.

 63 Stericycle serves customers through collection and treatment facilities in the United

States, Puerto Rico, Canada, and Mexico. In addition, the firm has license agreements and

joint ventures to market its technology and expertise in Asia, Africa, and South America. 

Stericycle, Inc., annual report on Form 10-K.

 64 Industry representative, e-mail response to USITC staff, Dec. 16, 2003.

 65 Corporate annual reports.

 66 Industry representatives, interviews with USITC staff, Washington, DC, Sept. 9 and Nov.

12, 2003.

 67 Industry representative, interview by USITC staff, Paris, France, Nov. 3, 2003.

 68 USDOC, BEA, Foreign Direct Investment in the United States, table A-1, “Selected

Financial and Operating Data of Affiliates, by Industry of Affiliate,” revised 2000.

 69 USDOC, BEA, Foreign Direct Investment in the United States, table A-1, “Selected

Financial and Operating Data of Affiliates, by Industry of Affiliate,” revised 1998 and 1999.

3-11

WMI, Clean Harbors,62 and Stericycle.63 In addition to its leading position in terms

of revenues in the U.S. solid waste management services market, WMI is the leading

solid waste management firm operating in Canada. Until recently, WMI provided

waste management services in several European markets, but the company sold these

operations reportedly for financial and strategic reasons.64 Casella Waste Systems,

Inc. (U.S.) also provides solid waste management services in parts of Canada. In

general, U.S. firms providing services related to, but not classified as, waste

management services are more active participants in foreign markets than are U.S.

waste management firms. Examples include environmental consulting and

engineering firms, such as Bechtel, URS, Washington Group, and CH2M Hill.65 U.S.

firms that have reduced operations in foreign markets, or exited these markets

entirely, indicate that the slow adoption of environmental regulations and the failure

of certain regulatory entities in foreign countries to implement and enforce existing

environmental measures raised risks of liability and other financial considerations to

unacceptable levels.66

Key foreign participants in the U.S. market include French-owned affiliates Onyx (a

subsidiary of Veolia Environnement) and Teris (a subsidiary of Suez). Onyx is the

largest foreign-owned firm providing solid waste services in the U.S. market, with

U.S. revenues totaling less than $500 million in 2001. Teris operates treatment,

storage, and disposal facilities in Arkansas and California, and provides on-site

project management services and transportation services for hazardous and special

wastes throughout the United States.67 Official U.S. Government data indicate that a

total of six U.S.-based waste management and remediation affiliates of foreignowned firms held $4.8 billion in assets and reported $1.8 billion in sales in 2000.68

This represents a substantial decrease from 1998, when nine affiliates held $6.3

billion in assets and reported $3.5 billion in sales.69

There are no known measures that are imposed specifically on foreign providers of

waste management services in the United States or on foreign investment in the U.S.

waste services industry. Certain professionals that provide services incidental to

waste management, such as engineers, are subject to licensing provisions that vary by

state, such as requirements for citizenship or residency. Moreover, Michigan

requires contractors that provide construction and related services– another service
 70 State of Michigan, Department of Environmental Quality, Waste and Hazardous

Materials Division, “Report of Solid Waste Landfilled in Michigan: October 1, 2001 -

September 30, 2002,” Feb. 28, 2003, found at Internet address http://www.michigan.gov/deq/,

retrieved Sept. 17, 2003. 

 71 In January 2003, the City of Toronto began exporting all solid waste earmarked for a

landfill, up from approximately 60 percent in the previous year, to a commercial landfill in

Michigan, costing Toronto about $26 million per year. E & E Publishing LLC, “Interstate

Waste: Michigan Lawmakers to Consider Cap on Imported Trash,” Greenwire, Dec. 3, 2003,

found at Internet address http://www.eenews.net/greenwire/, retrieved Dec. 3, 2003.

 72 State of Michigan, Department of Environmental Quality, Waste Management Division,

“Report of the Michigan Solid Waste Importation Task Force to Governor John Engler and

Department of Environmental Quality Director Russell J. Harding,” Nov. 22, 2000, found at

Internet address http://www.michigan.gov/deq/.

 73 Environmental Industry Association, facsimile to the Commission, Sept. 9, 2003; and

State of Michigan, Department of Environmental Quality, “Report of the Michigan Solid

Waste Importation Task Force,” Nov. 22, 2000.

 74 State of Michigan, Department of Environmental Quality, “2002 Michigan DEQ

Environmental Quality Report,” found at Internet address http://www.michigan.gov/deq/,

retrieved Sept. 17, 2003.

 75 Texas Center for Policy Studies, “The Generation and Management of Hazardous Wastes

and Transboundary Hazardous Waste Shipments between Mexico, Canada and the United

States, 1990-2000,” May 2001, p. 64.

3-12

that is frequently provided in conjunction with waste management– to maintain an

office in the state.

The United States trades only a minimal amount of waste with foreign countries;

however, Michigan is an exception, engaging in a substantial amount of such trade. 

Canada was the state’s largest export market for solid waste management services in

2002, surpassing exports to other U.S. states for the first time. Canadian solid waste

as a share of total solid waste disposed of in Michigan landfills increased from 5

percent in 1999 to 12 percent in 2002, as the amount of waste sent to Michigan

landfills from Canada increased by 282 percent during 1999-2002.70 Although

shipments of solid waste into Michigan for disposal may have been considered

manageable in the short term, state environmental regulators have expressed concern

that continued significant increases in waste shipments from Canada71 could

adversely affect state budget allocations for source reduction and recycling

programs.72 To date, U.S. courts have ruled that laws enacted in Michigan and other

states that impose restrictions on imports of wastes from other countries and states

are unconstitutional, absent the U.S. Congress enacting legislation specifically

granting the authority to restrict such trade.73 As regards hazardous waste, Michigan

is a net exporter of such waste transported to Canada, and thus may be a net importer

of hazardous waste management services.74 U.S. shipments of hazardous wastes to

Ontario and Quebec reportedly have increased significantly in recent years,

reportedly due to relatively less stringent regulatory standards in effect in the

provinces at that time and expanding provincial disposal capacity.75 The United

States and Canada generally permit hazardous waste shipments across each other’s

borders for appropriate treatment, recycling, and disposal. However, hazardous

waste containing certain substances above legally permissible thresholds are

exceptions. For example, owing to the potential adverse health effects of exposure to
 76 EPA, “Polychlorinated Biphenyls (PCBs),” found at Internet address

http://www.epa.gov/oppt/pcb/effects.html, retrieved Mar. 12, 2004.

 77 Authority is granted under the Toxic Substances Control Act of 1976.

 78 Environmental Technology Council, Washington, DC, comments submitted to the USITC

regarding Investigation No. 332-455, Nov. 5, 2003.

 79 USITC Dataweb. For example, U.S. trade under heading 3825 of the Harmonized Tariff

Schedule of the United States (2003) includes substantially more trade with Canada than with

Mexico with respect to clinical waste as a residual product of the chemical or allied industries

during January 2002 through September 2003. 

 80 Texas Center for Policy Studies, p. 3.

 81 Texas Center for Policy Studies, p. 61.

 82 Shipments are principally electric arc dust containing zinc and other metals from

steelmaking.

 83 Texas Center for Policy Studies, p. 59.

 84 Certain environmental controls for high temperature recovery units are lower in Mexico,

as are liability costs and financial assurance requirements as regard operating recycling plants,

according to the Texas Center for Policy Studies.

 85 Texas Center for Policy Studies, p. 20. As Texas reportedly lacks the capacity to manage

zinc recovery, most of this waste is sent to Mexico for recycling. 

 86 Agreement Between the Government of the United States of America and the

Government of Canada Concerning the Transboundary Movement of Hazardous Waste, Oct.

28, 1986, as amended in 1992. By an exchange of letters, the amendment in 1992 extended

the agreement to include solid waste.

 87 Annex III to the Agreement Between the United States of America and the United

Mexican States on Cooperation for the Protection and Improvement of the Environment in the

Border Area: Agreement of Cooperation Between the United States of America and the

United Mexican States Regarding the Transboundary Shipments of Hazardous Wastes and

Hazardous Substances (“La Paz Agreement”), Nov. 12, 1986.

 88 Revision in May 2002 of OECD Decision C(92)/39/final.

3-13

polychlorinated biphenyls (PCBs),76 the process to obtain the U.S. EPA’s approval to

transport wastes containing PCBs into the United States77 within authorized

concentrations may take several years and only the U.S. Department of Defense has

been approved for such shipments.78

U.S. trade in hazardous waste with Mexico is believed to be more limited than with

Canada,79 as Mexican law bans imports of such waste for final disposal.80 In

addition, under the La Paz Agreement and Mexican environmental legislation,

maquiladora plants that use substantially U.S. inputs must return hazardous wastes

generated in Mexico to the United States, although the extent of compliance

reportedly is subject to question.81 However, hazardous waste shipped to Mexico82

from the United States for the purpose of recycling is believed to have increased

significantly since NAFTA entered into force.83 Factors contributing to the increase

in U.S. shipments to Mexico include likely cost advantages in using Mexican

recycling firms84 and a lack of capacity in the United States to treat certain hazardous

waste.85

The United States has major international agreements with Canada86 and Mexico87--

its principal trading partners for waste services-- regarding transboundary shipments

of waste. In addition, the United States abides by the Organization for Economic

Cooperation and Development (OECD) decision concerning the control of

transboundary movements of wastes destined for recovery between OECD

members.88 However, the United States is not a party to the United Nations’ Basel
 89 Parties to the Basel convention agree not to trade in hazardous wastes with nonparties,

without an agreement pursuant to Article 11 of Basel which does not derogate from

environmentally sound management provisions specified in the convention. EPA, OSW,

correspondence to a U.S. importer, June 17, 1996.

 90 EBI, The U.S. Environmental Industry and Global Market, p. 9-4.

 91 Industry representatives, interviews by USITC staff, Rockville and Dickerson, MD, Sept.

11 and 25, 2003.

 92 EPA, “EPA Funds Nine Projects to Test New Approaches to Waste Reduction,

Recycling, and Land Revitalization,” press release, July 10, 2003.

 93 EBI, The U.S. Environmental Industry and Global Market, p. 11-8.

 94 Ibid., p. 9-33.

 95 Industry representative, e-mail response to USITC staff, Dec. 16, 2003.

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Convention on the Control of Transboundary Movements of Hazardous Wastes and

Their Disposal (Basel).89

Future Prospects

As the number of U.S. landfills continues to decline, demand for additional transfer

stations is likely to continue to increase,90 which could provide additional sources of

revenue for firms operating such facilities. Remaining landfills are likely to prolong

their life spans through the increased use of bioreactor processing technologies,

which accelerate waste decomposition.91 As the capital expense to establish and

operate waste-to-energy plants is prohibitive in many areas, the EPA and most states

will likely emphasize source reduction as the centerpiece of solid waste management

plans. To illustrate, in July 2003, the EPA announced nine new projects that will

evaluate various approaches to waste minimization and energy recovery. These

projects would build on programs seeking to encourage production and consumption

of products that are easy to recycle and that contain recyclables.92 Such projects are

likely to stimulate additional market opportunities for environmental engineers,

consultants, technology companies, and large multidimensional waste management

firms providing services related to source reduction.

Large industrial generators of hazardous waste appear to be seeking more waste

management services from fewer suppliers.93 Accordingly, demand will likely

increase for suppliers with broader breadth of expertise and geographic coverage. 

For example, leading hazardous waste management firms are increasingly providing

clients with choices of bundled services that span client waste management

operations from generation to final disposition of waste. The availability of such

services would further enable clients of waste management firms to contract for these

services in lieu of dedicating in-house resources. Additional outsourcing of waste

management functions to services firms is likely, as part of an accelerating trend

across industries toward outsourcing many facets of administrative, sales, and

marketing expenses.

In the absence of major new domestic environmental regulations, further market exit

and consolidation of waste management firms among smaller and regional firms are

considered likely.94 Additional acquisitions of domestic waste management firms by

foreign parent firms are considered by industry sources to be more likely than

increases in U.S. firms’ acquisitions or operations in foreign markets.95
 96 Industry representative, interview by USITC staff, Washington, DC, Nov. 12, 2003.

 97 Industry representative, e-mail response to USITC staff, Dec. 16, 2003.

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Opportunities regarding services trade and investment abroad for U.S. waste

management and related services firms are likely greatest in hazardous waste

management services in Latin American and Asian markets, conditioned on adequate

funding necessary to increase infrastructure and establish enforcement capacity.96

However, the movement of waste across U.S. borders is likely to decrease,97 in part

as source reduction programs accelerate.

 1

 The North American Commission for Environmental Cooperation, mandated under the

NAFTA, facilitates a trinational work program that addresses cross-border environmental

issues. In addition, working groups of officials from the three countries address areas such as

implementation of compatibility among national standards for transporting hazardous

materials, including hazardous waste. These groups continue cooperative efforts first begun

on a bilateral basis predating the NAFTA to deal with transboundary environmental issues,

including waste management.

4-1

CHAPTER 4

CANADA AND MEXICO

Introduction

The Canadian market for waste management services is approaching maturity yet

open to new service suppliers. Canada is likely a net importer of waste management

services, and leading U.S. and other non-Canadian firms operate in both solid and

hazardous waste management segments in Canada. The Mexican market for waste

management services is in the early stage of development, is undercapitalized, and

with respect to solid waste services is dominated by the public sector. Market

participants in Mexico are chiefly Mexican-owned firms, with only moderate

involvement from U.S. or other foreign-owned firms. The North American Free

Trade Agreement (NAFTA) has augmented cooperative efforts and stimulated the

development of trade and capacity building in waste management services.

This chapter presents an overview of the regional market and the Canadian and

Mexican markets individually with regard to size, key suppliers and consumers,

principal technologies, and regulatory circumstances; addresses the nature and extent

of trade and investment in this industry in both markets; and discusses the future

outlook for the Canadian and Mexican markets for waste management services.

Regional Market Overview

Since its inception, the NAFTA is thought to have stimulated economic development,

especially in the border areas, and accelerated trade and investment opportunities

across all industry sectors, including waste management services. Noting the

increased opportunities and accompanying challenges of such growth, the NAFTA

partners incorporated an environmental side agreement into the NAFTA that

mandated, among other provisions, new cooperative efforts1

 and regulatory

harmonization, where feasible, on a range of environmental issues, including waste

management. At the same time, the NAFTA created one of the most open markets

for solid and hazardous waste services in the world, and provided mechanisms for the

settlement of disputes when trade or environmental laws are thought to be violated. 

Although Canada and Mexico are at different stages in the development of regulatory

regimes and capacity for the management and reduction of waste streams,
 2

 Environmental Business International (EBI), The Global Environmental Market by

Region, 2000, attachment to an e-mail message, received July 31, 2003.

 3

 Includes collection and transportation of waste for disposal and recycling.

 4

 Statistics Canada. “Waste Management Industry Survey 2000,” found at Internet address

http://www.statcan.ca/english/freepub/16F0023XIE/16F0022XIE00001.pdf/, retrieved Aug. 6,

2003.

 5

 Statistics Canada, “Waste Management Industry Survey 2000."

 6

 Waste Management Inc., corporate information on Canadian affiliate found at Internet

address http://www.wm.com/canada/index.asp/, retrieved Aug. 1, 2003.

 7

 Industry representative, telephone interviews by USITC staff, Aug. 11, 2003.

4-2

both countries have committed to improving solid and hazardous waste services

through greater market liberalization and transparency.

Canada

Market Overview

The Canadian market for solid and hazardous waste services is larger than markets in

certain other developed countries, such as Australia and New Zealand, but

significantly smaller than the solid and hazardous waste markets in the United States

and Japan. Revenues generated by the solid waste services industry in Canada were

estimated at $2.3 billion in 2000, while the revenues generated by the hazardous

waste services industry were estimated at $400 million.2

 The collection and

transportation segments3

 of the solid and hazardous waste industry together account

for the majority of revenues (66 percent).4

 Within the collection and transportation

segment, industrial, commercial, and institutional clients account for 77 percent of

revenues, whereas residential clients account for only 18 percent, and 5 percent come

from other sources. Ontario and Quebec are Canada’s largest provincial markets for

solid and hazardous waste services, accounting for 45 percent and 21 percent of

industry revenues, respectively. In 2001, the Canadian solid and hazardous waste

services industry employed almost 31,000 workers.5

 Of these, private-sector firms

employed 24,197 workers and the public sector employed 6,783 workers. During

1998-2000, private-sector employment rose by 18 percent, while public-sector

employment declined by 6 percent, reflecting an ongoing shift in the provision of

solid and hazardous waste services from government to private companies.

Canadian Waste Services, a wholly owned subsidiary of the U.S.-based Waste

Management Inc., is Canada’s top provider of solid waste services. The firm

employs 3,600 workers and provides collection, transportation, disposal, and

recycling services to customers throughout the country.6

 Casella Waste Systems, Inc.

(U.S.) also provides solid waste services in Canada. Key hazardous waste service

providers in the Canadian market include PSC (Philip Services)(U.S.), Clean Harbors

(U.S.), Onyx (France), and Safety-Kleen (U.S.). A large number of small- and

medium-sized firms also comprise a significant portion of the Canadian hazardous

waste services market. Although competition is high7

 in the hazardous waste

management market, particularly among medium-sized firms that focus on the
 8

 Statistics Canada, “Waste Management Industry Survey 2000."

 9

 Ibid.

 10 Ibid.

 11 Environment Canada representative, telephone interview by USITC staff, Aug. 13, 2003.

4-3

provision of certain niche services, specialization prevents direct competition among

large firms for certain revenue streams.

Canada generated 31.4 million metric tons of nonhazardous solid waste and

approximately 6 million metric tons of hazardous waste in 2000 (table 4-1).8

 Fiftyone percent of nonhazardous solid waste is generated by the industrial/commercial

sector. Residential solid waste comprises 36 percent of the waste stream, and

construction waste accounts for the remaining 12 percent. The majority (62 percent)

of the solid and hazardous waste stream is generated in Ontario and Quebec.

In 2000, 73 percent of Canada’s solid waste stream was disposed of in Canadian

landfills and incinerators, while approximately 24 percent was diverted and recycled.9

The most common materials recycled include mixed paper and newsprint (32 percent

of recycled materials, by weight) and ferrous metals such as iron and steel (25

percent). Recent efforts to increase composting rates led to a 45-percent increase in

the amount of materials composted during 1998-2000. As a result, by 2000, organic

waste accounted for 13 percent of all materials recycled in Canada. In 2000, almost

900,000 metric tons (net) of Canada’s solid waste, or 3 percent of the waste stream,

was exported to foreign facilities, primarily in the United States.10 Recyclable

material accounted for about one-third of these Canadian waste exports.

The majority of regulations governing solid and hazardous waste management in

Canada are prescribed at the provincial and municipal levels. These regulations are

currently undergoing harmonization, primarily through discussions in the Canadian

Council of Ministers of the Environment (CCME), an intergovernmental forum

comprised of environmental ministers from the federal, provincial, and territorial

governments. In 1998, all Canadian provinces, with the exception of Quebec, signed

The Canada-Wide Accord on Environmental Harmonization, which allows provincial

governments to retain their existing authorities, but commits them to using this

authority in a coordinated manner to achieve harmonized environmental regulations. 

Already, CCME has produced a number of model regulations and standards that have

yielded some harmonization. According to Environment Canada, remaining

discrepancies among provinces regarding solid and hazardous waste services are

minor and not of commercial significance.11 

The jurisdiction of the Federal Government is limited to federal facilities and lands,

aboriginal lands, transboundary movement of hazardous waste (both interprovincial

and international), and implementation of international commitments, including the

recently signed Rotterdam Convention on the Prior Informed Consent Procedure for

Certain Hazardous Chemicals and Pesticides in International Trade, the Basel

Convention on the Control of Transboundary Movement of Hazardous Wastes and

their Disposal, and binational agreements such as the Agreement Between the United
4-4

Table 4-1

Selected characteristics of the Canadian solid and hazardous waste services market

Item Solid waste Hazardous waste

Waste

generation/treatment

Canada generated 31.4 million

metric tons of solid waste in 2000,

a substantial proportion of which is

believed to be managed.1

Canada generated approximately 6

million metric tons of hazardous

waste in 2000, virtually all of which

is managed.1

Market size (2000) $2.3 billion;2

 1,737 firms.1 $400 million.2

Employment (2000) The solid and hazardous waste industry employs 30,980 workers, of whom

24,197 were employed by the private sector.1

Trade (2000) Available data reflect the volume of

Canadian waste that was

transported abroad (1 million tons)

and the volume of foreign waste

that was transported to Canada

(97,000 tons) for treatment and

disposal. Based on these data,

Canada was likely a net importer of

solid waste management services.1

Available data reflect the volume of

Canadian waste that was

transported abroad (324,000 tons)

and the volume of foreign waste

that was transported to Canada

(560,000 tons) for treatment and

disposal. Based on these data,

Canada was likely a net exporter of

hazardous waste management

services.1

Nature of industry Competitive, but not highly

concentrated.3

 The market is

experiencing a shift from

government provision of waste

management services to

contractual provision of services by

private firms, which has led to

increases in the number of firms in

the market in recent years.1, 3

Competitive; likely to consolidate,

owing to overcapacity in disposal

technologies.3

Key market participants

(and location of parent)

Canadian Waste Services (U.S.).4 Clean Harbors (U.S.); Onyx

(France); Philip Services (U.S.).4

Principal methods of

waste treatment and

disposal

Landfills and incinerators disposed

of 23 million tons (73 percent of

generated solid waste) in 2000, and

7.5 million tons (24 percent) was

recycled.1

1.1 million tons was treated and

disposed of in 2000.1

Key legislation Canadian Environmental Protection

Act of 1999 (CEPA)5

Canadian Environmental Protection

Act of 1999 (CEPA);5

Transportation of Dangerous Goods

Act of 1992.6

Regulatory authorities Environment Canada; provincial and territorial legislatures and ministries

of environment.5

See footnotes at end of table.
 12 The agreement was signed and entered into force in 1986. An amendment in 1992

extended coverage in the agreement to also include “other waste,” defined as municipal solid

waste sent for final disposal or for incineration with energy recovery.

4-5

Table 4-1—continued

Selected characteristics of the Canadian solid and hazardous waste services market

Item Solid waste Hazardous waste

GATS commitments Canadian commitments grant full market access and national treatment for

the provision of refuse disposal services through cross-border supply

(mode 1), consumption abroad (mode 2), and commercial presence (mode

3).7

Other measures affecting

trade and investment

(

8

) Rotterdam Convention on the Prior

Informed Consent Procedure for

Certain Hazardous Chemicals and

Pesticides in International Trade;9

Basel Convention on the Control of

Transboundary Movement of

Hazardous Wastes and Their

Disposal;10 Canada-U.S. Agreement

Concerning the Transboundary

Movement of Hazardous Waste;11

North American Agreement on

Environmental Cooperation.12

 1 Statistics Canada, Waste Management Industry Survey, Business and Government Sectors 2000,

catalogue No. 16F0023XIE, Mar. 2003.

 2

 Environmental Business International Inc. (EBI), Environmental Business Journal, vol. xvi, No. 5/6,

2003, p. 5; EBI data, e-mailed to Commission staff.

 3

 Industry representatives, telephone interviews by Commission staff, Aug. 2003.

 4

 Corporate annual 10-K reports.

 5

 For information on environmental laws, regulations, and regulatory authorities in Canada, see

Government of Canada, Environment Canada, found at Internet address

http://www.ec.gc.ca/EnviroRegs/ENG/Default.cfm.

 6

 Enacted in 1992, this act is administered by Transport Canada with assistance from Environment

Canada. For information, see Internet address http://www.laws.justice.gc.ca/en/T-19.01/text.html.

 7

 General Agreement on Trade in Services (GATS), Canada: Schedule of Specific Commitments,

GATS/SC/16, Apr. 15, 1994.

 8

 Not available.

 9

 In August 2002, Canada published final regulations in the Canada Gazette concerning implementation

of the Rotterdam Convention in Canada. For more information, see Environment Canada, found at Internet

address http://www.ec.gc.ca/dpr/2003/en/c4a.htm.

 10 In August 1992, Canada ratified the Basel Convention, which entered into force in Canada on Nov.

26, 1992. For more information on the Basel Convention, see Environment Canada, found at Internet

address http://www.ec.gc.ca/international/multilat/tmhw_e.htm.

 11 Agreement Between the Government of the United States of America and the Government of Canada

Concerning the Transboundary Movement of Hazardous Waste, Oct. 28, 1986, as amended in 1992. By

an exchange of letters, the amendment in 1992 extended the agreement to include solid waste.

 12 This agreement which is the environmental side agreement to the NAFTA, entered into force on Jan.

1, 1994. For more information, see Internet address http://www.naaec.gc.ca/eng/index_e.htm.

States and Canada Concerning the Transboundary Movement of Hazardous Waste.12

However, the federal government is able to exert some control over local regulations

by requiring federal authorization of hazardous waste movements. The primary

federal regulatory agency governing solid and hazardous waste services is
 13 New regulations have been drafted and taken through the mandatory consultation

process. 

 14 Canadian industry representative, telephone interview by USITC staff, Aug. 11 and 18,

2003.

 15 Canadian industry representative, telephone interview by USITC staff, Aug. 18, 2003.

 16 Ontario’s Waste Diversion Act of 2002 may eventually alleviate some of the

requirements for landfilling by distributing the fees collected from waste generating industries

to municipalities for use in new waste management programs and equipment, and allocating

funds to waste diversion programs including expansion of recycling programs, all of which

are likely to create further opportunities for private investment in waste management services.

 17 U.S. Department of State and U.S. Department of Commerce, U.S. Foreign &

Commercial Service, “Canada: Municipal Solid Waste Equipment,” Industry Sector Analysis,

May 30, 2003, found at Internet address http://www.stat-usa.gov/, retrieved Oct. 9, 2003.

4-6

Environment Canada, which receives its authority from the Canadian Environmental

Protection Act of 1999 (CEPA). First enacted in 1988, the legislation was

significantly revised in 1999 to expand coverage and shift the focus to upstream

methods of pollution and waste reduction. CEPA 1999 provides the mandate for

revision of existing federal regulations governing the transboundary movement of

hazardous waste and provides new authority for the development of regulations

governing the transboundary movement of nonhazardous waste. Representatives

from Environment Canada estimate that new regulations governing nonhazardous

waste will be completed by 2004.13 Canada’s federal regulatory process allows for

significant input by industry and stakeholders, and industry sources indicate that this

process yields fair and balanced regulations.14

Recent regulatory and technological developments have had an impact on the size

and nature of the Canadian market for solid and hazardous waste services. For

example, according to industry sources, as regulations in Canada increasingly focus

on waste reduction technologies, the market for hazardous waste services has been

shrinking. Thus, many in the industry believe that the industry has reached, and

possibly exceeded, capacity. Additionally, recent advances in sorting technology

favor a market structure in which one stream of consolidated waste feeds into the

system and many streams of separated waste and recyclables flow out.15 These

advances are creating a competitive advantage for a number of firms, especially in

the recycling market.

Trade and Investment

Data specific to trade and investment in the Canadian solid and hazardous waste

services industry are not available. However, related data and anecdotal information

suggest that Canada’s international transactions in this sector are significant,

particularly with the United States. Anecdotal evidence suggests that Canada is a net

importer of solid waste management services, as U.S. waste management firms earn

substantial revenues from Canada by disposing of large quantities of waste

transported into the United States from certain Canadian localities. For example,

since January 2003, all solid waste generated in the city of Toronto,16 which is

estimated at 1.25 million metric tons per year, has been exported to Michigan

landfills, due to the closing of Toronto’s only landfill site.17
 18 Industry representative, telephone interview by USITC staff, Aug. 2003.

 19 Statistics Canada; and “15 Percent Decline in Imports of Hazardous Wastes and

Hazardous Recyclable Materials in 2002,” Canada News Wire, Aug. 20, 2002, found at

Internet address http://www.newswire.ca/, retrieved Aug. 22, 2003.

 20 Statistics Canada, “Waste Management Industry Survey 2000.”

 21 Clean Harbors, Inc., annual report on Form 10-K, year ended Dec. 31, 2002.

 22 The Canadian Government has asked Canada’s Federal Court to set aside the tribunal’s

decision on grounds that in certain respects the tribunal exceeded its authority and disregarded

Canada’s public policy. Government of Canada, Department of Foreign Affairs and

4-7

Data on the cross-border trade of wastes provides some estimate of the magnitude of

trade in hazardous waste management services, as the export of waste may indicate

the import of a waste management service. Such data indicate that Canada is likely a

net exporter of hazardous waste services, although its surplus may have decreased in

recent years. Historically, Canadian imports of hazardous waste have significantly

outstripped exports, as Canadian hazardous waste regulations were less strict than

those in the United States. However, in 2000, Ontario tightened regulations by

requiring pretreatment of hazardous waste before landfilling.18 These new

regulations are more in line with U.S. standards, and, thus, the cost advantage of

exporting such waste to Canada has been reduced. As a result, Canada’s imports of

hazardous waste have decreased significantly in recent years, from almost 663,000

metric tons in 1999 to approximately 423,000 metric tons in 2002.19 During 1999-

2000, Canada’s hazardous waste exports increased from 268,000 metric tons to

324,000 metric tons.20 The United States dominates Canadian trade in hazardous

waste, having accounted for more than 97 percent of imports and 96 percent of

exports in 2000. More than 99 percent of all waste imported for disposal in Canada

was destined for Ontario and Quebec. 

Anecdotal information suggests that Canada purchases a significant amount of solid

and hazardous waste services from Canadian-based affiliates of foreign-owned firms,

particularly U.S. firms. As stated previously, Canadian affiliates of U.S. firms such

as Waste Management Inc. and Laidlaw are top providers of solid waste services in

Canada, while Canadian affiliates of U.S. firms such as Safety-Kleen, Philip

Services, and Clean Harbors are top hazardous waste services providers. For

example, Waste Management Inc.’s affiliate, Canadian Waste Services, provides

solid waste services to 4 million residential and 150,000 commercial and industrial

customers in Canada; Clean Harbors conducts hazardous waste operations in six

Canadian provinces, including at two commercial landfills and two incineration

plants.21 The French firm Onyx also provides solid and hazardous waste services

through Canadian affiliates. In 2003, a Canadian solid waste services company,

Capital Environmental Resources Inc., acquired collection, landfill, and transfer

station properties in Arizona. 

There are no significant barriers to investment in the Canadian waste management

market. Canada has made specific and full commitments on solid and hazardous

waste services under the GATS. However, transboundary movement of solid and

hazardous waste has historically been a controversial and litigious issue for Canada. 

In 2002, a NAFTA dispute settlement tribunal awarded $6 million plus interest to S.

D. Myers Inc. (U.S.) in a suit filed by the firm in 1998 against Canada for banning

the exportation of PCB waste from Canada to the firm’s U.S. facility for treatment or

destruction.22 The case has stimulated discussion as to ramifications for future 
International Trade, “Dispute Settlement: NAFTA - Chapter 11 - Investment: Cases Filed

Against the Government of Canada,” found at Internet address http://www.dfaitmaeci.gc.ca/tna-nac/SDM-en.asp/, retrieved Aug. 8, 2003.

 23 Brian Trevor Hodges, “Where the Grass is Always Greener: Foreign Investor Actions

Against Environmental Regulations Under NAFTA’s Chapter 11, S.D. Myers, Inc. v.

Canada,” Georgetown International Environmental Law Review, winter 2001, LexisNexis

Academic, found at Internet address http://80-web.lexis-nexis.com/, retrieved Aug. 8, 2003.

 24 Organization for Economic Cooperation and Development (OECD), Environmental

Directorate, OECD Environmental Data: Compendium 2002, found at Internet address

http://www.oecd.org/, retrieved Aug. 7, 2003. 

 25 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

 26 In an effort to better control hazardous waste, Mexico’s National Institute of Ecology

(INE) has undertaken an effort to register all companies generating hazardous waste. 

Registered firms must report their production of hazardous waste and demonstrate their

compliance with proper disposal techniques. As of May 2000, INE registered 27,820

companies as hazardous waste generators. These companies reported generating just over 4

million tons of hazardous waste per year. INE estimates that this represents about 40 percent

of the total market. 

 27 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

 28 Ibid.

4-8

disputes in which the NAFTA’s commercial and environmental provisions come into

conflict.23 

Mexico

Market Overview

In 2000, Mexico generated at least 31 million metric tons of solid waste, of which

households accounted for about 84 percent (table 4-2).24 By weight, organic material

was the principal component of the solid waste stream (52 percent), followed by

paper and paperboard (14 percent), plastics and glass (10 percent), textiles and other

waste (20 percent), and metals (3 percent). Most private-sector sources estimate that

between 6 and 11 million metric tons of hazardous waste are produced each year in

Mexico,25 while the Mexican Government estimated that hazardous waste generation

was close to 8 million metric tons in 1997.26 There are likely over 100,000

manufacturing companies and millions of other entities, including households, that

generate hazardous waste in Mexico.27

Discrete data on the size of the Mexican solid and hazardous waste services market

are not available. It is estimated that in 2001, the combined market for solid waste

equipment and services totaled $505 million dollars, while the market for hazardous

waste equipment and services totaled $210 million.28 It is estimated that $1.7 billion

of new investment is needed annually to develop and construct the infrastructure
4-9

Table 4-2

Selected characteristics of the Mexican solid and hazardous waste services market

Item Solid waste Hazardous waste

Waste

generation/treatment

Mexico generated at least 31 million

metric tons of solid waste in 2000,1

most of which was reportedly

managed.2

Mexico generated 6 to 11 million

metric tons of hazardous waste in

2000, about one-quarter of which

was professionally managed.3

Market size (2001) The combined market for solid

waste equipment and services

totaled $505 million.3

The combined market for

hazardous waste equipment and

services totaled $210 million3

 and

comprised 873 firms.4

Trade (2000) (

5

) Available data reflect the volume of

Mexican waste that is transferred

to foreign markets for treatment

and disposal (exports) and the

volume of foreign waste that is sent

to Mexico for treatment and

disposal (imports): exports- 97,000

tons; imports- 276,000 tons.1

Nature of industry Highly fragmented; collection and

disposal services are predominantly

provided free of charge by

municipal governments, with limited

private participation.3

Rapid expansion in numbers of

firms authorized to provide

services, especially treatment

services.6

 Bio-hazardous waste

treatment segment is more

developed than other segments of

hazardous waste management.3

Imports of hazardous wastes into

Mexico are permitted only for

recycling.2

Key market participants 

(and location of parent)

Mexican-owned firms.2 Mexican-owned firms, primarily.2

Cement manufacturers are leading

providers of hazardous waste

management services.7

 Foreign

participation to date has been

largely technical assistance, with

attempts at operation or ownership

of industry infrastructure having

been largely unsuccessful,3

 except

in the medical waste services

segment, where Stericycle (U.S.)

has established a presence.8

See footnotes at end of table.
4-10

Table 4-2—continued

Selected characteristics of the Mexican solid and hazardous waste services market

Item Solid waste Hazardous waste

Principal methods of waste

treatment and disposal

Landfills; waste recycling is very

limited, and waste-to-energy in pilot

stage.2

One-fifth of total capacity to

manage hazardous waste is

provided through burning waste in

cement kilns.7

 Incineration has

grown rapidly in recent years, and

recycling has also increased. For

medical waste treatment,

sterilization predominates.3, 8 

Confinement and treatment

infrastructure for hazardous waste

management is sparse.3

Key legislation General Law of Ecological Balance and Environmental Protection.9

Regulatory authorities SEMARNAT10

GATS commitments Mexico has scheduled no commitments on refuse disposal services.

Other measures affecting

trade and investment

North American Agreement on Environmental Cooperation;11 La Paz

Agreement;12 Basel Convention.13

 1 Organization for Economic Cooperation and Development (OECD), Environmental Directorate, OECD

Environmental Data: Compendium 2002, found at Internet address http://www.oecd.org/.

 2

 Interviews by Commission staff with U.S. and Mexican Government and Mexican industry

representatives, Mexico City, Mexico, June 9-10, 2003.

 3

 U.S. Department of Commerce, International Trade Administration, Mexico Environmental

Technologies Export Market Plan, Dec. 2001.

 4

 Carlos Muñoz Villarreal, “Mexico: Identifying Complementary Measures to Ensure the Maximum

Realization of Benefits from the Liberalization of Trade in Environmental Goods and Services,” paper

prepared for the North American Commission on Environmental Cooperation and the OECD Joint Working

Party on Trade and Environment, July 2003.

 5

 Not available.

 6

 Texas Center for Policy Studies, The Generation and Management of Hazardous Wastes and

Transboundary Hazardous Waste Shipments between Mexico, Canada and the United States, 1990-2000,

May 2001.

 7

 Marisa Jacott, Cyrus Reed, Amy Taylor, and Mark Winfield, “Energy Use in the Cement Industry in

North America: Emissions, Waste Generation and Pollution Control, 1990-2001,” paper for the Commission

for Environmental Cooperation, Second North American Symposium on Assessing the Environmental

Effects on Trade, May 30, 2003, found at Internet address http://www.texascenter.org/.

 8

 Stericycle, Inc., annual 10-K reports.

 9

 Mexico’s basic environmental law, published in the Federal Official Gazette on Jan. 28, 1988, may be

found, in English, at Internet address http://www.semarnat.gob.mx/dgeia/web_ingles/.

 10 Secretariat of Environment and Natural Resources. For information, see Internet address

http://www.semarnat.gob.mx/dgeia/web_ingles/what_is_semarnat.shtml.

 11 This agreement, which is the environmental side agreement to the NAFTA, entered into force on Jan.

1, 1994. For information, see Internet address http://www.naaec.gc.ca/eng/index_e.htm.

 12 Annex III to the Agreement Between the United States of America and the United Mexican States on

Cooperation for the Protection and Improvement of the Environment in the Border Area: Agreement of

Cooperation Between the United States of America and the United Mexican States Regarding the

Transboundary Shipments of Hazardous Wastes and Hazardous Substances (“La Paz Agreement”), Nov.

12, 1986.

 13 In February 1991, Mexico ratified the Basel Convention. For more information, see Internet address

http://www.basel.int/ratif/ratif.html#basel.

Note: Data on market size in Mexico reflect estimates for equipment and waste management services

combined.
 29 U.S. Department of Commerce, “Mexico Environmental Technologies Export Market

Plan,” p. 30. Cities listed as of December 2001 are Aqua Prieta, Cancun, Leon, Los Cabos,

Los Mochis, Merida, Monterrey, Nuevo Laredo, Piedras Negras, Puebla, Queretaro, Reynosa,

Tijuana, Tlalnepantla, and Torreon. 

 30 OECD, Environmental Directorate, OECD Environmental Data: Compendium 2002.

 31 In 2000, about 8 percent of solid waste collected in large Mexican cities was recycled. 

Most households and businesses in Mexico reportedly do not separate wastes for recycling. 

U.S. Department of Commerce, International Trade Administration, “Mexico Environmental

Technologies Export Market Plan,” Dec. 2001.

 32 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

 33 Ibid.

 34 Ibid.

 35 U.S. Department of State, “Alternative Energy Use in Mexico,” message reference No.

05989, prepared by U.S. Embassy, Mexico City, July 21, 2003. 

 36 Carlos Muñoz Villarreal, “Mexico: Identifying Complementary Measures to Ensure the

Maximum Realization of Benefits from the Liberalization of Trade in Environmental Goods

and Services,” July 2003.

 37 Includes industrial waste used as alternative fuel, and biologic-infectious waste.

 38 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

4-11

opted for private participation in waste management.29 The Mexican market for solid

waste services is also characterized by significant informal sector participation. 

It is estimated that 84 percent of the population in Mexico is served by municipal

waste services.30 The rate of collection surpasses 90 percent in metropolitan areas,

but is estimated at 70 percent or less in small cities, towns, and rural areas. The share

of solid waste that is professionally disposed of is estimated at more than 80 percent

in metropolitan areas but falls below 50 percent elsewhere, especially outside of

medium-sized cities. In 2000, about 98 percent of the managed solid waste stream

was disposed of in landfills and the remainder was recycled.31 Currently, landfill

capacity is inadequate to handle the solid waste generated in Mexico, and most

existing landfills are open-air facilities that do not incorporate the latest

technologies.32 Landfills are nearing capacity, especially in large cities. Market

observers state that possible future closure of these facilities and the contracting of

new sites, if realized, could promote greater consumer consciousness regarding

recycling and reuse.33 The city of Monterrey is in the process of tendering a landfill

project that would include a gas-to-energy component. If successful, this project may

be replicated in other large cities, including Guadalajara and Mexico City.34

Managed incineration and waste-to-energy technology are used to manage only a

negligible amount of solid waste in Mexico. Currently, solid waste in Mexico is used

to produce about 11 megawatts of electrical capacity and hybrid fuel-oil/agricultural

waste is used to produce about 400 megawatts of energy.35 Minimal use of solid

waste and agricultural waste as alternative fuels for electricity production is expected

to continue indefinitely.

In 2002, 873 companies were authorized to provide hazardous waste services in

Mexico.36 Of these, 411 companies are authorized for collection and transportation. 

Additional authorized suppliers of hazardous waste services provide recycling

services (167 firms), temporary storage (124 firms), treatment (114 firms),

incineration37 (44 firms), reuse (9 firms), and confinement (1 firm).38 The number of
 39 USITC staff calculation based on data reported in U.S. Department of Commerce,

International Trade Administration, “Mexico Environmental Technologies Export Market

Plan,” Dec. 2001 and Carlos Muñoz Villarreal, “Mexico: Identifying Complementary

Measures to Ensure the Maximum Realization of Benefits from the Liberalization of Trade in

Environmental Goods and Services,” July 2003.

 40 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

 41 Marisa Jacott, Cyrus Reed, Amy Taylor, and Mark Winfield, “Energy Use in the Cement

Industry in North America: Emissions, Waste Generation and Pollution Control, 1990-2001,”

paper for the Commission for Environmental Cooperation, Second North American

Symposium on Assessing the Environmental Effects of Trade, May 30, 2003, found at

Internet address http://www.texascenter.org/, retrieved Dec. 4, 2003.

 42 According to the Mexican definition classifying waste management methods, the burning

of waste in cement kilns is considered recycling rather than incineration with energy recovery.

 43 Biohazardous waste disposal facilities in Central Mexico are working below capacity,

and some have closed or moved.

 44 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

4-12

companies authorized to provide such services increased by 32 percent during 2000-

2002,39 with particularly rapid growth in the number of firms providing treatment

services.

Approximately 26 percent of the hazardous waste stream in Mexico receives

professionally managed handling, treatment, disposal, or confinement. Hazardous

waste management is limited primarily owing to a lack of dedicated modern

facilities.40 Most hazardous waste is incinerated or treated, although hazardous waste

recycling capacity, including the ability to convert waste to energy, has increased

greatly, from approximately 500,000 metric tons in 1995 to 2.5 million metric tons in

2000. Mexico’s cement industry burns hazardous and other industrial wastes in

cement kilns as an inexpensive, alternate fuel source, and earns revenue as a waste

manager when burning waste supplied by external sources.41 Such cement kilns

represent about one-half of the total capacity to recycle42 hazardous wastes and about

one-fifth of total capacity to manage hazardous waste in Mexico. The biohazardous

waste treatment segment is more highly developed than other hazardous waste

services segments in Mexico, and capacity outstrips demand in most parts of the

country.43 The main reason for this excess capacity is significant overestimation of

the need for these services. Collected biohazardous waste is treated through

sterilization (39 percent), incineration (27 percent), the use of radio waves (25

percent), and chemical treatment processes (9 percent).44

When the Fox administration took office in 2000, one of its first actions was the

reorganization of the regulatory structure governing environmental services. Under

this new structure, the Secretariat of the Environment and Natural Resources
 45 This restructuring shifted the regulatory and governance responsibilities of the Instituto

Nacional de Ecologia (INE, National Institute of Ecology), to SEMARNAT, and recast INE as

a research center under SEMARNAT’s jurisdiction. PROFEPA was also brought under the

umbrella of SEMARNAT, and now focuses exclusively on inspections.

 46 Current list of regulations available at www.hazmat.dot.gov/nomslst.htm/.

 47 Leon Trakman, Nick Ranieri, and Lic. Marlon Omar Lopez Zapata, ed., Doing Business

in Mexico, vol. 2 (New York: Transnational Publishers, Inc., 2002). pp. 1-15 and 1-16.

 48 An important exception is federal regulation NOM-083-ECOL-1996, which outlines the

requirements for locations where final disposal facilities may be built. The regulation sets

rules governing characteristics of the soil and minimum distances of the proposed facility

from underground aquifers and populated areas.

 49 Mexican Government representative, interview by USITC staff, Mexico City, Mexico,

June 9, 2003.

 50 Under the amendment, waste management facilities and manufacturing firms must report

toxic releases, air emission, hazardous waste generation, and wastewater discharges to a

publicly available database, unlike the prior system that relied on voluntary reporting and was

deemed incomplete. Marisa Jacott, et. al., “Energy Use in the Cement Industry in North

America: Emissions, Waste Generation and Pollution Control, 1990-2001.”

4-13

(SEMARNAT) is the lead agency for nearly all environmental services,45 including

solid and hazardous waste services. The General Law of Ecological Balance and

Environmental Protection is the primary piece of legislation governing solid and

hazardous waste services in Mexico. This legislation, first enacted in 1988 and

revised in 1996, provides a general framework for biodiversity protection, assessment

of environmental risks and impacts, stewardship of natural resources, and prevention

and control of pollution. Regulations are derived from the authority provided by this

act and codified as either mandatory regulations or voluntary regulations. The pace

of issuing federal regulations on waste management has increased substantially in

recent years. As of early 2003, 25 hazardous waste regulations had been enacted or

drafted, up from 8 such regulations in 2000.46 Mexico’s environmental law is

similar in some respects to the RCRA in the United States, as both provide for a

“cradle-to-grave” approach to regulating hazardous waste, although the two

countries’ laws differ somewhat as to the constituent elements of hazardous waste,

and Mexico has only begun to implement its hazardous waste management

requirements.47 The federal government plays a limited role in regulating the

provision of solid waste management services in Mexico, as such authority almost

exclusively resides at the state and municipal government level.48 Primarily, federal

environmental authorities provide technical support and capacity-building assistance

to municipalities, and coordinate with local governments seeking regional solutions

where feasible.49

The Government of Mexico has established goals to decentralize authority over

hazardous waste regulation. However, federal regulations continue to predominate

and evolve with regard to hazardous waste services. For example, new hazardous

waste regulations require analysis of the hazardous properties of specific wastes. 

Recent amendments to the main Mexican environmental law include creation of a

mandatory pollution release and transfer registry similar to the toxic release inventory

required in the United States.50 The amendments are likely to improve public access

to important information concerning the impact of current and prospective waste

management operations. Additionally, in December 2002, the Federal Government

approved and published a new standard establishing maximum permissible emissions
 51 The new Mexican emission standards are regarded as comparable to those established by

EPA in the United States for portland cement plants, although proposed EU standards are

considered more stringent. Marisa Jacott, et. al., “Energy Use in the Cement Industry in North

America: Emissions, Waste Generation and Pollution Control, 1990-2001.”

 52 Industry association representative, interview by USITC staff, Mexico City, Mexico, June

10, 2003; and Carlos Muñoz Villarreal, “Mexico: Identifying Complementary Measures to

Ensure the Maximum Realization of Benefits from the Liberalization of Trade in

Environmental Goods and Services,” July 2003. 

 53 Loan rates offered by the North American Development Bank (NADB) are as high as

commercial rates.

 54 Industry representative, interview by USITC staff, Mexico City, Mexico, June 10, 2003.

 55 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

 56 High-level environmental experts are replaced whenever a new mayor enters office. 

Mayoral elections are held every 3 years.

 57 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

4-14

for the cement industry, including those firms that burn hazardous waste.51

Nevertheless, industry representatives have noted concerns regarding omissions and

inconsistencies in hazardous waste legislation and regulations, such as inadequate

definitions of hazardous waste.52

Although environmental awareness is gradually developing in Mexico, several

factors continue to hamper Mexican demand for waste services. For example,

Mexico’s weak economic performance in the last few years and high interest rates on

bank loans53 are believed to have significantly discouraged investment.54 Waste

collection and disposal services have historically been provided at no cost to citizens,

so municipalities are reluctant to institute a fee, and citizens are frequently unwilling

to pay, for these services, presenting a significant impediment to financing the

provision of high-quality waste services.55 Municipalities often are unable to finance

environmental feasibility studies, which undermines progress toward developing

waste management projects. Additionally, the high turnover of technical experts

administering environmental regulatory affairs at the municipal level makes longterm planning and project flow difficult.56

By contrast, demand for waste management services has been encouraged by the

availability of financing from the U.S. Export-Import Bank and international

development banks. For example, in 2002, the U.S. Export-Import Bank announced

a $100-million line of credit to Mexican public works bank BANOBRAS, which

identified 80 potential municipal projects, including some in solid waste studies. 

Additional resources are available through the North American Development Bank

(NADBank), created under the NAFTA, which provides loans and loan guarantees to

public and private sector environmental projects, the Inter-American Development

Bank, the World Bank, and other sources.57

Trade and Investment

Data specific to trade and investment in the Mexican solid and hazardous waste

services industry are not available. Nevertheless, related data and anecdotal

observations suggest that such services trade, which takes place almost exclusively

with the United States, is increasing. The Mexican Government estimated that
 58 OECD, OECD Environmental Data: Compendium 2002.

 59 Marisa Jacott, Cyrus Reed, and Mark Winfield, “The Generation and Management of

Hazardous Wastes and Transboundary Hazardous Waste Shipments between Mexico, Canada

and the United States, 1990-2000,” Texas Center for Policy Studies, report, May 2001, found

at Internet address http://www.texascenter.org/.

 60 Ibid.

 61 U.S. Department of Commerce, International Trade Administration, “Mexico

Environmental Technologies Export Market Plan,” Dec. 2001.

 62 Jan Gilbreath and Janine Ferretti, “Mixing Environment and Trade Policies under

NAFTA,” unpublished paper.

4-15

approximately 276,000 metric tons of hazardous waste were imported by Mexico in

2000, while about 97,000 metric tons were exported.58 The majority of Mexico’s

hazardous waste imports were reportedly for the recycling of electric arc dust

containing zinc and other metals.59 Hazardous waste exports from Mexico reflected

maquiladora plants in Mexico returning wastes generated at the plants to the country

of origin, and non-maquiladora entities exporting hazardous waste that could not be

managed in Mexico to the United States, in part owing to insufficient waste

management capacity.60

The volume of hazardous waste being transported between the United States and

Mexico, and thus U.S.-Mexican trade in hazardous waste services, is likely affected

by special NAFTA and non-NAFTA regulations, which apply in the border region of

the two countries. For example, maquiladora plants operated by or for a U.S. firm,

and producing goods with predominantly U.S. content, are obligated to export

hazardous waste to the United States for treatment or disposal. Since NAFTA was

signed, enforcement of these regulations on both sides of the border has been

strengthened significantly, especially through HAZTRAKS, a consultative

mechanism to facilitate information exchanges and the monitoring of hazardous

waste within a 100-kilometer radius of the U.S.-Mexican border.

Available information in the absence of official statistics suggests that few U.S. solid

waste management firms, with the exception of Waste Management Inc., operate in

the Mexican solid waste services market. Several U.S. firms, including Clean

Harbors and Stericycle, operate in the Mexican hazardous waste services market. 

Aside from a few Mexican firms involved in transporting waste to the United States

for management, Mexican waste management firms are not known to operate in the

U.S. market. It is likely that Mexican firms would be positioned to participate in the

development of waste management capacity in other Latin American markets, as

envisioned by Mexican Government environmental officials, drawing on expertise

and experience gained in transboundary waste management circumstances between

the United States and Mexico.

Mexico made no specific commitments on environmental services under the GATS. 

Moreover, inconsistency and insufficient transparency in the federal, state, and

municipal regulation of hazardous waste management have heightened the perception

of potential risk among foreign investors.61 For example, the U.S.-based firm

Metalclad made a multimillion-dollar investment to build a hazardous waste landfill

in Mexico, obtaining all required federal licences and permits.62 However, after the

plant was completed, the state government invoked its authority to designate the plant

site as an ecological preserve and the local government refused to grant a land use
 63 “Hazardous Waste Incineration and Combustion: A Tabasco Case Study,” Texas Center

for Policy Studies, English summary document, Oct. 2002, found at Internet address

http://www.texascenter.org/, retrieved Aug. 7, 2003.

 64 Industry representative, telephone interview by USITC staff, Aug. 18, 2003.

 65 Ibid.

 66 Mexican industry and government officials, interviews by USITC staff, Mexico City,

Mexico, June 9-10, 2003. 

 67 Carlos Muñoz Villarreal, “Mexico: Identifying Complementary Measures to Ensure the

Maximum Realization of Benefits from the Liberalization of Trade in Environmental Goods

and Services,” July 2003.

4-16

permit, preventing the plant from opening.63 Arguing successfully before an

arbitration panel that the Mexican state’s action amounted to expropriation,

Metalclad was awarded the right to compensation under the investor-protection

measures found in Chapter 11 of the NAFTA. Additionally, Chemical Waste

Management (U.S.) built a $32- million incineration facility in Tijuana, but the

facility was closed following the Mexican federal government’s decision not to allow

any hazardous waste incineration in Tijuana.

Future Prospects

The Commission for Environmental Cooperation (CEC), the environmental forum

created under the NAFTA, is facilitating efforts among NAFTA partners to move

toward greater harmonization of environmental regulations across North America and

to increase information exchanges and capacity-building interaction in the

environmental markets. The CEC is in the process of creating a simpler system to

track the transfer of hazardous waste across borders and ensure timely permitting. 

Industry sources have indicated that early efforts have significantly improved the

process.

In Canada, a focus on implementation of the Kyoto Protocol will likely subsume

most federal environmental legislation in the near future, including legislation

regarding solid and hazardous waste services. In addition, Canadian waste legislation

likely will be affected by efforts to create a separate regulatory structure for the

recycling industry, autonomous from the current solid and hazardous waste

regulations.64 Although representatives from the Canadian Association of Recycling

Industries (CARI) predict that this process may take 7 to 10 years, CCME has issued

separate definitions for the recycling and waste industries, thus laying the

groundwork for eventual separation.65

The development of Mexico’s waste management services market will likely be

affected by a number of factors. Waste streams, especially for hazardous waste,

appear to be increasing and are likely much more extensive than publicly reported.66

Such growth places urgency on the adoption of upgraded waste management

technologies, on changes in public attitudes and behavior toward waste management,

and on tapping unprecedented levels of new funding to build capacity in waste

management expertise and infrastructure.67 Industry sources indicate that

opportunities for public-private partnerships in the development of new waste

management projects will likely increase, with the newly created Commission for
 68 This consultative body includes representatives from the private, public, and social

sectors in Mexico.

4-17

Environmental Infrastructure68 engaged in collaborative efforts. Large multinational

firms in Mexico are in the process of developing controls on waste generation in an

effort to reduce operating costs, although the trend has yet to engage small and midsize firms. Significant growth in the hazardous waste management market is likely,

depending on the pace of regulatory developments and the creation of effective

enforcement capabilities.

 1

 For more information regarding the participation and withdrawal of U.S. waste

management firms in foreign markets, see chapter 3.

 2

 Government officials and industry representatives, interviews by USITC staff, Prague,

Czech Republic, Brussels, Belgium, and Paris, France, Oct. 24 - Nov. 4, 2003.

 3

 EU-wide waste treatment strategies are proportioned as follows: land filling, 57 percent;

incineration, 16 percent; recycling, 13 percent. In most EU member states, the average land

filling costs for nonhazardous wastes are below the costs of incineration. Consequently, in

practice, market mechanisms do not conform to the EC’s optimal waste management strategy. 

European Environmental Agency (EEA), Environmental Signals 2002, found at Internet

address http://eea.eu.int/, retrieved Dec. 9, 2003.

 4

 Industry representatives, interviews by USITC staff, Prague, Czech Republic, Oct. 24 and

27, 2003.

 5

 EU-acceding countries have replaced South East Asia as the second largest export market

for European environmental services firms. The EU Eco-Industry’s Export Potential, final

report to Director General XI of the European Commission, Sept. 1999, found at Internet

address http://www.europa.eu.int/comm/environment/enveco/industry_employment/eco.pdf,

retrieved Dec. 9, 2003.

5-1

CHAPTER 5

EUROPE

Introduction

Europe is home to several of the largest solid and hazardous waste service companies

in the world. Non-European firms currently are not active in the market, most

notably because the largest U.S. firms have withdrawn from the European market in

recent years.1

 European companies, however, continue to operate worldwide,

competing with, and at times, operating jointly with other European companies. The

European Union (EU) is the largest market within Europe, and one of the world’s

largest markets for solid and hazardous waste services. The EU is also the world’s

largest exporter of environmental services, with most of those exports destined for

the United States.

Broadly speaking, the European market for solid and hazardous waste services can be

divided between EU countries and non-EU countries. EU countries reportedly have

more rigorous environmental standards and devote more resources to enforcing those

standards.2

 EU environmental priorities3 include taking measures to reduce waste

generation associated with economic activity, so that increased prosperity will not

lead to increased waste. Many of the non-EU countries are currently in the process

of acceding to the EU, which requires them to acclimate their environmental policies

and legislation to that of the EU. This has served to create opportunities for many

EU waste services firms,4

 as technology and resources are often limited in non-EU

countries.5

This chapter includes a brief overview of the European market for waste management

services, and presents specific information on the solid and hazardous waste markets
 6

 Countries who are working towards membership in the EU include Bulgaria, Cyprus, 

Czech Republic, Estonia, Hungary, Malta, Latvia, Lithuania, Poland, Romania, Slovakia, and

Slovenia. The EU is scheduled to expand from 15 to 25 member states in May 2004.

 7

 Environmental Business International Inc. (EBI), The Global Environmental Market by

Region, 2000, attachment to an e-mail message, received July 31, 2003.

 8

 Government officials, interviews by USITC staff, Brussels, Belgium, Oct. 30-31, 2003.

 9

 Industry representative, interview by USITC staff, Brussels, Belgium, Oct. 31, 2003.

 10 Government official, interview by USITC staff, Paris, France, Nov. 3, 2003.

 11 Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 24,

2003. Hisashi Ogawa, Sustainable Solid Waste Management in Developing Countries,

presentation at the 7th International Solid Waste Association (ISWA) International Congress

and Exhibition, Oct. 1996.

5-2

of the EU and the Czech Republic, an aspirant to the European Union6

 and one of the

more-developed solid and hazardous waste markets in Eastern Europe.

Regional Market Overview

The European market for solid and hazardous waste services is the second largest in

the world, having accounted for $41.2 billion, or 31.0 percent of the global market

for such services in 2000. The vast majority of the European waste services market

is concentrated in Western Europe ($39.3 billion). Western Europe accounted for 29

percent of the global market for solid waste management services in 2000, and for 34

percent of the global market for hazardous waste management services.7

 By

comparison, Eastern Europe accounted for approximately 1 percent and 2 percent of

the global solid and hazardous waste management markets, respectively. 

Public sentiment among European countries generally favors increased

environmental protection.8

 As a result, the pace of national environmental initiatives

and public and private environmental spending is increasing, although enforcement

reportedly varies among countries.9

 Individual EU Member states develop their own

environmental initiatives, but the EU authorities in Brussels set overall environmental

policy through EU-wide directives, standards, norms, and goals. However,

implementation of the EU rules is the responsibility of individual member states, so

processes and procedures may vary from one country to another.10 Most of the

countries of Central and Eastern Europe (CEE) have reportedly enacted less

extensive environmental protection measures, although this is likely due to a lack of

capital or appropriate technology.11 However, some of these countries have made

efforts to conform to EU directives on the environment in preparation for accession

to the Community. The Czech Republic, for example, has adopted several laws

specifically for the purpose of conforming with EU environmental directives and

requirements.
 12 In terms of data collection and analysis, the EU should be considered as 15 markets with

unique characteristics, rather than as a single, homogeneous regional market. Aggregate

information on the European environmental services industry is also difficult to compile as

countries generally do not share common definitions, terminology, or classifications. 

Reporting systems and formats are not harmonized among countries, and at times, even within

countries. Solid waste market information, for instance, originates most often at the local

level, where management policies are defined and implemented, leading to differences from

region to region. Hazardous waste statistics, trade data, and market information all face

similarly inherent limitations. For example, countries and regions with data for both 1990 and

1995 show an apparent increase (on average more than 60 percent) in hazardous waste

quantities, but this is mainly due to changed definitions and new legislation. Also, there are

considerable unexplained differences between hazardous waste generation and treatment

figures. Consequently, data available at the country level are difficult to compare and data at

the EU-level should be viewed as estimates.

 13 The Member states of the EU are: Austria, Belgium, Denmark, Finland, France,

Germany, Greece, Ireland, Italy, Luxembourg, the Netherlands, Portugal, Spain, Sweden, and

the United Kingdom.

 14 The data presented in table 5-1 are an approximation of EU total waste generation, as the

available data are not based on a single common year. The data represent the latest year for

which country statistics are available, and as a result, the EU total is inherently imprecise.

EEA, Environmental Signals 2002.

 15 MEA, Environmental Signals 2002.

 16 European Commission, EU Focus on Waste Management, Luxembourg: 1999.

 17 The EC’s goal of stabilizing municipal waste generation in the EU at 1985 levels by 2000

was not met, and was significantly exceeded in almost all countries. European Environmental

Agency (EEA), Environmental Assessment Report 2003.

 18 Landfilling is generally the least expensive disposal option, even after the introduction of

landfill taxes in some European counties. EEA, Europe's Environment - the Second

Assessment, Office for Official Publications of the European Communities, 2001.

5-3

European Union12

Market Overview

As a group, the 15 Member countries of the EU13 generated approximately 1.4 billion

metric tons of solid and hazardous waste annually during the late 1990s (table 5-1).14

Current estimates of annual waste generation range as high as 3 billion metric tons. 

Within the EU, the largest producers of waste are Germany, the United Kingdom,

France, Italy, Spain, and the Netherlands.15 Along sectoral lines, agriculture,

manufacturing, construction, and mining accounted for the bulk of waste generation. 

OECD/Eurostat data indicate that overall waste generation in the EU increased by 10

percent per year during the late 1990s,16 despite efforts to minimize such generation.17

The increase may be explained by a direct relationship between economic growth and

waste generation, but also by increased activity in other environmental sectors, such

as wastewater purification and flue gas cleaning, that generate additional solid

wastes.

Landfilling is the most prominent disposal method, especially in southern EU

Member states, usually owing to its relatively low cost.18 Incineration, including

waste-to-energy activities, is also a common method of waste disposal in the EU,

despite slow public acceptance. Stronger emission controls are being employed on
5-4

Table 5-1

Selected characteristics of the European Union (EU) market for solid and hazardous

waste services

Item Solid waste Hazardous waste

Waste generation/treatment Approximately 2.2 billion

metric tons per year in

Western Europe during 1998-

2001, the majority of which

was treated.1

47 million metric tons per

year in Western Europe

during 1997-2001, virtually

all of which was managed.1

Market size (2000) $33.4 billion (total for all

Western European

countries).2

$5.9 billion (total for all

Western European

countries).2

Trade (2000) Net exporter in waste

services.3

Net exporter in waste

services.3

Nature of industry Competitive, provided more by 

private sector, with public

sector declining in market

share.3

Competitive, provided by

private sector to a greater

degree, relative to solid

waste.3

Key market participants (and location

of parent)

Veolia Environment (OnyxFrance), Suez (SITA-France),

Rethmann Entsorgungs 

(Germany), RWE Entsorgung

AG (Germany), Noell Gonlbk

(Germany).3

Veolia Environment (OnyxFrance), Suez (SITA-France,

Teris, France).3

Principal methods of waste treatment

and disposal

Land filling is the dominant

waste disposal method. 

Minority shares are split

between incineration and

recovery (recycling).1, 3

Land filling, physico/chemical

and biological treatment

(stabilization), and

incineration.1

Key European Community legislation Council Directive 91/156/EEC

on Solid Waste; Council

Directive 96/61/EC on

Integrated Pollution

Prevention and Control

(IPPC); Council Directive

99/31/EC on Landfill of Waste;

Directive 94/62/EC on

Packaging Waste.4

Council Directive

91/689/EEC on Hazardous

Waste; Council Directive

94/67/EC on Hazardous

Waste Incineration.1

Regulatory authorities European Commission; national and subnational authorities.4

See footnotes at end of table.
 19 Government representative, interview by USITC staff, Paris, France, Nov. 3, 2003.

 20 Government official, interview by USITC staff, Brussels, Belgium, Oct. 30, 2003.

 21 Government official, telephone interview with USITC staff, Washington, DC, Oct. 1,

2003.

5-5

Table 5-1—continued

Selected characteristics of the European Union (EU) market for solid and hazardous

waste services

Item Solid waste Hazardous waste

GATS commitments The European Union has scheduled full commitments on

the provision of refuse disposal services through

consumption abroad (mode 2) and commercial presence

(mode 3). No commitments have been undertaken in

the provision of such services through cross-border

supply (mode 1), due to technical infeasibility.5

Other measures affecting trade and

investment

(

6

) Basel Convention;7

Rotterdam Convention.8

 1 European Commission/Eurostat, Waste Generated and Treated in Europe, Office for Official

Publications of the European Communities, Luxembourg, 2003, pp. 6, 26, 29-31, and 39.

 2

 Environmental Business International, Inc., data e-mailed to the Commission.

 3

 Industry and government representatives, interviews by USITC staff, Brussels, Belgium, Oct. 30-31,

2003, and Paris, France, Nov. 3-4, 2003.

 4

 Found at Internet address http://europa.eu.int/comm/environment.

 5

 General Agreement on Trade in Services (GATS), European Union: Schedule of Specific

Commitments, GATS/SC/31, Apr. 1994.

 6

 Not available.

 7

 European Commission/Eurostat, Waste Generated and Treated in Europe, Office for Official

Publications of the European Communities, Luxembourg, 2003, p. 41. For more information see Internet

address http://www.basel.int.

 8

 The EC approved the convention on Dec. 20, 2002. For information, see Internet address

http://www.pic.int.

incinerators, such as in France where nonconforming incinerators will be taken out of

service within the next year.19 However, composting, recycling, and waste

minimization are the preferred modes of management for solid waste, especially in

most northern EU Member countries, which have implemented specific regulations in

an effort to encourage the use of these waste management techniques.20 The use of

recycling incentives (such as waste taxes) is increasing in Member states, but is not

yet fully integrated into waste management strategies. Recycling issues are likely to

become increasingly prominent in Europe with the introduction of policies for life

cycle management of certain products (e.g., tires, batteries, and certain chemicals),

which will make manufacturers responsible for the ultimate disposition of the

products that they produce.21
 22 Eurostat, EU Generating 27 Million Tonnes of Hazardous Waste, news release, No.

83/99, Aug. 19, 1999. In all of Western Europe, an estimated 47 million metric tons of

hazardous waste was generated annually between 1997 and 2001. European Commission/

Eurostat, Waste Generated and Treated in Europe, Luxembourg: Office for Official

Publications of the European Communities, 2003, p. 26.

 23 Landfilling is decreasing in some EU member countries, while increasing significantly in

others, making it difficult to generalize about the overall region. European Commission /

Eurostat, Waste Generated and Treated in Europe, Office for Official Publications of the

European Communities, Luxembourg: 2003, p. 30.

 24 Hazardous waste recovery methods include separate collection and use as production

inputs.

 25 Outside the EU, the situation is less clear, but several countries report low management

of hazardous waste, as measured by EU standards.

 26 EIU Viewswire, “Vivendi exits Vizzavi,” Sept. 11, 2002, found at Internet address

http://www.viewswire.com/index.asp?layout=display_print&doc_id=208367/, retrieved Oct.

17, 2003.

 27 EIU Viewswire, “Recycling firm fined,” Feb. 3, 2003, found at Internet address

http://www.viewswire.com/index.asp?layout=display_print&doc_id=143092/, retrieved Oct.

17, 2003.

 28 EEA, Europe’s Environment: The Third Assessment, (Luxembourg: Office for Official

Publications of the European Communities, 2003).

5-6

Eurostat estimates that the EU generated approximately 27 million metric tons of

hazardous waste annually in the mid-1990s.22 Although hazardous waste generally

accounts for less than 5 percent of all waste generated in Europe, the sector garners

special attention owing to the significant risks that such wastes pose to the

environment and human health. Principal management methods for hazardous waste

include landfilling23 (which often includes stabilization prior to disposal) and

incineration. In addition, several EU Member states report hazardous waste

recovery24 rates in excess of 40 percent.25

EU firms rank among the world’s leading providers of solid and hazardous waste

services and face virtually no competition from non-EU firms within their own

market. The leading companies currently active in the EU waste management market

include the waste divisions of the French companies Veolia Environment and Suez

Lyonnaise des Eaux (Sita and Teris), and German firms RWE and Rethmann. Veolia

Environment (formerly Vivendi Environment) is a recognized world leader in water

and waste management.26 Onyx, an affiliate of Veolia, is a market leader in waste

management in Europe with diversified operations in all sectors of waste

management, including waste collection, sorting, treatment, and landfill. In recent

years, the European waste management industry has been consolidating through

mergers and acquisitions. Germany is the only EU Member state in which one

provider- RWE- dominates the country’s entire waste management system.27

The EU is a world leader in the development and implementation of laws, policies,

and regulations regarding environmental protection, as the EU’s high population

density and limited land mass have led to a heightened recognition of the need for

more effective solutions to the problems of waste treatment and disposal. The

Community’s 150-plus environmental statutes include some of the world’s most

stringent environmental standards and regulations.28 Key EU directives affecting the

provision of solid and hazardous waste services include the Waste Framework
 29 Council Directive 75/442/EEC requires Member states to establish an integrated and

adequate network of disposal facilities that enables the Community as a whole to become selfsufficient in waste disposal. Further, the network must have capacity such that certain wastes,

particularly hazardous waste, may not be generated in one country in quantities that warrant

the establishment of a dedicated disposal facility in that country. European Commission,

Environment Policies, Waste Disposal, found at Internet address

http://europa.eu.int/scadplus/leg/en/lvb/l21197.htm/, retrieved Nov. 5, 2003.

 30 Council Directive 91/689/EEC covers the management, recovery, and correct disposal of

hazardous waste. European Commission, Environment Policies, Controlled management of

hazardous waste, found at Internet address

http://europa.eu.int/scadplus/leg/en/lvb/l21199.htm/, retrieved Nov. 5, 2003.

 31 In the EU Member states and accession countries, compliance with this directive is likely

to reduce the potential for environmental pollution from landfills. The directive imposes

stringent operational and technical requirements on land filling and requires a reduction in the

quantity of various waste streams entering landfills, as well as treatment of waste prior to

landfill. Council Directive 1999/31/EC entered into force on July 16, 1999. The deadline for

implementation by the Member states was July 16, 2001. European Commission,

Environment Policies, Landfill of Waste, found at Internet address

http://europa.eu.int/comm/environment/waste/landfill_index.htm/, retrieved Nov. 5, 2003.

 32 Council Directive 2000/76/EC entered into force on Dec. 29, 2000. From Dec. 28, 2002

onward, new incinerators must comply with the provisions of the Directive, while the deadline

for existing plants is Dec. 28, 2005. European Commission, Environment Policies, Waste

incineration, found at Internet address

http://europa.eu.int/comm/environment/wasteinc/index.htm/, retrieved Nov. 5, 2003.

 33 Numerous directives focus on specialized topics including waste oils, titanium dioxide,

batteries, disposal of PCBs and PCTs, end-of-life vehicles, and waste in electric and electronic

products.

 34 As part of the Commissions overall waste management strategy, several high-priority

waste streams have been identified, including packaging, vehicles, batteries, electronic waste,

and hazardous household waste. European Commission, EU Focus on Waste Management,

Luxembourg: 1999.

 35 One example of a waste prevention program is the promotion of intelligent product

design that reduces the environmental impacts of products from their manufacture to the end

of their useful life. 

 36 European Commission, Environment 2010: Our Future, Our Choice, 6th EU Environment

Action Programme, 2001-2010, 2001, p. 8.

5-7

Directive, as amended,29 the Directive on Hazardous Waste,30 the EU Landfill

Directive,31 the Directive on Incineration of Waste,32 and the Directive on Packaging

Waste.33 To improve monitoring and compliance, the Council Regulation on Waste

Management Statistics, adopted by the EU in November 2002, requires Member

states to provide Eurostat with national statistics on the generation, recovery, and

disposal of waste beginning in 2004. Numerous EU policies also focus on

environmental matters. For example, the Community Waste Management Strategy

strives to establish an integrated waste management policy.34 Also, the sixth

Environment Action Programme (EAP), which was approved by the Council in July

2002, includes a waste management program that gives priority to waste prevention,35

followed by recycling, waste recovery and incineration, and landfilling. The EAP’s

target is to achieve a 20-percent reduction in the quantity of waste destined for

disposal facilities (based on 2000 levels) by 2010, and a 50-percent reduction by

2050.36
 37 “Tied-aid” is project financing or other assistance to which certain conditions are

attached. Recipients of tied-aid are often required to procure goods and services from firms

based in the country that provides the aid.

 38 The EU Eco-Industry’s Export Potential, final report to Director General XI of the

European Commission, Sept. 1999, found at Internet address

http://www.europa.eu.int/comm/environment/enveco/industry_employment/eco.pdf, retrieved

Dec. 9, 2003.

 39 For example, prior to accession, a number of European waste management firms are

already established in the Czech Republic. Industry representative, interview by USITC staff,

Prague, Czech Republic, Oct. 24, 2003.

 40 After the acquisition of BFI by Allied Waste in 1999, the new company continued the

divestment program begun by BFI before the merger. BFI sold most of its non-North

American operations to Sita in 1998, and in 1999, Allied Waste sold its Sita holdings to Suez

Lyonnaise.

 41 Beginning in 1999 and continuing throughout 2000, WMI sold the majority of its

international operations. Securities and Exchange Commission (SEC) Form 10_K, Waste

Management , Inc., Fiscal Year Ended Dec 31, 2000, found at Internet address

http://www.sec.gov/Archives/edgar/data/823768/000095012901001398/h84376e10-k.txt,

retrieved Oct. 22, 2003.

 42 Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 27,

2003.

5-8

Trade and Investment

Anecdotal information suggests that the EU is a net exporter of both solid and

hazardous waste services. While the home market is likely to remain the primary

focus of EU waste management firms, some of the most promising growth

opportunities for such firms are in newly industrializing nations. Some overseas

expansion by European environmental services firms takes place through “tied-aid”37

provided by the European Community and Member states. Tied-aid may account for

as much as 40 percent of the EU’s environmental exports, and is most often applied

to aid projects in Southeast Asia, India, Africa, and South America.38 However, the

majority of EU environmental exports go to markets where EU tied-aid is not a factor

(e.g., the United States), indicating that EU suppliers are competitive in open market

conditions. Owing to geographic proximity, EU suppliers are in a particularly good

position to capitalize on the expected increase in demand for solid and hazardous

waste disposal services in Central and Eastern Europe, as many of these countries

prepare for EU accession.39 French companies Onyx, Sita, and Teris, German

companies RWE and Rethmann, and smaller firms based in Austria and Germany --

including Asa, Becker, Lobbe, Saubermacher, and Rumpold -- are particularly active

in Central and Eastern Europe.

One significant market development was the withdrawal of the U.S. multinationals

BFI (now Allied Waste)40 and Waste Management, Inc. (WMI) from the EU market

and Central Europe. WMI had operations in most major European countries, but by

the end of March 2002 had sold all of its European subsidiaries to former rivals. In

1999, WMI announced a shift in its strategic plan and refocused on the North

American solid waste management services market.41 Industry representatives also

report that European competitors of the U.S. firms likely gain some measure of

competitive advantage from their proximity to clients, as well as from their longstanding business relationships with clients in the region.42 Opportunities for U.S.
 43 Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 27,

2003.

 44 General Agreement on Trade in Services (GATS), European Communities and their

Member States: Schedule of Specific Commitments, GATS/SC/31, Apr. 15, 1994.

 45 European Commission, EU Focus on Waste Management, Luxembourg: 1999.

 46 New definitions covering some areas of waste and waste services were introduced in

2001, making time series analysis impossible. Czech Statistical Office, 2003.

 47 In 2002, approximately 57 percent of the hazardous waste generated in the Czech

Republic was managed within the country. Industry representative, interview by USITC staff,

Prague, Czech Republic, Oct. 24, 2003.

 48 Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 24,

2003.

 49 Government official, interview by USITC staff, Prague, Czech Republic, Oct. 27, 2003.

5-9

and other firms exist in specialized niches of the European waste management

market, such as medical waste services.43

EU member countries seem to maintain few, if any, measures that specifically apply

to the foreign provision of solid and hazardous waste services. Further, EU

commitments under the General Agreement on Trade in Services (GATS) grant full

market access and national treatment for the provision of refuse disposal services

through modes 2 and 3.44 However, some waste-related provisions may have a

particularly significant impact on non-EU waste management firms. For example,

EU policy dictates that, within Europe, waste disposal should occur as close as

possible to the site of waste generation. EU legislation also prohibits the transport of

all waste destined for disposal, as well as hazardous waste destined for recovery, to

non-OECD countries.45

Czech Republic

Market Overview

Compared to the other acceding countries, the Czech Republic generates a relatively

large amount of solid and hazardous waste, especially in the mining, manufacturing,

and power industries, and a relatively large share of the waste produced in the

country is hazardous. The Czech Republic generated 28.2 million metric tons of

waste in 2002, including 1.3 million metric tons of hazardous waste (table 5-2).46

The vast majority of generated waste is managed, and expenditures on waste

management have increased in recent years.47 Landfilling is the most prevalent

method of waste disposal, accounting for 70 percent of the annual total, although

since August 1, 1996, landfilling has only been permissible in landfills that provide

adequate technical measures to prevent environmental pollution. In response to a

government policy that aims to discourage the use of hazardous waste landfills

through increased landfill disposal fees, Czech industry is minimizing hazardous

waste by treating it and converting it to nonhazardous waste, which is cheaper to

manage.48 Recycling of both solid and hazardous waste is increasing, and financial

incentives to encourage the purchase of recycled products are under development.49

However, currently, waste is not widely used as a source of secondary inputs or for 
5-10

Table 5-2

Selected characteristics of the Czech Republic market for solid and hazardous waste

services

Item Solid waste Hazardous waste

Waste

generation/treatment

26.9 million metric tons (2002).1

Major components of waste: industrial

(23%), energy production (20%),

agricultural (16%), and municipal solid

waste (11%).

1.3 million metric tons

(2002).1

Trade Republic Available data reflect the amounts of

Czech Republic waste transferred to

foreign markets for treatment and disposal

(exports) in 2002: 317,000 tons.1

 Data for

imports are not available.

Available data reflect the

amounts of Czech Republic

waste transferred to foreign

markets for treatment and

disposal (exports) and sent to

the Czech Republic for

treatment and disposal

(imports) in 2001: 

Exports, 11,000 tons; imports,

69,000 tons.2

Nature of industry Competitive, consolidating; private

providers in major cities, mixture of public

and private providers elsewhere. Foreignowned firms are the major participants;

Czech-owned firms are declining in market

share.3

Competitive; one Czechowned and several foreignowned firms are market

leaders.3

Key market participants

(and location of parent)

Peterson (France); Asa (France); Sita

(France); RWE (Germany).3

Sita (France); Asa (France);

Dekonta (Czech Republic).3

Principal methods of

waste treatment and

disposal

Municipal waste, which accounts for about

10 percent of total Czech Republic waste,

is managed chiefly through landfilling (70

percent). Composting and recycling are

areas for current and future emphasis. 

Incineration in Czech Republic is low by

comparison with EU, may become

increasingly important as a method of

complying with EU directives on landfills.3

Available data indicate that

physico/chemical treatment is

the most widely used method

of hazardous waste

management. Land filling and

recycling are also used. 

Major effort is underway to

introduce clean production

technologies in order to

reduce waste production.3

Key legislation Czech Waste Management Act No.185/2001;1

 Waste Management Plan of

the Czech Republic (Government Regulation No. 1971, 2003).

Regulatory authorities Ministry of Environment of the Czech Republic.4

GATS commitments The Czech Republic has scheduled full commitments on the provision of

refuse disposal services through consumption abroad (mode 2) and

commercial presence (mode 3). No commitments have been undertaken in

the provision of such services through cross-border supply (mode 1).5

See footnotes at end of table.
 50 Czech Republic, Ministry of the Environment, State Environmental Policy, January 2001,

found at Internet address http://www.env.cz, retrieved Dec. 2, 2003.

 51 Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 24,

2003.

 52 Czech Republic, Ministry of the Environment, State Environmental Policy.

 53 Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 24,

2003.

5-11

Table 5-2—continued

Selected characteristics of the Czech Republic market for solid and hazardous waste

services

Item Solid waste Hazardous waste

Other measures affecting

trade and investment

(

6

) Basel Convention;7 Rotterdam

Convention (ratified).8

 1 Czech Statistical Office, Production, Treatment, Utilization and Disposal of Waste in 2002, found at

Internet address http://www.czso.cz/eng/edicniplan.nsf/p/2001-03, retrieved Oct. 23, 2003.

 2

 Ministry of the Environment of the Czech Republic, Czech Statistical Office, Statistical Environmental

Yearbook of the Czech Republic, 2002, p. 95. The Czech Republic has reported more categories of

wastes as hazardous than is the case with hazardous wastes reported under the Basel Convention.

 3

 Czech Republic industry representatives, interviews by USITC staff, Prague, Czech Republic, Oct. 24

and 27, 2003.

 4

 For information, see Internet address http://www.env.cz/.

 5

 General Agreement on Trade in Serivces (GATS), Czech Republic: Schedule of Specific

Commitments, GATS/SC/26, Apr. 1994.

 6

 Not available.

 7

 For information, see Internet address http://www.basel.int.

 8

 For information, see Internet address http://www.pic.int.

energy generation. Incineration of waste is also on the rise, although considerably

below levels in the EU, as the Czech Republic has insufficient capacity for waste

utilization or energy recovery from waste.50

Private firms account for a large majority of revenues in the Czech waste

management markets (both solid and hazardous). Municipalities commonly keep at

least a minority interest in ownership of local waste treatment companies, often

subcontracting specialized services to private individuals and firms. Most large cities

have commissioned large turnkey contracts for waste management. The City of

Prague has its own incineration plant, which is operated by private firm Asa (the

second-largest solid waste management firm in the Czech Republic) under a service

contract.51

The European Agreement concluded between the Czech Republic and the European

Union, which came into force on February 1, 1995, obligates the Czech Republic to

harmonize existing and new legal provisions, technical standards, and relevant

procedures with those of the EU, including those which relate to environmental

protection.52 The Ministry of Environment of the Czech Republic (MZP) is the state

administrator for environmental policy and legislation, and is also responsible for

harmonizing the environmental legislation of the Czech Republic with those of the

European Union. An agency of the MZP oversees the State Environmental Fund and

also manages structural funds made available by the EU to acceding countries.53 A
 54 Czech Republic, Ministry of the Environment, State Environmental Policy.

 55 Czech Republic, Ministry of the Environment, State Environmental Policy.

 56 Waste Management Inc. (U.S.) used to be in the Czech market, but has since withdrawn.

 57 Government and industry representatives, interviews by USITC staff, Prague, Czech

Republic, Oct. 24, 2003.

 58 Dollar values generated by USITC calculation. 

 59 Sita serves about 600,000 residential customers (less than 10 percent of the market) and

12,000 commercial customers. The firm ranks third in the Czech Republic in solid waste, and

first in hazardous waste and remediation.

 60 Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 24,

2003.

 61 For example, waste tires are only imported for recycling; none are exported. Imports of

refrigerators from Asia for recycling is another government priority program being put into

effect. Industry representative, interview by USITC staff, Prague, Czech Republic, Oct. 27,

2003.

5-12

Czech Parliament committee is responsible for regional environmental policy and

protection, while the oversight of waste management is to be transferred to the

regional authorities.54

Recent progress has been achieved in the form of the development of a State

administration of waste management. Legal and institutional processes have been

created for keeping records of waste generation, waste management, and waste

disposal; and the first wave of closures and reclamation of inadequate landfills has

been completed.55

Trade and Investment

The Czech Republic is a competitive market for European firms,56 however,

development funds from the EU usually are tied-aid that awards projects to EU

firms.57 As such, many of the major waste management firms in the Czech Republic

were formerly Czech-owned, but subsequently were acquired by EU-owned firms,

including Peterson (part of Veolia group, France; $56 million58 in revenues), Asa

(owned by electricity firm EDP, France; $45 million), Sita (part of Suez group,

France; $37 million),59 and RWE (Germany).60 The import and export of wastes for

recovery or disposal are permitted under current legal regulations in the Czech

Republic, as are the associated waste management services.61

Future Prospects

The future prospects of the European solid and hazardous waste services markets will

likely be most heavily influenced by the accession of several Eastern European

countries to the EU in May 2004, the trend toward regulatory incentives for waste

reduction and recovery within the EU, and the continuing privatization of public

waste services across Europe. The increase in the size of the European market will

undoubtedly create new opportunities for commerce, and accession is likely to

contribute to conditions that would support investment in technology and

infrastructure in the newer Member states. With anticipated higher levels of

economic growth in the new Member states following accession, a significant
 62 Dollar value generated by USITC calculation. 

5-13

increase in waste generation can be expected. According to European Environment

Agency (EEA) estimates, if quantities of solid and hazardous waste in the new

Member states reach the average amount per capita for the EU, the total amount of

municipal waste in these countries will increase by 50 percent by 2010. In addition,

acceding countries will be required to implement some 140 environmental directives

that may have an impact on the solid and hazardous waste services industry. It has

been estimated by the European Court of Auditors that it will cost the accession

countries up to $90 billion62 over the next decade to conform to the environmental

regulations of the European Union.

 1 What a Waste: Solid Waste Management in Asia, World Bank, May 1999. According to

the report, official waste generation estimates are believed to be extremely conservative and

could be more than double these amounts.

 2 State of the Environment in Asia and the Pacific 2000, Economic and Social Division for

Asia and the Pacific, Asian Development Bank. Figures for hazardous waste generation are

estimates and are considered to be conservative. The most common types of hazardous waste

generated in the region include solvents and pesticides. 

 3 State of the Environment in Asia and the Pacific 2000, Economic and Social Division for

Asia and the Pacific, Asian Development Bank. 

6-1

CHAPTER 6

ASIA AND THE PACIFIC

Introduction

Solid and hazardous waste services markets in Asia and the Pacific are highly varied,

reflecting the diverse economic landscape of the region. Waste generation rates and

the ability to finance waste management efforts differ among low-, middle-, and

upper-income countries. As per capita GDP rises in many Asian nations so, too, do

consumption, waste generation, and thus, demand for solid and hazardous waste

management services. While trade in waste management services seems to be in its

infancy throughout the region, foreign investment in the construction of treatment

facilities and related infrastructure is growing rapidly. It is likely that opportunities

for trade and investment will increase as the regulatory environments of Asia-Pacific

nations mature, either through adoption of new laws or more consistent enforcement

of existing regulations.

This chapter provides an overview of solid and hazardous waste services markets

across the Asia-Pacific region, and presents specific information on the Australian,

Chinese, Japanese, and Malaysian markets for such services. Australia and Japan

were selected for special emphasis owing to the relatively large size and maturity of

their solid and hazardous waste services markets, China was selected owing to the

rapid growth of its environmental services market, and Malaysia was selected owing

to its relatively long experience with environmental regulation.

Regional Market Overview

Waste generation in the Asia-Pacific region is generally increasing as economies

grow and individual consumption rises. The Asia-Pacific region as a whole generates

an estimated 1.5 million metric tons of solid waste per day, and is expected to

increase its rate of solid waste generation to at least 3 million metric tons by 2025.1

The region as a whole generated an estimated 233 million metric tons of hazardous

waste2

 in 2000, of which China accounted for the greatest share, 56 percent, followed

by India and Indonesia with 35 percent and 5 percent, respectively.3

 Industrial solid

waste accounts for an estimated 87 percent of all nonhazardous solid waste generated

in developed countries such as Japan and Australia. By contrast, in developing
 4

 Ibid.

 5 Environmental Business International, Inc. (EBI), The Global Environmental Market by

Region, 2000, attachment to an e-mail message, received July 31, 2003. Of the $40.2 billion

spent in 2000, $35.4 billion was devoted to solid waste services while $4.8 billion went

toward hazardous waste management.

 6 What a Waste: Solid Waste Management in Asia, World Bank.

 7 The informal sector comprises individuals who pick through waste at dumpsites for

reusable products and then find buyers for the materials.

 8 State of the Environment in Asia and the Pacific 2000, Economic and Social Division for

Asia and the Pacific, Asian Development Bank.

 9 Ibid.

6-2

countries such as China, industrial solid waste accounts for an estimated 65 percent

or less of solid waste generation.4

 

In 2000, the Asia-Pacific market for solid and hazardous waste management services

was valued at approximately $40.2 billion. Japan accounted for 85 percent of that

market, Australia and New Zealand an additional 4 percent, and the rest of Asia

accounted for the remaining 11 percent.5

 Resources spent on solid waste

management, accounting for 88 percent of the total market for solid and hazardous

waste services, greatly outweighed the 12 percent dedicated to hazardous waste

management. Urban areas in Asia together spend about $25 billion per year on solid

waste management, and are expected to double such expenditures by 2025.6

 

In the Asia-Pacific region, solid and hazardous waste management services are

supplied by governments, the private sector, and in many cases – especially in lowincome countries – the informal sector.7

 In high-income countries there is typically

a high degree of government regulation, but private-sector suppliers usually dominate

the market for waste management services. In developing countries where waste

management systems are less evolved, governments frequently maintain greater

control over the provision of such services or grant monopoly status to certain

domestic companies. Throughout the region, governments increasingly are

contracting out discrete waste management activities to private companies. For

example, in 2000, over 20 percent of municipal solid waste collection services in the

Asia-Pacific region were performed by private companies under contract, particularly

in Australia, China, Hong Kong, Malaysia, the Republic of Korea, Singapore, and

Thailand.8

Methods of waste treatment and disposal in the Asia-Pacific region are largely

influenced by regulation, land costs, and the evolution of waste management

programs. Use of sanitary landfills is prevalent throughout Asia and the Pacific,

employed by cities in low-, middle-, and high-income countries. Some countries in

the region, such as Japan and Australia, are using landfill gasses to generate electrical

power. Japan and Singapore are the only two countries in the region that employ

incineration as the predominant means of solid waste disposal (75 and 70 percent,

respectively).9

 Australia, Korea, Indonesia, and Hong Kong also have modern

incineration facilities.
 10 Ibid.

 11 Based on interviews by USITC staff with industry and government sources, Beijing,

China and Kuala Lumpur, Malaysia, Oct. 2003.

 12 State of the Environment in Asia and the Pacific 2000, Economic and Social Division

for Asia and the Pacific, Asian Development Bank.

 13 Signatories to the Basel Convention considered members of the Asia and Pacific region

include Bahrain, Bangladesh, Bhutan, Brunei Darussalam, Cambodia, China, Cyprus, India,

Indonesia, Iran (Islamic Republic of), Japan, Jordan, Kazakhstan, Kiribati, Kuwait,

Kyrgyzstan, Lebanon, Malaysia, Maldives, Marshall Islands, Micronesia (Federated States

of), Mongolia, Nauru, Nepal, Oman, Pakistan, Papua New Guinea, Philippines, Qatar,

Republic of Korea, Samoa, Saudi Arabia, Singapore, Sri Lanka, Syrian Arab Republic,

Thailand, Turkmenistan, United Arab Emirates, Uzbekistan, Viet Nam, and Yemen. 

6-3

Open dumping, which includes disposal in nonengineered, nonsanitary landfills, is

reportedly the most common method of solid waste disposal in low-income countries

throughout the region.10 This is likely due to weak regulation and an inability to

finance modern methods of waste management. 

Methods of hazardous waste management throughout the region vary according to

the type of substance being treated and the sophistication of treatment facilities. 

Most countries have regulations addressing the storage and treatment of hazardous

waste, though the levels of compliance vary widely. Middle- and high-income

countries are more likely to incinerate or chemically treat waste. In low- income

countries where regulation and treatment options tend to be weaker, an unknown but

believed to be significant portion of hazardous waste is released into the

environment. However, it is not uncommon for governments in low- and middleincome countries to require that companies store their hazardous waste until suitable

methods of treatment become available.11

Throughout the 1990s, the rate of recycling grew significantly in the Asia-Pacific

region, from less than 10 percent in 1988 to 30 percent in 1998.12 Paper and

paperboard are the most commonly recycled materials, but glass, metal, and plastics

are recovered as well. In middle- and high-income countries, governments and the

private sector frequently promote, fund, and/or operate recycling facilities. In the

region’s low-income countries, recycling is primarily carried out by the informal

sector. Many countries in the region are signatories to the Basel Convention and

Montreal Protocol, as well as members of the World Trade Organization, all of which

shape solid and hazardous waste management markets to some degree. For example,

member nations of the Basel Convention13 are subject to controls on international

trade in hazardous waste. GATS commitments on refuse disposal services vary

widely throughout the region, with certain economies such as Australia and Taiwan

having scheduled full commitments on refuse disposal services provided through

modes 2 and 3, and other economies such as Malaysia and New Zealand having

scheduled no commitments on this service sector. 
 14 EBI, data from The Global Environmental Market by Region, 2000 spreadsheet. 

 15 EBI, Report 2000 - Environmental Industry Overview.

 16 Survey of Environmental Markets in APEC, Asia-Pacific Economic Cooperation

Committee on Trade and Investment, June 2001.

 17 State of the Environment in Asia and the Pacific 2000, Economic and Social Division

for Asia and the Pacific, Asian Development Bank.

 18 Ibid.

 19 EBI, Report 2000 - Environmental Industry Overview.

6-4

Australia

Market Overview

Australia has the second largest environmental market in the Asia-Pacific region,

behind Japan, and the tenth largest market worldwide.14 Australian environmental

services revenues totaled $7.1 billion in 2000, of which an estimated $1.3 billion was

dedicated to solid waste services and $260 million to hazardous waste services. 

Australia generates an estimated 14.4 million metric tons of solid waste per year, 95

percent of which is managed (table 6-1). Approximately 96 percent of Australia’s

managed solid waste is disposed in landfills.15 Australia’s high rate of landfilling

reflects the country’s abundance of affordable land and a public distaste for

incineration, which was particularly acute during the late 1980s and early 1990s. The

unpopularity of incineration has reportedly prompted the country’s development of

cleaner, more advanced methods of waste disposal;16 however, these new

technologies may be better suited to the hazardous waste management industry. 

Australia generated an estimated 275,000 metric tons of hazardous waste in 2000,17

almost all of which was managed.18

In recent years, the Australian Government has strongly encouraged waste

minimization and recycling efforts among citizens and industry. Further, the

Government has undertaken an ambitious effort to reduce by 50 percent the amount

of all solid waste destined for landfills.19 Such efforts may provide market

opportunities for suppliers of technologically advanced and efficient sorting,

recycling, and incineration services. 

Treatment of solid and hazardous waste in Australia is primarily regulated through

the Environment Protection Act of 1970 and the Environment Protection (Prescribed

Waste) Regulations. At the national level, the Environmental Protection Authority

establishes waste management guidelines, but each state is responsible for crafting

specific regulations that are enforced by local governments. Regional Waste

Management Groups were created to develop a more consistent approach to waste

management in Australia by coordinating and harmonizing nation- and state-wide

waste management regulations.
6-5

Table 6-1

Selected characteristics of the Australian market for solid and hazardous waste services

Item Solid waste Hazardous waste

Waste generation/treatment Australia produces 14.4 million tons of

solid waste per year, almost all of which

is managed.1

Australia generated 275,000 tons of

hazardous waste in 2000, almost all of

which was managed.2

Market size (2000) $1.3 billion.3 $0.26 billion.3

Employment (2002-03) 11,350 employed in solid and hazardous waste management industries.4

Trade Based on anecdotal information, the country is believed to be a net exporter of

services.5 Imports account for 25 percent4 of the domestic solid and hazardous

waste management market.

Nature of Industry Competitive and moderately concentrated market: top 4 firms account for 57

percent of revenues (includes solid and hazardous waste segments).4

Key market participants

(and location of parent)

Brambles Industries Limited (Australia and United Kingdom)

Collex Pty Limited (France)

SembSita Australia Pty Limited (France and Singapore)

Leighton Holdings Limited (Australia)

Waste Recycling and Processing Corporation of New South Wales (Australia)4

Principal methods of waste

treatment and disposal

Landfills account for the largest share of

solid waste disposal in Australia (96

percent),3

 followed by composting and

waste-to-energy.

Specially engineered landfilling, longterm containment, and recycling.6

Key regulations Environment Protection Act 1970.6 Environment Protection (Prescribed

Waste) Regulations.6

Regulatory authorities Environmental Protection Authority (EPA); Regional Waste Management Groups

(RWMG); local governments.6

GATS commitments Australian commitments grant full market access and national treatment for the

provision of refuse disposal services through consumption abroad (mode 2) and

commercial presence (mode 3).7

Other measures affecting trade

and investment

Prospective foreign investors must obtain investment approval from the Foreign

Investment Review Board, which may deny specific foreign investment on the basis

of national interest.8

 1 OECD Environmental Data, 1999 Compendium, Annex 1.

 2

 Asian Development Bank, State of the Environment in Asia and the Pacific, 2000, p. 174.

 3

 EBI, EBI Report 2000: The U.S. Environmental Industry and Global Market, Sept. 2001. 

 4 Waste Disposal Services in Australia, IBIS World Pty Ltd., Aug. 20, 2003

 5

 A U.S. government representative in Australia indicates that the country is likely a net exporter of solid and

hazardous waste management services based on a comparison of the foreign revenues of Australia’s leading solid and

hazardous waste management firm in 2003 and revenues generated in Australia’s domestic waste management market.

 6

 EPA Victoria, “Waste,” found at Internet address http://www.epa.vic.gov.au/waste, retrieved Dec. 3, 2003.

 7

 General Agreement on Trade in Services (GATS), Australia: Schedule of Specific Commitments, GATS/SC/6, Apr.

15, 1994

 8

 U.S. Trade Representative, 2003 National Trade Estimate Report on Foreign Trade Barriers.
 20 A U.S. government representative in Australia indicates that the country is likely a net

exporter of solid and hazardous waste management services based on a comparison of the

foreign revenues of Australia’s leading solid and hazardous waste management firm in 2003

and revenues generated in Australia’s domestic waste management market.

 21 Waste Disposal Services in Australia, IBISWorld Pty Ltd., Aug. 20, 2003.

 22 Australian Trade Commission, news release found at Internet address

http://www.austrade.gov.au, retrieved Nov. 24, 2003.

 23 For explanations of these modes of supply, see Appendix E.

 24 EBI, data from The Global Environmental Market by Region, 2000 spreadsheet. 

Figures include environmental equipment, services, and resources such as water utilities.

 25 EBI, Report 2000 - Environmental Industry Overview, pp.18-20. While data on the

entire environmental market size are available through 2002, data on environmental market by

sector are only available through 2000. 

 26 China has three basic classifications of waste: municipal waste, industrial solid waste,

and hazardous waste. 

6-6

Trade and Investment

Though trade data are not available, Australia is believed to be a net exporter of solid

and hazardous waste management services.20 Although the heavy reliance on

landfilling reduces opportunities in other market segments, it is believed that

Australian imports of waste management services account for 25 percent of the

country’s solid and hazardous waste services market. The two most prominent

foreign companies operating in the sector include Collex Pty Limited, whose largest

shareholder is the French company Vivendi (Onyx); and SembSita Australia Pty

Limited, which is 60-percent owned by the French company SITA, and 40-percent

owned by SembCorp Waste Management of Singapore.21 Australian exporters of

solid and hazardous waste management services focus largely on the Asia-Pacific and

European markets. Most recently, the Melbourne-based Cleanevent Group was

awarded an $80 million cleaning and waste management contract for the 2004

Olympic Games in Athens, Greece.22 Australian GATS commitments grant full

market access and national treatment for the provision of refuse disposal services

through consumption abroad and commercial presence.23 

China

Market Overview

The environmental goods and services market in China is small, but has been

growing at an impressive rate in recent years due in part to China’s increased

involvement in world markets and the country’s accession to the WTO. In 2002,

China’s market for environmental goods and services totaled $7.15 million,24 which

represents a 117-percent increase over 1995 levels. Solid and hazardous waste

management services accounted for an estimated $890 million and $180 million,

respectively, of China’s environmental goods and services industry revenues in 2000

(table 6-2).25 While data on waste generation rates26 tends to be inconsistent, the

Chinese Government estimates that in 2002, the country generated 160 million
6-7

Table 6-2

Selected characteristics of the Chinese market for solid and hazardous waste services

Item Solid waste Hazardous waste

Waste

generation/treatment

160 million tons of municipal solid waste per year;

45-50 percent of which is managed.1

950 million tons of industrial solid waste per year;

85 percent of which is reportedly managed.1

10 million tons per year, most of which

is reportedly managed.1

Market size (2000) $0.89 billion.2 $0.18 billion.2

Trade Based on anecdotal information, the country is believed to be a net importer of services.3

Nature of industry Evolving market is highly fragmented and

decentralized; many municipalities regard waste

management as a free public service.1

Evolving market, not consolidated. 

Public sector dominates but the

government is encouraging private

sector initiatives.1

Key market

participants (and

location of parent)

Public sector dominates the provision of services.1 Public sector dominates the provision

of services.1

Principal methods of

waste treatment and

disposal

For municipal waste: landfilling (45 percent) and

open dumping (55 percent).1

For industrial waste: recycling (53 percent),

storing (32 percent), and landfilling (18 percent).1

Incineration, chemical neutralization,

solidification, and landfilling.1

Key regulations Law of the People’s Republic of China on the Prevention and Control of Environmental

Pollution by Solid Waste, and Regulations on the Declaration and Registration of Pollution

Discharge.1

Regulatory authorities State Environmental Protection Administration, Division of Solid Wastes and Toxic

Chemicals.1

GATS commitments Foreign suppliers of refuse disposal services may only provide services in China through a

joint venture. However, foreigners may hold majority stakes in these joint ventures. China

reserves the right to restrict the foreign provision of refuse disposal services, with the

exception of environmental consultation services, through cross-border supply.3

Other measures

affecting trade and

investment

Ambiguous licensing guidelines make it difficult for foreign engineering firms to obtain

necessary permits except on a project-by-project basis.5

All land is owned by the Government which grants fee-based usage rights for set periods. 

Compensation for early repossession of land is assured by law in some cases but is 

inconsistent and standards are unclear.5

 1 Chinese Government and industry representatives, and U.S. government representatives, interviews by USITC

staff, Beijing, China, Oct. 2003.

 2

 EBI, EBI Report 2000: The U.S. Environmental Industry and Global Market, Sept. 2001.

 3

 While trade in waste management services is minimal, some foreign companies are operating in China, primarily in

the design, construction, and operation of incinerators. There are no known Chinese companies exporting waste

management services. Chinese Government representatives, interview by USITC staff, Beijing, China, Oct. 2003.

 4

 World Trade Organization, China: Schedule of Specific Commitments, GATS/SC/135, Feb. 14, 2002.

 5

 U.S. Trade Representative, 2003 National Trade Estimate Report on Foreign Trade Barriers.
 27 Of the 950 million metric tons of industrial solid waste generated in 2002, 500 million

metric tons were multi-utilized, 170 million metric tons treated, 300 million metric tons put in

storage until a suitable means of disposal can be determined, and 26.35 million metric tons

released to the environment. Chinese Government representative, interview by USITC staff,

Beijing, China, Oct. 15, 2003. 

 28 Estimates by Chinese government representative, interview by USITC staff, Beijing,

China, Oct. 15, 2003. 

 29 For example, coal dust is often used to make bricks, and steel can be stripped from

waste and recycled. Chinese Government representative, interview by USITC staff, Beijing,

China, Oct. 15, 2003. 

 30 Chinese Government representative, interview by USITC staff, Beijing, China, Oct. 15,

2003. 

 31 Ibid. 

 32 Ibid. 

6-8

metric tons of municipal solid waste, of which an estimated 45-50 percent was

managed; 950 million metric tons of industrial solid waste, 85 percent of which was

reportedly managed;27 and 10 million metric tons of hazardous waste, most of which

was reportedly treated.28

Until recently, the government was almost solely responsible for collecting and

disposing municipal waste, but is now encouraging private participation. At least 90

percent of the municipal solid waste that is managed in China is disposed of in

landfills, largely owing to China’s abundance of inexpensive land and a shortage of

capital with which to invest in more sophisticated technologies. Incineration, while

not widely practiced, is becoming more acceptable as municipalities gain experience

with that treatment method. However, a lack of capital for the construction of new

incineration facilities and the absence of means by which to separate combustible

waste from that which cannot be burned may serve as an obstacle to more widespread

use of incineration. 

The Chinese State Environmental Protection Agency (SEPA) encourages companies

to handle their industrial solid and hazardous waste by means of multiple-utilization,

that is, by finding alternate uses for waste instead of sending it directly to landfills.29

The Government estimates that 45 percent of industrial solid waste and 50 percent of

hazardous waste is successfully reused. Hazardous waste is typically treated by

means of chemical neutralization, incineration, or solidification, with much of the

waste ultimately ending up in landfills after treatment. However, because of limited

technology and funding, and thus limited capacity, companies are frequently unable

to treat all of their hazardous waste so they must store it until treatment is possible. 

In response, the Government has planned to allocate approximately $1.94 billion for

the construction of hazardous waste treatment facilities throughout the country during

2003-2005.30 Funding will come from local, state, and foreign governments, as well

as from local and foreign industry.31

SEPA drafts and supervises the implementation of China’s environmental laws and

regulations at the national level, and coordinates with the Ministry of Construction,

the Ministry of Health, and the Development and Reform Commission, who are

responsible for municipal, medical, and industrial waste, respectively. Provincial and

local governments are responsible for the implementation of solid and hazardous

waste regulations.32
 33 Chinese Government representative, interview by USITC staff, Beijing, China, Oct. 15,

2003. 

 34 EBI, data from The Global Environmental Market by Region, 2000 spreadsheet. 

 35 Japan has two classifications of waste: generic, which includes all municipal solid

waste; and industrial, which includes both solid and hazardous waste generated in the process

of industrial activity. 

 36 State of the Environment in Asia and the Pacific 2000, Economic and Social Division

for Asia and the Pacific, Asian Development Bank.

 37 Japanese government representative, interview by USITC staff, Tokyo, Japan, Oct. 6,

2003. Japan has approximately 2000 intermediary waste disposal facilities, mainly

incinerators, where waste is reduced before final disposal in one of nearly 2000 landfills. 

 38 Japanese government representative, interview by USITC staff, Tokyo, Japan, Oct. 3,

2003. Official data on industrial waste includes both solid and hazardous waste. An estimate

of the share of solid to hazardous waste contained in this category could not be provided.

6-9

Trade and Investment

Trade in solid and hazardous waste management services is believed to be minimal,

although several international companies and donor agencies have designed and built

waste treatment facilities in China. However, the Chinese Government is actively

encouraging foreign direct investment in the market through joint ventures with

Chinese companies. Foreign equity in Chinese waste management operations is

limited to 50 percent.33 China’s GATS commitments grant national treatment for the

provision of refuse disposal services through modes 1, 2, and 3, and grant market

access through mode 2. 

 

Japan

Market Overview

Japan’s solid and hazardous waste services market is the largest in the Asia-Pacific

region and the second largest worldwide behind the United States.34 Solid and

hazardous waste management revenues in Japan respectively totaled $30.2 billion

and $3.9 billion in 2000 (table 6-3), together accounting for 36 percent of Japan’s

environmental goods and services market. Japan generates an estimated 52.4 million

metric tons of municipal solid waste each year, most of which is managed.35

Municipal governments are responsible for the construction of waste management

facilities and the collection, transportation, and disposal of waste, although such

activities are routinely contracted out to private companies. The construction of

waste management facilities is usually subsidized in part by the central government,

while waste management services are funded through waste disposal taxes levied

upon citizens. An estimated 75 percent36 of municipal solid waste in Japan is

disposed of through incineration, followed by landfilling as the second most favored

disposal option.37

Japanese companies generate 406 million metric tons of industrial solid and

hazardous waste per year,38 with the responsibility for treatment and disposal resting

solely with the individual firms generating the waste. Construction and operation of

industrial waste management facilities are funded through private investment and

disposal fees paid by waste generating firms. Several large manufacturers have
6-10

Table 6-3

Selected characteristics of the Japanese market for solid and hazardous waste services

Item Solid waste Hazardous waste

Waste

generation/treatment

238.4 million tons per year; most of

which is managed.1

Estimated 220 million tons in 2000,

most of which was managed.1, 2

Market size (2000) $30.2 billion.3 $3.9 billion.3

Employment (2001) (

4

) (4)

Trade Anecdotal information suggests that the country is an aggressive exporter

of environmental services in the Asia-Pacific region.5

Nature of industry Japan’s solid waste industry is

believed to be highly consolidated,

with domestic firms dominating

Japanese market.1

Mature market, highly competitive,

with domestic firms dominant.1

Key market participants

(and location of parent)

Mitsubishi Heavy Industries (Japan); Ebara Corp. (Japan); Kubota

(Japan); Mitsui (Japan).1

Principal methods of waste

treatment and disposal

Incineration (waste-to-energy)

accounts for the largest share of

solid waste disposal in Japan (75

percent), followed by landfilling and

composting. Figures do not

account for recycling which is

prevalent in Japan.6

Incineration, chemical treatment,

and storage.1

Key regulations Waste Disposal and Public

Cleansing Law, Law for Promotion

of Effective Utilization of Recyclable

Resources.1

Law Concerning Special Measure

Against PCB Waste.1

Regulatory authorities Ministry of the Environment, Ministry of Health and Welfare, Ministry of

Economy, Trade and Industry, and local governments.1

GATS commitments Japan grants market access and national treatment to foreign suppliers of

refuse disposal services through consumption abroad (mode 2) and

commercial presence (mode 3), but indicates that the number of licenses

conferred to service suppliers of waste oil disposal at sea from vessels

may be limited.7

See footnotes at end of table.
 39 There is some overlap between the estimated 2000 industrial landfills and the estimated

2000 generic landfills, but the extent of the overlap is unknown.

 40 Polychlorinated biphenyl acts as a heat transmission material and was used in electronic

devices and high pressure-condensers in the manufacture of processed foods. 

 41 PCBs used in electronic devices were allowed to remain in such devices.

 42 The 20,000 metric ton estimate is based on reports from the prefectural governments. 

The figure may be understated as it is believed that companies under report levels of PCB

waste. Furthermore, some of the PCB waste has gone missing and cannot be accounted for. 

 43 Incineration is a generally acceptable method of PCB disposal but is not acceptable to

the Japanese public due to concerns over toxic emissions. Japanese Government

representative, interview by USITC staff, Tokyo, Japan, Oct. 6, 2003.

6-11

Table 6-3--continued

Characteristics of the Japanese market for solid and hazardous waste services

Item Solid waste Hazardous waste

Other measures affecting

trade and investment

Complicated and expensive licensing procedures for waste management

service providers are common throughout Japan.1

Foreign companies are unlikely to enter the market successfully without a

joint venture with Japanese firm.1

 1 Japanese Government and industry representatives, and U.S. government representatives, interviews

by USITC staff, Tokyo, Japan, Oct. 2003.

 2

 An unknown but believed to be large quantity of hazardous waste in Japan is treated in-house by the

waste-generating companies, and therefore is not reflected in the market size figures. 

 3

 EBI, EBI Report 2000: The U.S. Environmental Industry and Global Market, Sept. 2001.

 4

 Not available.

 5

 While no foreign waste management firms are known to operate in the Japanese market, it is believed

that Japanese firms are active throughout the Asia-Pacific region. Government and insutry

representatives, interviews by USITC staff, Tokyo, Japan; Kuala Lumpur, Malaysia; Beijing, China, Oct.

2003; and Waste Disposal Services in Australia, IBIS World Pty Ltd., Aug. 20, 2003.

 6

 Asian Development Bank, State of the Environment in Asia and Pacific, 2000, p. 180.

 7

 General Agreement on Trade in Services (GATS), Japan: Schedule of Specific Commitments,

GATS/DC/46, Apr. 15, 1994.

incineration facilities to treat their own waste, and in some cases have leveraged

surplus capacity to enter the broader waste treatment and disposal market. Together,

there are roughly 7,000 incinerators, recycling facilities, and chemical treatment

plants for industrial waste, and approximately 2,000 industrial waste landfills.39

Japan faces a particular and high-priority challenge in the disposal of polychlorinated

biphenyl (PCB)40 waste. Following a 1968 cooking oil contamination incident that

resulted in widespread illness and, in some cases, death, the government banned all

manufacture and use of the substance. Companies using PCB were instructed to

collect and store the waste until suitable disposal methods could be identified.41 As a

result, approximately 30,000 companies are currently storing an estimated 20,000

metric tons of PCB waste.42 In 2001, the Government of Japan passed the Law of

Special Measures Concerning Promotion of Appropriate Disposal of PCB Waste,

stipulating that existing waste be properly disposed of by 2016. The Government is

planning construction of five chemical disposal sites43 throughout the country and

will contract out the assessment of environmental impacts, construction, and

operation of the new facilities to private companies. These services will ultimately
 44 Two other significant bidders on the project were Tokyo Electric, which teamed with

Mitsui, and Konsai Electric, the first and second largest electric companies in Japan,

respectively. Electric companies are some of the biggest generators of PCB waste. U.S.

Government representative, interview by USITC staff, Tokyo, Japan, Oct. 6, 2003.

 45 Japanese Government representative, interview by USITC staff, Tokyo, Japan, Oct. 6,

2003.

 46 U.S. Government representative, interview by USITC staff, Tokyo, Japan, Oct. 6, 2003.

 47 Recycle Oriented Society: Toward Sustainable Development. Clean Japan Center.

 48 According to a U.S. government official, services trade data is not readily available in

Japan because most such business is done via joint venture where a contract is awarded to the

Japanese partner and then a private deal is made for payment to the foreign partner. 

6-12

be funded by disposal fees. While the government has not disclosed the estimated

cost of the entire project, it reportedly has awarded $260 million to Mitsubishi Heavy

Industries to construct the Tokyo facility.44 Japan has no regulations mandating that

the facilities be built or operated by domestic firms.45 However, all prospective

bidders must construct a demonstration plant, at an estimated cost of $1 million, in

order to obtain approval from the Ministry of the Environment to enter a bid.46

Recycling in Japan is typically carried out by private companies without the benefit

of government subsidies, except on an ad hoc basis. These companies generate

earnings through recycling fees and resale of materials. Some Japanese

manufacturers are devising innovative applications for recycled materials, such as

substituting recycled plastics for coke in blast furnaces in steel mills. This practice

yields both economic and environmental benefits as the plastics emit fewer dioxins

than coke when burned, recycled plastic is cheaper than coke, and steel companies

can receive compensation for removing the “waste” from municipalities. 

Japan’s large solid and hazardous waste market is a product of that country’s

substantial environmental regulations. Japan’s Basic Law on the Environment (1993)

encourages environmental protection and sustainable development through numerous

regulations that legislate, inter alia, waste disposal and recycling.47 Waste disposal is

primarily governed by the Law Concerning Disposal and Cleanup of Disposed

Waste, which dictates a standard waste disposal plan. However, it is the

responsibility of individual prefectures to tailor the plan to accommodate local needs. 

Recycling is governed by the Ministry of Economy, Trade and Industry (METI). 

International treaties affecting waste management to which Japan is a signatory

include the Persistent Organic Pollutants Convention (POP Convention) and the

Basel Convention.

Trade and Investment 

Japanese Government sources report that data reflecting trade in solid and hazardous

waste services are not available.48 However, anecdotal information suggests that

Japan is an aggressive exporter of environmental services in general, and Japanese

firms are active in the design and construction of waste management facilities

throughout the Asia-Pacific region. It is reported that only domestic companies

provide solid and hazardous waste management services in Japan, principally

because it is not a highly profitable industry and it is difficult to obtain waste

management licenses from local governments due to complex technical
 49 Japanese Government representative, interview by Commission staff, Tokyo, Japan,

Oct. 7, 2003.

 50 Ibid.

 51 EBI, data from the Environmental Markets in the Asia-Pacific, 1995-2000 spreadsheet.

 52 Industry representative, interview by USITC staff, Kuala Lumpur, Malaysia, Oct. 10,

2003.

 53 State of the Environment in Asia and the Pacific 2000, Economic and Social Division

for Asia and the Pacific, Asian Development Bank.

 54 Malaysia has two classifications of waste: solid waste, which includes municipal and

industrial, and scheduled waste, which encompasses 107 types of hazardous waste. Small and

medium enterprises are more likely to under-report their waste and/or dispose of it illegally. 

Malaysian Government representative, interview by USITC staff, Kuala Lumpur, Malaysia,

Oct. 10, 2003.

 55 Environmental Quality Report 2001, Malaysian Ministry of the Environment. 

6-13

requirements.49 Domestic and foreign contractors are required to register with

municipalities in order to be eligible to operate. 

Japan’s current GATS commitments grant full market access and national treatment

for the foreign provision of refuse disposal services, with the exception of some

limitations regarding the disposal of waste oil at sea. However, according to a

Japanese government official, joint ventures are widely viewed as the only way for

foreign companies to enter the market, and there are currently no such business

arrangements in Japan’s solid and hazardous waste management industry.50

Malaysia

Market Overview

The environmental goods and services market in Malaysia – which includes the solid

and hazardous waste services segment – has grown rapidly in recent years, totaling

$840 million in 2002, a 40-percent increase over 1995 levels.51 The Malaysian

environmental services market experienced a temporary downturn because of the

Asian financial crisis. However, the Malaysian experience was comparatively less

severe than that of some of its neighbors, and the environmental market rebounded

after a one-year decline in 1998. Malaysia generates an estimated 5.5 million metric

tons52 of municipal and industrial solid waste per year, of which an estimated 45

percent is managed (table 6-4).53 The country generated 363 thousand metric tons54

of hazardous waste in 2002, of which 90-95 percent was reportedly managed.55

The Malaysian Government has aggressively pursued privatization of infrastructure

in the past decade to include the waste management industry. In 1995, the

Government awarded a 15-year exclusive contract for the management of all of

peninsular Malaysia’s hazardous waste to a single firm, Kualiti Alam. The

Malaysian company receives its revenue from waste collection and disposal fees paid

directly by the companies that generate waste. Because Malaysian companies are
6-14

Table 6-4

Selected characteristics of the Malaysian market for solid and hazardous waste services

Item Solid waste Hazardous waste

Waste generation/treatment 5.5 million tons per year; an

estimated 45 percent of which is

managed.1

363,000 tons in 2002, 90-95

percent of which was reportedly

managed.1

Market size (2000) $0.12 billion.2 $24 million.2

Employment (2001) (

3

) (3)

Trade Anecdotal evidence suggests that the country is a net importer of

services.4

Nature of industry Evolving market; 3 companies

control 75 percent of market.1

A single company has exclusive1

rights to all incineration and

chemical treatment though 2013.

Key market participants

(and location of parent)

Alam Flora (Malaysia)1

Southern Waste (Malaysia)

Northern Waste (Malaysia)

Kualiti Alam (Malaysia).1

Principal methods of waste

treatment and disposal

Open dumping (50 percent),

landfilling (30 percent).5

Incineration, chemical treatment,

and storage.1

Key regulations Environmental Quality Act of 1974 (and subsequent amendments in 1985

and 1996), Environmental Quality Regulations.1

Regulatory authorities Department of the Environment, and Ministry of Housing and Local

Government1

GATS commitments Malaysia has scheduled no commitments on refuse disposal services.6

Other measures affecting

trade and investment

Foreign investors limited to 30-percent financial stake.1

Privatization of solid and hazardous waste management services resulted

in exclusive, long-term agreements for Malaysian firms.1

 1 Malaysian and U.S. government and industry representatives, interviews by USITC staff, Kuala

Lumpur, Malaysia, Oct. 2003.

 2

 EBI, EBI Report 2000: The U.S. Environmental Industry and Global Market, Sept. 2001.

 3

 Not available.

 4

 Foreign waste management firms are present in niche areas of the Malaysian market, but Malaysian

firms are not believed to be exporting such services. Malaysian and U.S. government and industry

representatives, interviews by USITC staff, Kuala Lumpur, Malaysia, Oct. 2003.

 5

 Asian Development Bank, State of the Environment in Asia and the Pacific, 2000, p. 180.

 6

 General Agreement on Trade in Services (GATS), Malaysia: Schedule of Specific Commitments,

GATS/SC/52, Apr. 15, 1994.
 56 Industry representative, interview by USITC staff, Kuala Lumpur, Malaysia, Oct. 13,

2003.

 57 American Chamber of Commerce member companies contend that Kualiti Alam’s

services are limited, costs are rising each year, and they sometimes have to store or export

waste because Kualiti Alam cannot handle it in a timely manner. Industry representative,

interview by USITC staff, Kuala Lumpur, Malaysia, Oct. 10, 2003.

 58 Industry representative, interview by USITC staff, Kuala Lumpur, Malaysia, Oct. 13,

2003.

 59 It is believed that the law will be signed in early 2004.

 60 Southern Waste won the contract that covers Jahor state.

 61 Industry representative, interview by USITC staff, Kuala Lumpur, Malaysia, Oct. 10,

2003.

 62 Percentage based on estimates of waste generation by Malaysian industry source.

6-15

legally obligated to obtain treatment for their hazardous waste, Kualiti Alam is

assured steady revenue until its contract expires in 2013. Kualiti Alam employs

multiple hazardous waste treatment techniques, although incineration and chemical

treatment are the most prevalent. While other modes of treatment operate at

approximately 40-50 percent56 of capacity, Kualiti Alam’s incinerator is stressed to

full capacity and the company is forced to refuse waste, and thus, some companies 

are storing their waste until Kualiti Alam can accept it.57 In response, Kualiti Alam is

actively pursuing the addition of plasma technology to its portfolio of treatment

options. Kualiti Alam views oil waste, sludge, and other hazardous waste recycling

companies as its greatest competition. As a result, Kualiti Alam offers manufacturers

competitive pricing to match what they would receive from recyclers or what they

would save by implementing waste-reducing technologies.58

The management of solid waste is also undergoing privatization, though the process

is not yet complete. Treatment of solid waste in Malaysia, which is regulated by the

Ministry of Housing and Local Government, is much less sophisticated than that of

hazardous waste, with most solid waste destined for open dumps. However, as the

privatization of the sector advances, more modern methods of handling and treatment

are emerging. In 1994, the Malaysian Government identified four domestic

companies, which would each be given 20-year concessions to collect, store, and

dispose of solid waste in one of the four geographic areas devised under the plan, but

the Government will not sign the concessions until the central government passes a

bill, which transfers authority over solid waste management from local governments

to the central government.59 As such, two of the selected companies never fully

began work, while two others – Alam Flora and Southern Waste60 – proceeded at

their own risk.61 

Alam Flora was awarded the lucrative Pahang and Selang regions that include Kuala

Lumpur and account for an estimated 54 percent of generated waste.62 Alam Flora

currently manages approximately 6,000 metric tons of waste per day, much of which

goes into properly engineered landfills. The company is paid by the 24 municipal

governments that it serves, a system that the company favors as it is believed that
 63 There is unfavorable public sentiment associated with privatization due to a failed effort

with sewage privatization. In that case the company awarded the project began charging

sewage fees to the public and then did not follow through with the project. 

 64 Industry representative, interview by USITC staff, Kuala Lumpur, Malaysia, Oct. 10,

2003.

 65 The Government of Malaysia has instituted and promoted recycling programs, but

industry sources believe that efforts to date fall short of what is needed to generate widespread

participation. Industry representative, interview by USITC staff, Kuala Lumpur, Malaysia,

Oct. 10, 2003.

 66 Industry representative, interview by USITC staff, Kuala Lumpur, Malaysia, Oct. 10,

2003.

 67 Ibid.

 68 Design and construction of waste treatment facilities by foreign firms, especially

Japanese, is prevalent, but operation of such facilities by foreign firms is not.

6-16

direct billing would not be well received by residents.63 As the company’s operations

mature, it plans to build incinerators and more economical and environmentally

sound landfills. Alam Flora predicts that in the next 20 years all local landfills will

be capped and the country will rely on two super-landfills, likely abandoned tin

mines, and two high-volume incinerators. These projects are not currently viable

due, in part, to the fact that the trash volume generated in Malaysia is not high

enough to justify the rail costs.64

Few companies provide recycling services in Malaysia as this industry segment is not

believed to be lucrative due to a lack of participation by the public. Industry sources

believe that more effective and consistent public awareness campaigns are needed to

motivate the population to recycle waste products.65 Currently there are no recycling

laws in Malaysia, though the Government set a 3-percent recycling goal in 2003,

which the country has reportedly met.66 The Government intends to increase this

recycling goal by one percent per annum until it reaches 22 percent in 2023. 

According to a Malaysian industry source, the country will have difficulty

establishing a recycling industry because it is not poor enough to have an effective

informal recycling sector, but it is not yet developed enough to have a modern,

efficient recycling system.67

Trade and Investment

Trade and investment in solid and hazardous waste management services in Malaysia

is believed to be minimal owing to the monopolistic structure of both industry

segments.68 As monopoly contracts are phased out, opportunities may arise for

foreign firms to enter the market. However, current regulations state that foreign

investment in waste management firms is limited to a 30-percent equity stake. 

Despite the fairly closed market, a handful of foreign companies have found market

opportunities. For example, World Resources Company, which is U.S.-based, is

active in reclamation of precious metals from industrial waste. While the company

actually exports the waste to the United States before treating and recycling the
 69 WRC recovers silver, copper, nickel, and gold from wastewater sludge (N151 – metal

hydroxide sludge) from electronics manufacturers. However, it noted that its business is

declining as many electronics companies are moving to China and/or becoming more

technologically efficient, thereby reducing mineral waste. In 2000, the company exported

2,000 metric tons of sludge, but exported only 300 metric tons during Jan.-Oct. 2003.

 70 General Agreement on Trade in Services (GATS), Malaysia: Schedule of Specific

Commitments, GATS/SC/52, Apr.15, 1994.

 71 Japanese Government representative, interview by USITC staff, Tokyo, Japan, Oct. 7,

2003.

6-17

metals, it provides collection and transportation services in Malaysia.69 The

Government of Malaysia has not made any specific GATS commitments on refuse

disposal services.70

Future Prospects

As developing countries in the Asia-Pacific region continue to strengthen and enforce

environmental regulations, the demand for proven, cost-effective treatment methods

is likely to increase. Japanese companies that have already invested in construction

of waste management infrastructure, feasibility studies, environmental impact

assessments, etc., will likely be in a favorable position to seize upon emerging market

opportunities in those countries. 

In Japan, demand for environmental services will likely grow, especially as public

awareness of environmental issues increases. While there is not currently any

notable competition within the domestic waste management market, owing to the

propensity toward long-term contracts with established companies, industrial waste

management is becoming more competitive as new technologies emerge.71 Market

segments that may experience particularly rapid growth in the future include

environmental management consulting and pesticide disposal.

 1 Established markets for solid and hazardous waste become saturated as industries are

increasingly able to employ advanced technologies to effectively control the disposal of

waste, reduce waste output, and transfer waste into a usable commodity. To some extent,

developing waste management markets such as those of Chile, Egypt, and South Africa may

benefit from already developed and proven technology used by the more established waste

management countries. 

 2 Environmental Business International, Inc. (EBI), EBI Report 2000, The U.S.

Environmental Industry and Global Market, Sept. 2001, pp. 18-6 to 18-7; and industry

representative, interview by USITC staff, Washington, DC, Nov. 12, 2003.

7-1

CHAPTER 7

OTHER DEVELOPING-COUNTRY

MARKETS

Introduction

Although solid and hazardous waste management is in a very early stage of

development in Chile, Egypt, and South Africa, these three countries are among the

more advanced within their respective regions in terms of identifying and addressing

solid and hazardous waste management problems relative to their current structural

and resource constraints. Apparent among these three countries is a growing

recognition at the national level that there is a critical link between sustained

economic development and an effective and comprehensive environmental program

that includes solid and hazardous waste management. Accordingly, each government

has recently been making a concerted effort to move its country toward the most

efficient solid and hazardous waste management program that can be achieved with

available resources. Although these emerging waste management markets are

comparatively small, they have the potential of developing into significant trade

opportunities in the future as more established country-markets achieve saturation1

and decline in activity.2 This will likely be a long-term endeavor because Chile,

Egypt, and South Africa are still in the process of developing regulations and

standards relating to the proper management of their waste streams.

This chapter includes a brief overview of solid and hazardous waste services markets

in Africa, Latin America, and the Middle East, followed by separate discussions on

market conditions, trade, and investment in the solid and hazardous waste services

industries of Chile, Egypt, and South Africa.

Regional Market Overview

Solid and hazardous waste services markets in Africa, Latin America, and the Middle

East are relatively small, as countries in these regions often have limited financial or

regulatory capacity to address environmental concerns. In 2000, solid waste

management markets in Latin America, the Middle East, and Africa were valued at

$1.6 billion, $1.0 billion, and $442 million, respectively, while hazardous waste
 3 EBI, The Global Environmental Market by Region, 2000, attachment to an e-mail

message, received July 31, 2003.

 4 United Nations Environment Programme, Secretariat of the Basel Convention, “List of

Parties to the Basel Convention,” found at Internet address

http://www.basel.int/ratif/ratif.html, retrieved Dec. 9, 2003.

 5 U.S. Department of Commerce (USDOC), U.S. Foreign and Commercial Service

(US&FCS), Research Reports, Chile, Environmental Technologies - Solid Waste, by Isabel

Valenzuela, Oct. 13, 2001, p. 2, found at Internet address

http://www.s...penDocument&sessID=A07A043F2913979/, retrieved Apr. 29, 2003.

 6 Ibid.

 7 Includes copper, iron ore, nitrates, precious metal, and molybdenum mining.

 8 Includes waste generated by the metal manufacturing, chemicals, paper, and textiles

industries.

 9 Allen Blakey, “The Locals Rule South of the Border,” International Waste, 1999, p. 78.

 10 USDOC, Chile - Solid Waste Management - Summary - ISA 990901, 1999, p. 5.

7-2

management markets in these regions were valued at $239 million, $274 million, and

$32 million, respectively. Together, these three regions account for less than 3

percent of the global market for solid and hazardous waste management services.3

Existing environmental regulations in these regions typically address water and/or air

pollution, but do not often address solid or hazardous waste. However, Chile, Egypt,

South Africa, and a number of other countries in these regions are parties to the Basel

Convention– an international environmental accord concerning the transboundary

movement and management of hazardous waste.4

Chile 

Market Overview

Data on the size of Chile’s solid and hazardous waste services market is not

available. However, industry sources have estimated that waste generation in Chile

totaled over 1.8 billion metric tons in 200l,5

 34 percent of which was thought to

comprise hazardous waste (table 7-1).6

 The mining industry7 generates the vast

majority of waste in Chile, with an estimated 1.8 billion metric tons. Municipal

waste was thought to account for 3.3 million metric tons of waste, industrial waste8

for 2.5 million metric tons, construction waste for 3.5 million metric tons, and

medical waste for 29,000 metric tons. Based on the anecdotal evidence outlined

below, it is believed that very little of the solid and hazardous waste generated in

Chile is handled and disposed of in a controlled manner.

Controlled municipal waste is collected, transported, and disposed of by both

municipalities and private companies. Most controlled municipal waste in Chile is

disposed of in landfills, 75 percent of which are operated by private companies.9

However, many landfills are reported to be poorly constructed, resulting in

environmental contamination. There are three sanitary landfills in Chile: two in the

Santiago Metropolitan Region and one in the city of Rancagua, located 50 miles

south of Santiago.10 In the Santiago Metropolitan Region, two companies—Empresa
7-3

Table 7-1

Selected characteristics of the Chilean solid and hazardous waste services market

Item Solid waste Hazardous waste

Waste generation/treatment An estimated 1.2 billion metric tons

of solid waste is generated per year

(disproportionate amount of which

is mining waste), of which a small

amount is thought to be managed.1

An estimated 600 million metric

tons of hazardous waste is

generated per year (most of which

is mining waste), of which a small

amount is thought to be managed.1

Market size (2000) An estimated $1.4 billion for

equipment and services most of

which is accounted for by the

Santiago Metropolitan Region.2

(

3

)

Trade (2000) Solid waste equipment and

services: exports- none, imports-

$1.4 billion.2

Hazardous waste equipment and

services: exports- none; importsdata not available, but such imports

are thought to be increasing in

conjunction with Chile’s industrial

growth.2

Nature of industry The solid waste industry is

relatively small and primarily

concentrated in the Santiago

metropolitan region, with five

private waste treatment companies

accounting for a majority of the

solid waste services market.4

Three of the top five solid waste

companies handle hazardous

waste.2

 These firms maintain

facilities only in Santiago.4

Key market participants

(and location of parent)

Residential waste- EMERES Ltda.

(Chile) and KDM (U.S.); industrial

waste- Hidronor (Spain) and Bravo

Energy (U.S.).4

Industrial hazardous wasteHidronor (Spain) and Bravo Energy

(U.S.); medical waste- PROCESAN

(Chile).4

Principal methods of waste

treatment and disposal

Landfills account for most

controlled disposition of waste.4

With only two hazardous waste

facilities, both in Santiago, much of

this waste is thought to be dumped

at uncontrolled sites. Medical

waste in Santiago is primarily

incinerated.4

Key regulations The Environmental Framework Law, 1994, provides a general legal basis

for environmental protection.5

 Chile has been working to establish the

necessary legislative framework and regulatory infrastructure for waste

management, particularly hazardous waste, but these measures are not

expected to be enacted until 2008.6

See footnotes at end of table.
 11 Ibid., p. 9.

7-4

Table 7-1—continued

Selected characteristics of the Chilean solid and hazardous waste services market

Item Solid waste Hazardous waste

Regulatory authorities Chile does not have a centralized government agency with legislative and

enforcement authority over environmental issues. Each ministry is

responsible for establishing standards in the sector it regulates, and the

ministries’ regional offices have enforcement responsibility. 

Environmental coordinating agencies include CONAMA and COREMAs.5

GATS commitments Chile has scheduled no GATS commitments on refuse disposal services,

but its commitments on environmental engineering design services grant

limited market access and national treatment for the foreign provision of

such services through cross-border supply and consumption abroad.7

Other measures affecting

trade and investment

Exporters are increasingly required by their foreign customers to achieve

ISO 14000 waste management certification.5

 1 USDOC, US&FCS Research Reports, Chile Environmental Technologies - Solid Waste, by Isabel

Valenzuela, Oct. 13, 2001, p. 2.

 2

 USDOC, US&FCS Research Reports, Chile Country Commercial Guide FY 2003 - Leading Sectors for

U.S. Exports and Investments, by Carlos Capurro, Aug. 28, 2002, p. 3.

 3

 Not available

 4

 USDOC, Chile - Solid Waste Management - Summary - ISA 990901, 1999, pp. 1-7.

 5

 USDOC, International Trade Administration (ITA), Chile - Environmental Technologies Export Market

Plan, May 1998, pp. 6-9, and 23.

 6

 U.K. Trade and Investment, “Environmental Market in Chile,” Opportunities Profile - Mining, p. 4.

 7

 General Agreement on Trade in Services (GATS), Chile: Schedule of Specific Commitments,

GATS/SC/18, Apr. 15, 1994.

Metropolitana de Tratamiento de Residuos Solidos (EMERES) and Kiasa Demarco

S.A. (KDM)—dominate the municipal collection and disposal market. EMERES is

controlled by the mayors of 19 municipalities in the southern part of the Santiago

metropolitan region, and owns and operates the Lepanto sanitary landfill. KDM, a

private company with U.S. investors, owns and operates a transfer station and the

Santiago Region’s other sanitary landfill. KDM reportedly signed a 16-year waste

management contract in 1995 with Cerros de Renca, an organization that represents

20 municipalities in the northern half of the Santiago metropolitan region.

In the Santiago Metropolitan Region, two companies—Hidronor (owned by Belgianbased Machiels) and Bravo Energy Chile S.A. (owned by U.S.-based Bravo Energy

Trading N.A.)—dominate the industrial waste services market. Each company has

one facility to serve the region, both of which are equipped to handle solid and

hazardous industrial waste. There are no known facilities for the management of

hazardous industrial waste outside the Santiago Metropolitan Region.11

Incineration is the primary method of managing medical waste. Procesos Sanitarios

S.A.(PROCESAN) is the only company authorized to dispose of hazardous medical
 12 USDOC, Chile - Solid Waste Management - Summary - ISA 990901, 1999, p. 9.

 13 Ibid., p. 8.

 14 USDOC, International Trade Administration, Chile - Environmental Technologies

Export Market Plan, May 1998, p. 6.

 15 USDOC, US&FCS Research Reports, Chile, Environmental Technologies - Solid Waste,

pp. 2-4.

 16 U.K. Trade and Investment, “Environment Market in Chile,” Crown copyright date 2003,

found at Internet address

http://www.tradepartners.gov.uk/environment/chle/opportunities.shtml, retrieved Nov. 20,

2003.

7-5

waste in Chile. However, the firm’s only facility, which is located in the Santiago

Metropolitan Region, manages only about five percent of all hazardous medical

waste generated in Chile.12

Although recycling is not practiced on a large-scale basis, there is some formal and

informal recycling of aluminum, cardboard boxes, paper, and glass in Chile. 

Individuals collect small volumes of recyclable materials from homes and businesses

and sell these items to small intermediary companies who, in turn, sell them to

companies that recover the materials. Some industries sell recyclable material

directly to intermediaries or to paper and glass producing companies that use

recovered materials as production inputs. However, recycled material is often more

expensive than virgin material,13 reducing the demand for recycled material and

associated services. 

Chile’s efforts to manage its solid and hazardous waste stream may be constrained by

a lack of national standards and regulations that specifically address the collection,

transportation, and disposal of such waste. Chile’s environmental regulatory system

is shaped primarily by its “Environmental Framework Law,” which was enacted in

March 1994. This law provides a general legal basis for environmental protection in

Chile. Key regulatory elements—which apply to solid and hazardous waste

management together with all environmental issues— include a process for

establishing environmental standards, economic mechanisms for implementing

standards (e.g., tradeable permits, pollution charges, and user fees), and mandatory

environmental impact assessments for all major projects or activities.14

Much of the country’s industrial waste is dumped in uncontrolled areas, as many

waste generators simply pay a nominal fee to independent garbage collectors to haul

it away. Chile’s Association of Professionals for the Environment estimated that

only 10 percent of the country’s construction solid waste and 40 percent of its

industrial solid waste are handled in a controlled manner.15 Only Santiago has

established a cradle-to-grave manifest system to track industrial hazardous waste. 

Although the Government of Chile has been working to establish a legislated

standard and regulatory package that specifically addresses the collection,

transportation, and disposal of solid waste, medical waste, and industrial hazardous

waste at the national level, business concerns and a lack of resources have stalled the

effort. The Chilean Government estimates that it could take another five years to

establish a national regulatory structure for industrial solid and hazardous waste

management.16 Chile also has not established national regulations regarding the

management of solid and hazardous mining waste. However, starting around 1998,

government agencies and mining companies drafted proposed regulations and
 17 U.K. Trade and Investment, “Environment Market in Chile.” 

 18 USDOC, International Trade Administration, Chile - environmental Technologies Export

Market Plan, pp. 6-9.

 19 USDOC, US&FCS Research Reports, Solid Waste Management, by Isabel Valenzuela,

Oct. 1, 2002, p. 2, found at Internet address

http://www.s...penDocument&sessID=90BB044D2903021/, retrieved Apr. 29, 2003.

 20 The ISO series was developed to provide businesses with a structure for managing

environmental impacts, and confers a “stamp of approval” on a company’s environmental

practices.

 21 USDOC, International Trade Administration, Chile - Environmental Technologies

Export Market Plan, p. 24.

7-6

voluntary “good practice” standards for adoption by Chile’s mining industry. These

measures, which are designed to safeguard the environment in mining areas, are

generally enforced by waste generators themselves.17

There is no central government agency with legislative and enforcement authority

over environmental issues in Chile. Under the auspices of the Environmental

Framework Law, the National Environmental Commission (CONAMA) was

established to coordinate the country’s environmental policies. CONAMA’s Council

of Directors is composed of the General Secretary of the Presidency and the heads of

each of the government’s 11 ministries, including the Ministries of Health, Public

Works, Mining, and Agriculture. In addition to this national coordinating agency,

there are similar agencies for each of Chile’s 12 regions called the Regional

Environmental Commissions (COREMA). Each COREMA includes the regional

governor and the regional representative of each of the 11 ministries. To ensure

coordination of national and regional policies, the director of each COREMA also

serves on the executive unit of CONAMA. However, neither CONAMA nor the

COREMAs have the authority to enforce environmental regulations. Instead,

CONAMA can suggest that a ministry take a particular course of action to correct a

problem within its specific jurisdiction. Likewise, the COREMAs rely on the

regional ministries to handle the enforcement of regulations.18

In addition to the regulatory environment, factors affecting the demand for solid

waste management services in Chile include economic growth, increased industrial

production, and rising consumption in the 1990s. Taken together, these factors

resulted in a rapid increase in the generation of solid and hazardous waste. Other

factors that have produced some measure of demand for solid and hazardous waste

management services include the implementation of environmental education

programs that have raised environmental consciousness, particularly among the

university population,19 and the development of international trade relationships. The

latter is particularly important, as businesses interested in exporting are increasingly

required by potential international trade partners to adopt and become certified in

international environmental management standards such as the International

Standardization Organization’s (ISO’s) 14000 series.20 Such requirements may

increase demand for environmental services—including solid and hazardous waste

services—among Chilean exporters.21
 22 Ibid., pp. 20-23.

 23 General Agreement on Trade in Services (GATS), Chile: Schedule of Specific

Commitments, GATS/SC/18, Apr. 15, 1994.

 24 U.S. Trade Representative, 2003 National Trade Estimate Report on Foreign Trade

Barriers, pp. 43-45.

 25 USDOC, International Trade Administration, Egypt - Environmental Technologies

Export Market Plan, Feb. 1999, pp. 21-22.

 26 USDOC, US&FCS Market Research Reports, Egypt - Environmental Equipment and

Services, by Heba Abdel Aziz, June 8, 2003, pp. 4-5, found at Internet address

http://www.stat-usa.gov/mrd.nsf/vwISA_Country/016F8FEED4C3B/, retrieved Aug. 26, 2003.

7-7

Trade and Investment

Although data on trade and investment in the Chilean waste management market do

not exist, it is likely that Chile imports some solid and hazardous waste services

through the foreign-owned waste management affiliates that have established a

presence in the Chilean market. Foreign investment in Chilean waste management

facilities includes Belgium-based Hidronor’s $25 million industrial and hazardous

waste plant,22 and a similar facility owned by U.S.-based Bravo Energy Trading. 

Japan established a channel for its companies to actively pursue opportunities in the

Chilean market by helping to finance a preliminary study on industrial solid waste in

the late 1990s.

Chile has made no commitments on refuse disposal services under GATS, and its

commitments on environmental engineering design services grant limited market

access and national treatment for the foreign provision of such services through

cross-border supply and consumption abroad.23 In addition, Chile’s GATS schedule

indicates that authorization of foreign investment in service industries may be

contingent on such factors as employment generation and the use of local inputs. 

Much like the GATS, the U.S.-Chile Free Trade Agreement (FTA) covers both crossborder supply of services and the right to invest and establish a local presence in a

wide range of service sectors including environmental services, construction, and

engineering. The U.S.-Chile FTA will protect all forms of investment and would

remove certain restrictions on U.S. investors, such as requirements to buy Chilean

inputs.24 

Egypt 

Market Overview

Industry sources estimate that Egypt’s market for municipal and industrial waste

management (goods and services) totaled $40 million in 1998, with the hazardous

waste management segment accounting for an estimated $30 million of the total.25 It

was estimated that 20-30 million metric tons of municipal and industrial solid waste

and 100,000-300,000 metric tons of hazardous waste were generated in 2000 (table

7-2).26 Egypt’s primary solid and hazardous waste generating industries include
7-8

Table 7-2

Selected characteristics of the Egyptian solid and hazardous waste services market

Item Solid waste Hazardous waste

Waste

generation/treatment

An estimated 20-30 million metric

tons of solid waste was generated

in 2000, little of which is believed to

be managed.1

Approximately 100,000 to 300,000

metric tons of hazardous industrial

waste and about 20,000 metric

tons of hazardous medical waste

are generated per year; little of

either type of waste is thought to

be managed.1

Market size (1998) Approximately $10 million (goods

and services).2

Approximately $30 million (goods

and services).2

Trade Egypt is likely a net importer of solid

waste services.2

Egypt is likely a net importer of

hazardous waste services.2

Nature of industry The overall environmental services industry is small and relatively new due

to the recent establishment of the Egyptian Environmental Affairs Agency

(EEAA) in 1994,2

 followed by the establishment of the Ministry of State for

Environmental Affairs in 1997.1

Key market participants

(and location of parent)

Municipal authorities tend to

dominate the managed waste

market, although they plan to

transfer operations to the private

sector.2

 French-based Onyx does

provide landfill services at one

facility near Alexandria.3

The controlled waste market is not

fully developed and a dominant

participant has not emerged.4

Principal methods of waste

treatment and disposal

Municipal waste is disposed of in

unlined open dumps; waste also

may be open-air burned to reduce

the volume.2

There are no disposal facilities for

hazardous industrial waste in

Egypt, and such waste is typically

managed in the same manner as

nonhazardous industrial waste. 

Health waste is generally open-air

burned or disposed of in unlined

dumps.2

Key regulations Environmental Conservation Law 4/19942

Regulatory authorities Egyptian Environmental Affairs

Agency.2

Egyptian Environmental Affairs

Agency. Line ministries issue

hazardous waste licenses for

relevant industry (i.e., Ministry of

Industry, Agriculture, etc.).2

See footnotes at end of table.
 27 U.S. Central Intelligence Agency, The World Factbook - Egypt, Aug. 2003, p. 9, found at

Internet address http://www.cia.gov/publications/factbook/geos/eg.html, retrieved Nov. 3,

2003.

 28 Ministry of State for Environmental Affairs, Egyptian Environmental Affairs Agency,

“Achievements and Planned Activities-- Solid Waste Management,” found at Internet address

http://www.eeaa.gov.eg/English/main/accomp4.asp/, retrieved Dec. 4, 2003; and Support for

Environmental Assessment and Management (SEAM) Organization, “Solid Waste

Management Strategy for Dakahleya Governorate,” case study dated 1999, found at Internet

address wwwseamegypt.com/Manuals/DakahSolidWaste/content/html/, retrieved Dec. 4, 2003.

 29 USDOC, International Trade Administration, Egypt - Environmental Technologies

Export Market Plan, p. 21.

7-9

Table 7-2—continued

Selected characteristics of the Egyptian solid and hazardous waste services market

Item Solid waste Hazardous waste

GATS commitments Egypt scheduled no GATS commitments on refuse disposal

services. Egypt’s GATS schedule lists restrictions on other service

sectors that may affect the foreign provision of refuse disposal

services, including limits on commercial presence (allows only joint

ventures) and limits on foreign equity.5

Other measures affecting

trade and investment

Exporting firms are increasingly required by their foreign customers to

achieve ISO 14000 waste management certification.2

 1 Calculated by Commission staff from USDOC, US&FCS Market Research Reports, Egypt -

Environmental Equipment and Services, by Heba Abdel Aziz, June 8, 2003, pp. 3-5.

 2

 USDOC, International Trade Administration, Egypt - Environmental Technologies Export Market Plan,

Feb. 1999, pp. 5-8, 21-22, and 24-25.

 3

 Cam McGrath, “Raising a Sink,” Egypt Today, Aug. 2003.

 4

 Research has uncovered no evidence regarding the activities of specific firms in Eqypt’s hzardous

waste services sector.

 5

 General Agreement on Trade in Services (GATS), Egypt: Schedule of Specific Commitments,

GATS/SC/30, Apr. 15, 1994.

metal foundries, chemicals and petrochemicals, electroplating, and textiles.27

Anecdotal evidence suggests that very little of the solid and hazardous waste

generated in Egypt is treated or disposed of in a controlled environment.28

Municipal waste collection primarily has been a public sector responsibility, with the

reliability of service varying from location to location depending on economic

conditions. Large-capacity trucks are used in relatively affluent areas that can afford

this service, while small vehicles such as pickup trucks and pull carts are typically

used in poor urban neighborhoods and rural areas. There are few if any engineered

sanitary landfills in Egypt, and many operators of unlined open dumps burn waste to

reduce the volume.29 Although prohibited by law, waste is often burned in open

spaces. 
 30 Ibid., p. 22.

 31 USDOC, US&FCS Market Research Reports, Egypt - Environmental Equipment and

Services, p. 5.

 32 Ibid., P. 24.

 33 Ibid., p. 5.

 34 USDOC, International Trade Administration, Egypt - Environmental Technologies

Export Market Plan, p. 25.

 35 Ibid., pp. 22-23.

7-10

Industrial and hazardous waste collection and disposal are arranged by wastegenerating firms. Owing to a lack of hazardous waste management facilities, such

waste is generally mixed with industrial solid waste and disposed of in open dumps.30

Open burning and dumping are the prevailing methods for disposing of medical

waste. Estimates suggest that a $350-million investment would be needed to

properly manage hazardous waste produced by Egyptian medical facilities, reduce

waste-borne diseases and ailments, and establish a database on the quantity and

composition of hazardous medical waste generated in Egypt.31

Despite the relatively small size of Egypt’s waste management market, there is a 

growing push to control its solid and hazardous waste generation as evidenced in

recent regulatory developments. Egypt’s current regulatory framework for solid and

hazardous waste management is based on the “Law for the Environment” (Law 4

enacted in 1994). This legislation provides for the development of standards,

monitoring systems, environmental impact assessments, and enforcement

mechanisms with respect to both air pollution and solid and hazardous waste. The

legislation also prohibits the dumping, treating, or burning of solid waste in

unauthorized locations, and established the Egyptian Environmental Affairs Agency

(EEAA) as the national implementing authority. However, EEAA shares its waste

management responsibilities with as many as 15 sectoral ministries—including the

Ministry of Health, Ministry of Industry and Mineral Resources, and Ministry of

Housing, Utilities, and New Communities—which has reportedly made it difficult to

develop and implement a national, integrated solid and hazardous waste management

plan.

Factors that may affect the provision of solid and hazardous waste services in Egypt

include municipal government plans to transfer management operations to private

enterprises in an effort to improve efficiency,32 and Federal Government plans to

develop waste control programs in cooperation with businesses, nongovernment

organizations, and consumer groups.33 One incentive spurring demand for solid and

hazardous waste management services in Egypt is the growing pressure on exporting

businesses to adopt and become certified in established environment management

standards such as ISO 14000 series.34 In addition, a number of development agencies

have made funds available for the clean-up and protection of Egypt’s environment,

including the International Bank for Reconstruction and Development (IBRD), the

Danish International Development Agency (DANIDA), and the Finnish International

Development Agency (FINNIDA). For example, FINNIDA funded a waste

management system and a licensed landfill in Alexandria for the collection,

treatment, and disposal of certain types of industrial hazardous waste. IBRD

supports pollution abatement investments in Cairo, Alexandria, Suez, and Ismailia.35

Moreover, DANIDA completed a feasibility study for an industrial hazardous waste
 36 USDOC, US&FCS Market Research Reports, Egypt - Environmental Equipment and

Services, p. 4.

 37 Cam McGrath, “Raising a Sink,” Egypt Today, Aug. 2003, found at Internet address

http://www.egypttoday.com/issues/0308/, retrieved Dec. 10, 2003. 

 38 Finland Ministry of Foreign Affairs, Projects in Egypt 1999, found at

http://global.finland.fi/english/projects/countries/egypt.htm/, retrieved Dec. 12, 2003; and

International Consulting Services of the Finnish Environment Institute (SYKE), List of All

Projects, found at Internet address

http://www.vyh.fi/eng/intcoop/projects/consult/allproje.htm/, retrieved Dec. 17, 2003. 

 39 SCS Engineers, “Phase I: Solid Waste Privatization Assistance-- Alexandria, Egypt,

2002,” found at Internet address

http://www.scsengineers.com/InternationalProjects_SWP_PIEgypt.html/, retrieved Dec. 4,

2003.

 40 General Agreement on Trade in Services (GATS), Egypt: Schedule of Specific

Commitments, GATS/SC/30, Apr. 15, 1994.

7-11

management project in Cairo and FINNIDA is funding an ongoing project for the

integrated management of dump sites.36

Trade and Investment

Although data on the extent of foreign trade and investment in Egypt are not readily

available, there is evidence that several foreign-owned companies provide solid and

hazardous waste management services in the market. As of 2001, Onyx SA, a

subsidiary of French-based Veolia Environment, provided waste collection services

and landfill management in Egypt.37 During 1999-2002, Finland-based Plancenter

Ltd. reportedly provided consulting services for developing the FINNIDA hazardous

waste management project in Alexandria, Egypt, discussed above; this project is

pending approval by appropriate government authorities.38 Also, U.S.-based SCS

Engineers helped the governorate of Alexandria, Egypt to develop a privatization

program for its solid waste management and public cleaning system. This project

consisted of developing a solid waste management and monitoring system, preparing

tender evaluation criteria, developing scenarios for the unbundling of services,

preparing the contract and a framework for implementing the project, establishing a

financial model for determining the least cost and present value of each component of

the solid waste and public cleaning system, and developing a contract monitoring

plan.39

Although Egypt was an active participant in the Uruguay Round negotiations on

services, it made no commitments on refuse disposal services under the General

Agreement on Trade in Services (GATS). Egypt’s GATS schedule lists restrictions

on other service sectors that may affect the foreign provision of refuse disposal

services, including limits on commercial presence (allows only joint-venture

companies) and limits on foreign equity.40
 41 Includes gold, platinum, and chromium mining.

 42 USDOC, US&FCS Market Research Reports, South Africa - Waste Management, by

Averil Millard, Oct. 1, 2002, pp. 3-4, found at Internet address

http://www.s...penDocument&sessID=8017042029832F9/, retrieved Apr. 29, 2003.

 43 U.S. Central Intelligence Agency, The World Factbook - South Africa, Aug. 2003, p. 7,

found at Internet address http://www.cia.gov/publications/factbook/geos/eg.html/, retrieved

Nov. 3, 2003.

 44 U.K. Trade and Investment, “Environment Market in South Africa,” Crown copyright

2003, found at Internet address

http://www.tradepartners.gov.uk/environment/south_africa/profile/overview.shtml/, retrieved

Nov. 20, 2003.

 45 USDOC, US&FCS Market Research Reports, South Africa - Waste Management,

pp. 2-3. 

 46 Ibid., p. 5.

 47 USDOC, International Trade Administration, South Africa - Environmental Technologies

Export Market Plan, Oct. 1998, p. 17.

7-12

South Africa

Market Overview

Although data reflecting the size of South Africa’s solid and hazardous waste

services market are not available, industry sources estimate that the country generated

approximately 560-600 million metric tons of solid and hazardous waste in 2001

(table 7-3). The mining sector41 alone is thought to account for 450-500 million

metric tons, or 80 percent, of South African waste generation.42 Manufacturing

industries that generate a significant amount of waste in South Africa include

metalworking, machinery, iron and steel, and chemicals.43 Anecdotal evidence

suggests that very little of the solid and hazardous waste stream in South Africa is

treated or disposed of in a controlled manner.44

Over half of South Africa’s communities do not have access to waste collection

services, and municipal waste collection, where it exists, is reportedly irregular. 

Most collected waste is reportedly disposed of in landfills. There are about 540

known landfill operations in South Africa, 61 percent of which operate under

permits. However, industry sources estimate that there could be as many as 15,000

landfill sites in the country. A number of small communities burn waste in

incinerators. The siting, construction, and operation of these small-scale incinerators

was accomplished to serve an urgent need with little apparent regard for

environmental impact.45

There is very little information concerning the management of industrial solid and

hazardous waste in South Africa. One hazardous waste landfill at Holfontein

reportedly serves the Gauteng, Mpumalanga, Free State, Northwest, and Northern

provinces. Hazardous waste facilities reportedly also exist in Western Cape, Kwa

Zulu-Natal, and Eastern Cape.46 Solid waste from mining generally is deposited on

tailing heaps or is used to backfill mines and rehabilitate sites.47 With regard to

medical waste, on-site incineration by hospitals is the prevailing method of disposal. 

For example, in the Province of Gauteng, there are 54 small-scale incinerators in 
7-13

Table 7-3

Selected characteristics of the South African solid and hazardous waste services market

Item Solid waste Hazardous waste

Waste

generation/treatment

South Africa produced an estimated

560-600 million metric tons of solid

waste in 2001, some of which was

disposed of at controlled sites.1

(

2

)

Trade (2000) South Africa may be a net importer

of solid waste services.3

South Africa may be a net importer

of hazardous waste services.3

Nature of industry A very small industry in its first

stages of development, responding

to pressing needs on a reactionary

basis. Despite the availability of

equipment, South Africa does not

have a waste management system

and thus lacks an organized waste

disposition service.1

South Africa’s hazardous waste

services industry is likely very small

or nonexistent.4

Key market participants

(and location of parent)

Municipal authorities tend to

dominate controlled waste

management through landfill

ownership.5

 French-based Onyx

has recently established a

subsidiary in South Africa which

manages solid waste.6

French-based Onyx has recently

established a subsidiary in South

Africa which may have the capacity

to manage hazardous waste.6

Principal methods of waste

treatment and disposal

Landfills account for the largest

share of controlled waste

disposition, followed by some

recycling conducted by private

companies that generate the waste,

and a minor amount of composting

by private entrepreneurs. Mining

waste is disposed on-site at tailing

dams and mine dumps.1

Controlled health waste is disposed

through incineration. Other

hazardous waste tends to be

disposed of in landfills or

unregulated dumps.1

Key regulations Environmental Conservation Act7

and the White Paper on Integrated

Pollution and Waste Management.

However, neither of these statutes

have been implemented by formal

proclamation.1

There is no legislation that directly

applies to hazardous waste

management.7

Regulatory authorities Department of Environmental Affairs and Tourism, Department of Water

Affairs and Forestry, and Department of Health.7

See footnotes at end of table.
 48 USDOC, US&FCS Market Research Reports, South Africa - Waste Management,

 pp. 7-8.

7-14

Table 7-3!continued

Selected characteristics of the South African solid and hazardous waste services market

Item Solid waste Hazardous waste

GATS commitments GATS commitments grant full market access and national treatment to

foreign providers of refuse disposal services through cross-border supply

(mode 1), consumption abroad (mode 2), and commercial presence (mode

3). South Africa’s GATS schedule lists restrictions in other services that

may affect the foreign provision of refuse disposal services, including

technical limitations on market access and national treatment through

cross-border supply for general construction work for civil engineering and

limitations on the size of building plans for market access through crossborder supply and consumption abroad.8

Other measures affecting

trade and investment

Exporting businesses are increasingly required by their foreign customers

to achieve ISO 14000 waste management certification.7

 1 USDOC, US&FCS Market Research Reports, South Africa - Waste Management, by Averil Millard,

Oct. 1, 2002, p. 1-15.

 2

 Not available.

 3

 Anecdotal evidence indicated that at least one foreign owned firm is providing waste management

services in South Africa. Research has uncovered no evidence of South African firms providing waste

management services in foreign markets. Onyx South Africa Waste Management Services website, home

page, found at Internet address http://www.onyxsa.com, retrieved Nov. 21, 2003.

 4

 Research has uncovered evidence of one firm that may provide hazardous waste services in South

Africa. Onyx South Africa Waste Management Services website, home page, found at Internet address

http://www.onyxsa.com, retrieved Nov. 21, 2003.

 5

 The World Bank, Urban Development Division, Waste Management Anchor Team, Observations of

Solid Waste Landfills in Developing Countries: Africa, Asia, and Latin America, by Lars Mikkel

Johannessen with Gabriel Boyer, June 1999, p. 11.

 6

 Onyx South Africa Waste Management Services website, home page, found at Internet address

http://www.onyxsa.com, retrieved Nov. 21, 2003.

 7

 USDOC, International Trade Administration, South Africa - Environmental Technologies Export Market

Plan, Oct. 1998, p. 4, 7, and 9.

 8

 General Agreement on Trade in Services (GATS), South Africa: Schedule of Specific Commitments,

GATS/S/78, Apr. 15, 1994.

operation. Non-burn technologies reportedly are being introduced as an alternative to

the existing incinerators, possibly as a result of public pressure to address air

pollution concerns.48

There is very little recycling activity in South Africa because the cost of recovered

materials is frequently higher than that of new materials. However, some recycling

initiatives that were developed on an adhoc basis with private sector funding have

met with some success. Paper and fiber recycling is fairly well-developed and is

controlled by SAPPI, Mondi, and Nampak, South Africa’s three largest paper

companies. Steel and aluminum cans are recycled by a company called Collect-aCan, which has a detinning facility in Gauteng Province. Owing to the availability of

recyclable materials at landfills, informal salvaging is widespread. Informal

recycling is particularly common in undeveloped areas, where some waste is
 49 Ibid., pp. 5-7.

 50 USDOC, International Trade Administration, South Africa - Environmental Technologies

Export Market Plan, p. 9.

 51 Ibid.

 52 U.S. Central Intelligence Agency, The World Factbook - South Africa, p. 6. 

 53 Industry representative, interview by USITC staff, Washington, DC, Nov. 12, 2003.

 54 Onyx South Africa Waste Management Services web site, home page, found at Internet

address http://www.onyxsa.com/, retrieved Nov. 21, 2003.

7-15

converted into useable household items such as bags, mats, and toys. Composting is

also conducted on an informal basis by private entrepreneurs.49 

South Africa does not have a central government agency with regulatory and

enforcement authority over environmental issues. Since the dismantling of apartheid

in 1994, the Government of South Africa has made some preliminary efforts to

improve the legal and regulatory framework for environmental management. For

example, the new constitution emphasizes the importance of environmental health

and welfare, pollution control, nature conservation, and sustainable social and

economic development. Also, the Department of Environmental Affairs and Tourism

published the White Paper on Environmental Management Policy for South Africa in

May 1998 and a draft National Environmental Management Bill in June 1998,

currently pending approval.50 In the meantime, the Government of South Africa is

using pre-1994 environmental regulations in order to meet immediate needs. South

Africa has a large body of environmental protection legislation on the books,

including the country’s major environmental law, the Environment Conservation Act,

and more than 30 statutes covering land-based pollution. However, these have never

been effectively implemented.51

Other factors that limit demand for solid and hazardous waste services in South

Africa include pressing social and economic issues such as the high unemployment

rate and growing HIV/AIDS infection rates. In addition, substantial economic

problems remain from the apartheid era, most notably the high level of poverty (an

estimated 33 percent of households) and the lack of economic empowerment among

disadvantaged groups.52 As long as these issues remain top government priorities,

efforts to address environmental problems may not garner a substantial amount of

scarce public resources.53 Nevertheless, domestic businesses’ interest in exporting

may stimulate the demand for solid and hazardous waste management services in

South Africa, as trade partners are increasingly pressing exporters to adopt and

become certified in established environment management standards such as the ISO

14000 series.

Trade and Investment

Evidence suggests that foreign participation in the South African solid and hazardous

waste management market is limited. French-based Veolia Environment has recently

established a solid and hazardous waste subsidiary in South Africa called Onyx South

Africa Waste Management Services.54 Weston Solutions, Inc., a U.S.-based waste

management company, in partnership with Peacock Bay Environmental Services, a

South African-based waste management company, recently concluded a two-year

business development program in South Africa. However, the waste management
 55 Pre-hearing written submission, Michael T. Werner, Esq., Client Services Manager,

Weston Solutions, Inc., Oct. 6, 2003; and industry representative, interview by USITC staff,

Washington, DC, Nov. 12, 2003.

 56 General Agreement on Trade in Services (GATS), South Africa: Schedule of Specific

Commitments, GATS/SC/78, Apr. 15, 1994. 

 57 U.K. Trade and Investment, “Environment Market in Chile.” 

7-16

proposal put forward by Weston and Peacock at the end of this program was not

accepted, likely due to South Africa’s resource constraints. In retrospect, the hightechnology program offered in Weston’s original proposal may have been out-ofreach for the newly emerging South African waste management market. One

industry representative observed that South Africa’s leadership is in the difficult

situation of deciding which critical public needs to fund with very scarce public

resources in order to achieve the greatest public benefit in the least amount of time.55

South Africa’s commitments on refuse disposal services under the GATS grant full

market access and national treatment for the foreign provision of such services

through cross-border supply, consumption abroad, and commercial presence. South

Africa’s GATS schedule lists restrictions in other services that may affect the foreign

provision of refuse disposal services, including technical limitations on market access

and national treatment through cross-border supply for general construction work for

civil engineering, as well as limitations on the size of building plans for market

access through cross-border supply and consumption abroad.56

Future Prospects

Solid and hazardous waste services markets in Africa, Latin America, and the Middle

East are modest in both relative and absolute terms. Chile, Egypt, and South Africa,

which are considered regional leaders, are just beginning the process of assessing the

full economic burdens associated with a lack of effective environmental legislation,

regulation, and enforcement. As regulations and enforcement become more robust,

the growth of industrial activity with its attendant solid and hazardous waste

management issues will likely expand at a rate slightly greater than the growth of

domestic waste management capacity. During this developmental phase, these

countries will likely be net importers of services, equipment, and capital to

implement solutions toward achieving adequate standards of solid and hazardous

waste management.

Chilean efforts to address the treatment and disposal of solid and hazardous waste are

expected to result in the construction of additional certified sanitary landfills to meet

growing demand for waste disposal capacity. This increase in demand is driven by

the pending approval of regulations pertaining to the management of industrial and

hazardous waste, the country’s goal to dispose of 80 percent of all solid waste in

certified sanitary landfills, and the adoption of ISO standards and certification

protocols by Chilean exporters.57

Egyptian Decree 338/1995 requires the licensing of hazardous waste generation,

collection, storage, transport, treatment, and disposal operations. This action

establishes a framework for the foreign provision of hazardous waste management
 58 USDOC, International Trade Administration, Egypt - Environmental Technologies

Export Market Plan, p. 6.

 59 Egyptian Environmental Policy Program, found at Internet address

http://www.greencom.org/greencom/papers.asp?type=country&letter=E/, retrieved Dec. 4,

2003.

 60 U.S. Embassy in Cairo, “U.S., Egypt Put Hazardous Waste Management into Action,”

press release, July 13, 2003, found at Internet address

http://cairo.usembassy.gov/usis/pr071303.html/, retrieved Dec. 4, 2003.

 61 Vernon Mchunu, “World Bank Project Will Draw Power From Trash,” The Mercury,

Jun. 27, 2003, found at Internet address

http://www.iol.co.za/index.php?click_id=13&art_id=vn2003062703..., retrieved Dec. 4, 2003.

 62 John Sutter, “Fixing a Tyred Environment,” Apr. 6, 2003, found at Internet address 

http://www.news24.com/News24/South_Africa/News/0,,2-7-1442..., retrieved Dec. 4, 2003.

7-17

services.58 Further, the establishment and maturing of regional branch offices of the

Egyptian Environmental Affairs Agency, as well as increasing standardization in

planning cycles, work plans, budgets, operating procedures, and staff skill levels,

should enhance opportunities in the Egyptian waste management market.59 Lastly,

the completion of a $1.3 million USAID-funded project to develop guidelines for the

classification and safe handling of hazardous wastes and a system to license entities

that generate, handle, or dispose of such waste will likely provide a common

structure for managing hazardous wastes and create commercial opportunities for

waste management firms.60

It appears that near-term trade opportunities in South Africa’s solid and hazardous

waste management market are somewhat limited owing to a variety of resource

constraints. However, there may be selected opportunities for developing niche

waste management markets. For example, the World Bank has initiated a pilot

project to harness methane gas emissions from three landfills in Durban to use in the

generation of electricity. Development of the project is anticipated to start sometime

in 2004, following an environmental impact assessment.61 The recycling of tires,

which is reportedly required by the Department of Environmental Affairs and

Tourism, is also expected to provide additional market opportunities in the solid and

hazardous waste services sector.62

 1

 Municipal solid waste generation rates are used in this comparison, as the definition of

municipal solid waste tends to be more comparable across countries than definitions of other

waste streams.

 2

 The World Bank Group defines lower-middle income countries (China, Egypt, and South

Africa) as those with per capita GDP of $736– $2,935, upper-middle income countries (Chile,

Czech Republic, Malaysia, and Mexico) $2,936– $9,075, and high income (Australia, Canada,

European Union, Japan, and United States) $9,076 or more. Municipal waste generation data

were not available for Australia, Canada, Egypt, Malaysia, or South Africa.

8-1

CHAPTER 8

SUMMARY

A cross-country comparison of the information presented throughout this report

suggests that there is a significant relationship between income and the characteristics

of national solid and hazardous waste services markets. Among the countries

discussed in this report, high-income economies typically generate more solid waste

than middle-income economies. High-income countries manage a greater share of

their waste, are more likely to employ modern waste management techniques, and are

more likely to maintain and enforce strict waste management regulations than

developing economies. Trade and investment in the solid and hazardous waste

services sector is also more prevalent among developed economies than developing

countries. However, some market characteristics, including hazardous waste

generation and private participation in hazardous waste management markets, may be

unrelated to per capita income levels.

This chapter provides an overview of the country-specific information presented in

the preceding chapters, and compares this information in an effort to identify trends

in the global markets for solid and hazardous waste services and in the provision of

such services across national borders.

Market Conditions

Solid Waste Management

An analysis of the information presented in this investigation suggests that highincome countries tend to generate more solid waste than developing countries (table

8-1). A direct comparison of per capita municipal solid waste1

 generation rates and

per capita income levels across the subject countries indicates that there is a positive

relationship between waste generation and income: waste generation tends to grow as

per capita income increases (figure 8-1). Thus, for example, middle-income

economies such as China, Chile, the Czech Republic, and Mexico are observed as

generating less waste per capita than high-income countries.2 The stringency

and enforcement of solid waste management regulations also seem to be

closely related to per capita income levels. 
8-2

Table 8-1Characteristics of selected solid waste marketsCountry

Waste generation and

share managed

Principal treatment

methods

Extent of private

participation

Market

competitiveness

Australia 14.4 million metric tons per

year, 95 percent of which ismanaged.

Mostly landfilling andrecycling.

Private sector dominates. Competitive and

moderatelyconcentrated market: top 4 firms account for57 percent ofrevenues (includessolid and hazardouswaste segments).

Canada 31.4 million metric tons in 2000;

most of which was managed.

Landfilling andincineration (73percent, combined);recycling (24 percent).

Private sector dominates. Mature market but not

highly concentrated;number of firms hasgrown in recent yearsas public-sectorprovision of serviceshas decreased.

Chile 9.3 million metric tons of

municipal and industrial solidwaste per year, over half ofwhich is managed.1.2 billion metric tons of miningwaste per year, little of which ismanaged.

Mostly landfilling andopen dumping.

Public sector dominatesthe overall market; privatecompanies dominatecollection in SantiagoMetropolitan Region andsanitary landfilling.

Evolving market, verycompetitive with lowoverall marketconcentration, thoughsanitary landfill marketconcentrated among4-5 companies.

China 160 million metric tons of

municipal solid waste per year;45-50 percent of which ismanaged.950 million metric tons ofindustrial solid waste per year;85 percent of which isreportedly managed.

For municipal waste:landfilling (45 percent)and open dumping (55percent).For industrial waste:recycling (53 percent),storing (32 percent),and landfilling (18percent).

Public sector dominates. Evolving market is

highly fragmented anddecentralized; manymunicipalities regardwaste management asa free public service.
8-3

Table 8-1–continuedCharacteristics of selected solid waste marketsCountry

Waste generation and

share managed

Principal treatment

methods

Extent of private

participation

Market

competitiveness

Czech Republic 26.9 million metric tons in 2002;

most of which was managed.

Landfilling (21 percent),and recycling (20percent).

Private sector dominates; municipalities generallykeep a minority interest inservice providers, whilelarger cities commissionturnkey contractors.

Evolving, competitivemarket.

Egypt 20-30 million metric tons per

year; a small portion of which isbelieved to be managed.

Mostly open dumping. Public sector dominates,

but government plans totransfer operations toprivate sector. 

Few privatecompaniesprimarily becauseEgypt has limitedresources for wastemanagement. 

European Union Approximately 2.2 billion metric

tons per year in WesternEurope during 1998-2001; mostof which was believed to bemanaged.

Mostly landfilling; someincineration, recycling,and composting.

Public sector dominates,though the private sectorwill likely account for alarger market share in thefuture.

Mature market, highlycompetitive. 

Japan 238.4 million metric tons per

year; most of which ismanaged.

Incineration (75percent).

Private sector dominates. Mature market, highly

competitive.

Malaysia 5.5 million metric tons per year;

an estimated 45 percent ofwhich is managed.

Open dumping (50percent), landfilling (30percent).

Private sector willdominate uponcompletion of privatization in 2004.

Evolving market; 3companies control 75percent of market.
Table 8-1–continued

Characteristics of selected solid waste marketsCountry

Waste generation and

share managed

Principal treatment

methods

Extent of private

participation

Market

competitiveness

8-4

Mexico At least 31 metric million tons

per year, an estimated majorityof which is managed.

Mostly landfilling. Public sector dominates;

limited privateparticipation by Mexicanowned firms.

Evolving market ishighly fragmented anddecentralized; manymunicipalities regardwaste management asa free public service.

South Africa Estimated 560-600 million

metric tons per year, little ofwhich is believed to bemanaged.

Mostly landfilling. Most landfills are publicly

owned but privately operated.

Evolving market withfew companies operating, primarilybecause South Africahas limited resourcesfor wastemanagement.
Table 8-1–continued

Characteristics of selected solid waste marketsCountry

Waste generation and

share managed

Principal treatment

methods

Extent of private

participation

Market

competitiveness

8-5

United States 208 million metric tons1 in 2001;

100 percent of which wasmanaged (total excludesconstruction and demolitionwaste, believed to account foran additional 34-69 milliontons).

Landfilling (55 percent),recycling (30 percent),waste-to-energy (15percent).

Private sector dominates(69 percent of sectorrevenues) .

Mature market, highlyconsolidated; 3 largestfirms serving themarket accounted for47 percent ofrevenues in 2001,though 2002 dataindicate that 11,200 firms providedservices in this market.

1 Total does not include municipal sludges; industrial nonhazardous wastes; construction and demolition debris; and agricultural, oil a

wastes. Industry estimates for solid waste generation, which include data for certain municipal solid waste as well as solid waste exclude

exceeded 363 million metric tons in 2001. These industry estimates were generated using methodologies that are substantially different by EPA.Source: Compiled by the U.S. International Trade Commission from various primary and secondary sources. For more specific informaticountry-specific tables presented in chapters 3-7.

8-7

High-income countries typically manage a larger share of their solid waste

streams than developing countries. Solid waste management tends to begin with

open dumping and/or burning, before shifting to controlled disposal technologies

such as landfilling, incineration, and recycling. Middle-income countries usually

employ some combination of these methods with a greater propensity toward open

dumping and landfilling, though recycling of industrial solid waste to recover

precious metals or other valuable materials is common. High-income countries

typically employ sanitary landfilling, incineration, and recycling, with the former

being the most prevalent waste treatment option. The composition often varies

according to resource restrictions and/or cultural biases. For example, because

Australia has ample land and a public aversion to incineration, most of its waste is

landfilled or recycled. Conversely, in Japan land is very expensive and in short

supply, so most waste is incinerated. Recycling rates tend to increase with waste

generation rates, particularly in high-income countries. Recycling is typically

undertaken by the private sector as such efforts must be undertaken on a large scale

in order to be profitable. Municipalities do not always have, or are unwilling to

expend, the resources to maintain such operations and often contract out recycling

activities to private firms, or rely upon market forces to prompt private firms to take

initiative. 

In high-income countries, the solid waste management industry tends to be

dominated by private firms, even though the responsibility for proper waste disposal

may ultimately fall upon public agencies. In many middle-income countries, waste

removal is still considered a free public service that state and local governments

undertake themselves. A lack of privatization laws and public unwillingness or

inability to pay for more efficient trash collection and disposal have made it difficult

for some developing countries to introduce private sector participation into the waste

management sector. In Japan, the United States, Canada, and many European Union

countries, solid waste markets are mature and highly concentrated, thereby making

market entry more challenging. Countries like Mexico, China, and the Czech

Republic may ultimately provide more market opportunities owing to high levels of

unmet demand, though new ventures may be exposed to higher risk levels.

Hazardous Waste Management

It is not possible to formulate definitive conclusions based on cross-economy

comparisons of hazardous waste generation rates, as the definition of hazardous

waste often differs substantially from country to country. However, the information

presented in table 8-2 suggests that total hazardous waste generation in a given

country may not be closely related to a country’s level of development. Both highincome countries and middle-income countries rank among the largest (Chile and

Japan) and smallest (Australia, Egypt, and Malaysia) generators of hazardous waste. 

By contrast, the management of such waste does seem to be related to income levels,

as high-income countries tend to manage a larger share of their hazardous waste

streams than developing countries. One notable exception to this trend is Malaysia,

which reportedly treats 90 to 95 percent of its hazardous waste. Most of the sample

economies employ advanced hazardous waste treatment and disposal methods. 

Specially engineered landfilling, incineration, and chemical treatment are the most

common treatment methods used in high-income countries, and are employed to

some extent by middle-income countries as well. It is reported that some of the
8-8

Table 8-2Characteristics of selected hazardous waste marketsCountry

Waste generation and

share managed

Principal treatment

methods

Extent of private

participation

Market

competitiveness

Australia 275,000 metric tons in 2000,

virtually all of which wasmanaged.

Specially engineeredlandfilling, chemicaltreatment, andrecycling.

Private sector dominates. Competitive and

moderatelyconsolidated market,top 4 firms account for57 percent of revenues(includes solid andhazardous segments).

Canada 6 million metric tons in 2000,

virtually all of which wasmanaged.

Landfilling is believed topredominate. Half of hazardouswaste imported in 2001was recycled, 21percent landfilled, 15percent incinerated,and 13 percentphysically or chemically treated.

Private sector dominates. Competitive market,

consolidation is likely toincrease due toovercapacity indisposal technologies.

Chile Estimated 600 million metric

tons per year, little of which isbelieved to be managed.

Landfilling, incineration,and open dumping.

Private sector dominates. Evolving market, with

two companiescurrently dominatingthe Santiago market. 

China 10 million metric tons per year,

most of which is reportedlymanaged.

Incineration, chemicalneutralization,solidification, andlandfilling.

Public sector dominatesbut the government isencouraging privatesector initiatives.

Evolving market, notconsolidated.

Czech Republic 1.3 million metric tons in 2002,

57 percent of which wasmanaged.

Recycling (27 percent), physical chemicaltreatment (14 percent),and landfilling (10percent).

Private sector dominates. Evolving, competitive

market.
8-9

Table 8-2–continuedCharacteristics of selected hazardous waste marketsCountry

Waste generation and

share managed

Principal treatment

methods

Extent of private

participation

Market

competitiveness

Egypt Estimated 100,000-300,000

metric tons per year, little ofwhich is believed to bemanaged.

Open dumping andburning.

Public sector dominates,but government isplanning to transferoperations to the privatesector.

Market is in earlystages of development. 

European Union Estimated 4.7 million metric

tons per year in WesternEurope during 1997-2001,most of which was believed tobe managed.

Landfilling, recycling,and incineration.

Private sector dominates. Mature, consolidated

market, thoughopportunities exist inaccession country andniche markets (e.g.,medical wastetreatment).

Japan Estimated 220 million metric

tons in 2000, most of whichwas managed.

Incineration, chemicaltreatment, andlandfilling of treatedwaste.

Private sector dominates. Mature market, highly

competitive.

Malaysia 363,000 metric tons in 2002,

90-95 percent of which wasreportedly managed.

Incineration, chemicaltreatment, and storage.

Private sector dominates. A single company has

exclusive rights to allincineration andchemical treatmentthough 2013.

Mexico Estimated 6 to 11 million

metric tons per year, 25percent of which is believed tobe managed.

Incineration (waste-toenergy) predominates;sterilization for medicalwaste.

Mexican-owned privatefirms are believed todominate.

Evolving, fragmentedmarket consisting ofapproximately 873firms.

South Africa No data available. Open dumping and

landfilling.

Private sector dominates. Although market is in

early stages ofdevelopment, a fewprivate companies areoperating.
Table 8-2–continued

Characteristics of selected hazardous waste marketsCountry

Waste generation and

share managed

Principal treatment

methods

Extent of private

participation

Market

competitiveness

8-10

United States 36 million metric tons

generated by large-quantitygenerators in 1999, which,according to industry sources,account for approximately 60percent of hazardous wastegeneration; 100 percent ofwhich was managed.

Land disposal, mainlydeep-well orunderground injection(69 percent), thermaltreatment (11 percent),and recovery (8percent).

Private sector dominates. Mature market with

approximately 1,200firms operating. CleanHarbors holds thelargest share of thehazardous wastemarket (12 percent),while Stericycle holdsthe largest share (25percent) of the medicalwaste market.

Source: Compiled by the U.S. International Trade Commission from various primary and secondary sources. For more specific informati

country-specific tables presented in chapters 3-7.
8-11

developing economies also engage in open dumping and uncontrolled landfilling and

burning of hazardous waste. However, as is the case with solid waste, many of those

countries also take measures to recover potentially useful materials from the waste

stream prior to disposal. The hazardous waste management industry is dominated by

the private sector in almost all of the sample countries, regardless of income level. In

most cases, state and local governments require industry to bear the burden of

treating its hazardous waste. 

The stringency of hazardous waste regulations and the ability of governments to

monitor and enforce those laws differ widely among the sample economies. 

Hazardous waste regulation and enforcement is typically more stringent in highincome economies than that in developing economies. A comparison of per capita

income levels and industry perceptions regarding the stringency of national toxic

waste regulations reinforces the positive relationship between the stringency of

regulations and per capita income (figure 8-2): toxic waste regulations are generally

considered to be more stringent in high-income countries and less stringent in

countries with lower per capita income levels. In developing countries such as

China, Mexico, Chile, and South Africa, toxic waste disposal regulations may exist

but are perceived as weak, and therefore noncompliance and illegal disposal may be

more common than in high-income countries. Alternately, in some instances,

developing countries may be able to enforce the laws but lack adequate treatment

capacity, thus requiring companies to store hazardous waste until treatment options

become available. 

Trade and Investment

The extent of cross-border trade and investment in solid and hazardous waste

management services differs dramatically among the countries examined in this study

(table 8-3). Such activity is most common among high-income countries where

stringent regulation and consistent enforcement create steady demand for waste

management services and encourage the development of waste management capacity. 

In the European Union, Japan, and the United States, markets for waste management

services are mature and highly competitive. Thus, many firms in these economies

seek new market opportunities abroad. Although trade accounts for a substantial

portion of Canadian waste management activities, there are also substantial

opportunities within that country’s domestic market as the industry is only

moderately concentrated and new regulations have recently emerged. Australia is

currently believed to be a net exporter of waste management services, though import

levels may rise as the country attempts to lessen its reliance on landfilling. Among

the selected middle-income countries, trade can be sporadic reflecting immediate,

short-term needs rather than long-term service solutions. In Chile, China, and

Malaysia, imports of equipment and technology are more common than services, as

those countries work toward establishing waste management infrastructure. As the

regulatory environment and the technology in those countries continue to evolve,

opportunities for trade will likely increase. 

Few of the countries selected for discussion in this report have explicit restrictions on

trade in solid and hazardous waste management services. However, regulations

8-13

Table 8-3Extent of solid and hazardous waste services trade by certain countries, and measures affecting such trade

Country Cross-border trade Foreign operations

Type of measure affecting

trade/affiliate transactions 

Australia Net exporter. Foreign firms control 25 percent of

the solid and hazardous wastemanagement market. Australian exporters of solid andhazardous waste management services focus largely on the AsiaPacific and European markets.

Investment contingencies. Pr

mapInwinna

Canada Net importer of solid waste services,

as 1 million tons of Canadian wasteproducts were transferred to foreignmarkets, virtually all to the UnitedStates, while 97,000 tons of foreigngenerated waste entered Canada,again virtually all from the UnitedStates.Net exporter of hazardous wasteservices, as 560,000 tons of foreignwaste, principally from the UnitedStates, entered Canada fortreatment and disposal, while324,000 tons were transferredabroad, virtually all to the UnitedStates.

Canada's largest solid wastemanagement firm is a subsidiary ofa U.S. firm, and additional U.S.firms compete there. Moremunicipalities are divesting wastemanagement operations andissuing contracts to private firms,attracting domestic and foreignparticipants. Canadian firms arebeginning to establish operations inthe U.S. market throughacquisitions.Major U.S. hazardous wastemanagement firms compete in themarket, although leading Europeanfirms are believed to have reducedtheir operations in Canada. Canadian waste management firms'operations in the U.S. market arethought to be limited totransportation of waste across theU.S.-Canadian border.

Land purchase.Accreditation of engineers: • Market access.• National treatment.Accreditation of consultingengineers:• Market access.

Its thnathreIn coprrecitSareseboof Mprthan

Chile Imports in 2000 totaled $1.4 billion

for solid and hazardous wasteservices and equipment.

Three foreign-based companiesdominate the solid waste disposalservice in the Santiago MetropolitanRegion. No foreign-basedcompanies are known to operateoutside of Santiago.

Investment contingencies. Co

of prm
8-14

Table 8-3–continuedExtent of solid and hazardous waste services trade by certain countries, and measures affecting such trade

Country Cross-border trade Foreign operations

Type of measure affecting

trade/affiliate transactions 

China Minimal, though believed to be a net

importer.

Few foreign companies operate inChina’s solid and hazardous wastemanagement market. 

Equity limitations.Licensing requirements.Land ownership.

FopeAmm

enneprAlgobapeeaasbust

Czech Republic Net importer. Czech firms primarily operate

domestically, where they competewith EU firms.

Full market access. No 

Egypt Net importer. Several foreign-based companies

have provided various solid wastemanagement services, includingcollection and disposal of solidwaste, and consulting services fordeveloping a hazardous wastemanagement program and forprivatizing the solid wastemanagement system. No singlecompany is known to dominateEgypt’s emerging solid andhazardous waste market. 

Equity limitations.Land purchase.

LicoLiof pu
Table 8-3–continued

Extent of solid and hazardous waste services trade by certain countries, and measures affecting such trade

Country Cross-border trade Foreign operations

Type of measure affecting

trade/affiliate transactions 

8-15

European Union Net exporter.

Indicators are that exports todestinations outside the EUgenerate less than 5 percent of theEU environmental servicesindustry’s revenue, while less than10 percent of the sector’s revenue is

intra-EU trade.

EU firms operate throughout the EUand face virtually no outsidecompetition within the market.

Classification requirements.No commitments scheduled forrefuse disposal services viamode 1, due to technicalinfeasibility.

Thclsese“pclenwawa

Japan Net exporter. Few, if any, foreign companies

operate in Japan’s solid andhazardous waste managementmarket.

Licensing requirements.Market access.

ColicmarFoto wJa

Malaysia Minimal, though believed to be a net

importer.

Few foreign companies operate inMalaysia’s solid and hazardouswaste management market. 

Equity limitations.Market access.

FopePrhaseloM
Table 8-3–continued

Extent of solid and hazardous waste services trade by certain countries, and measures affecting such trade

Country Cross-border trade Foreign operations

Type of measure affecting

trade/affiliate transactions 

8-16

Mexico Although data on Mexico’s solid

waste services trade are notavailable, Mexico is likely a netimporter of solid waste services, inpart because Mexican landfillcapacity is insufficient to meetdomestic demand in border areas.Net exporter of hazardous wasteservices, as available data indicatethat the volume of Mexican wastetransported to foreign markets fortreatment and disposal (84,000 tons)

is less than the volume of foreignwaste transported to Mexico fortreatment and disposal (255,000tons).

The extent of participation by nonMexican-owned solid waste firms inthe market is believed to be smalland largely by U.S. firms. Mexicanfirms are believed to operate solelyin Mexico.Major U.S. hazardous waste firmsoperate selectively in the market,which is substantiallyunderdeveloped. The extent ofMexican firms' participation inforeign markets is unknown andbelieved to be negligible.

Equity limitations. M

limarcoHcole

South Africa May be a net importer. At least one foreign-based company

provides waste managementservices in South Africa. No singlecompany is known to dominateSouth Africa’s emerging solid andhazardous waste market.

Full market access. No 
Table 8-3–continued

Extent of solid and hazardous waste services trade by certain countries, and measures affecting such trade

Country Cross-border trade Foreign operations

Type of measure affecting

trade/affiliate transactions 

8-17

United States Net importer of solid waste services

($503 million, exports; $1.3 billion,imports).Net importer of hazardous wasteservices ($95 million, exports; $220million, imports).

U.S. solid waste management firmsserve prominently in the Canadianmarket; elsewhere abroad, U.S.firms have sold their Europeanoperations in order to focusresources primarily on the U.S.market. European firms, facingscant competition from externalcompetitors in their home market,have acquired U.S. wastemanagement firms and thus arecompetitive in the U.S. market.U.S. hazardous wastemanagement firms are competitivein all North American markets,owning and operating facilities inCanada and Mexico, andparticipating elsewhere abroadthrough joint ventures and licensingagreements. European firmscompete in the U.S. marketsignificantly, relatively more than insolid waste, while facing virtually nocompetition from non-Europeanfirms in their home market.

Modes of supply 1,2,3:• Market access/national

treatment.

Land use.Licensing of natural persons:• Market access.• National treatment.Presence of natural persons:• Market access.

UreapcoWrigcitwseUlicenenD12 reprinseMprreMth

Source: Compiled by the U.S. International Trade Commission from various primary and secondary sources. For more specific information and 

specific tables presented in chapters 3-7.
8-18

and practices that pertain to all sectors, or to related sectors such as architecture and

engineering, can potentially limit trade in the waste management industry. The most common

trade barriers maintained by developing economies are equity limitations. Specifically, China,

Egypt, Malaysia, and Mexico limit the share of equity that foreign investors can hold in any

given enterprise. Additionally, complex licensing requirements and limitations on land

ownership are prevalent among both developing and high-income countries.
APPENDIX A

REQUEST LETTER



APPENDIX B

FEDERAL REGISTER NOTICE



APPENDIX C

CHOICE OF DISPOSAL METHOD: A

COMPARISON OF COUNTRY- AND

U.S. STATE-SPECIFIC DATA

 1

 Austria, Belgium, Denmark, France, Germany, Hungary, Japan, Korea, Luxembourg,

Mexico, the Netherlands, Poland, Slovakia, Spain, Sweden, the United States, and the United

Kingdom.

 2

 In making these comparisons it should be borne in mind that national definitions differ.

OECD Environmental Data Compendium 2002: Waste (Paris: OECD), p. 11; and USITC

calculations.

 3 OECD Environmental Data Compendium 2002, p. 9.

 4

 Ibid., p. 13.

C-3

Origin of Disposed Materials 

As mentioned above, a large share of industrial hazardous waste is generated by the

chemical and petrochemical industries. MSW comes from a broader variety of

sources. In most countries, a majority of MSW is produced by households. OECD

data for the most recent year available (generally 2000) enables a comparison of

household MSW as a share of total MSW for 21 countries. For 17 of these

countries1

 household MSW accounts for between 60 and 90 percent of total MSW,

and for the other four (Finland, Iceland, Ireland, and Norway) household MSW

accounts for between 30 and 60 percent of total MSW.2

 In most countries, the largest

individual waste stream is construction and demolition wastes, with packaging

materials ranking second. Not all of these wastes are classified as MSW though they

may sometimes be managed in similar ways.3

 Across OECD countries, organic

material accounts for between 20 and 52 percent of MSW; paper and paperboard

account for between 14 and 38 percent; plastics account for between 0.5 and 13

percent; glass accounts for between 3 and 13 percent; metals account for between 2

and 8 percent; and textiles and other materials account for between 7 and 51

percent.4

Choice of Disposal Method

Geographic Comparisons 

International comparisons 

Even at the high levels of income characteristic of most OECD members, the entire

population may not be served by municipal waste services, indicating market

opportunities for the extension of basic household and commercial service. Among

middle-income OECD members, the share of the population not yet served by MSW

services was 14.9 percent in Hungary (2000), 15.0 percent in Greece (1997), 16.5

percent in Mexico (2000), 27.0 percent in the Russian Federation (1992), and 28.1

percent in Turkey (1998). 

Table C-1 provides information on the share of MSW destined for different disposal

methods across OECD member countries. The share of MSW destined for landfills

ranged from 17 percent (Denmark) to a high of 100 percent (New Zealand). 

Countries with high landfill use (between 90-100 percent of MSW) include Hungary,

Iceland, Ireland, Mexico, New Zealand, Poland, and Turkey. Countries with low
C-4

Table C-1

Disposal of municipal waste, selected countries, year of most recent data

Country

Year of most

recent data Total Recycling Composting Incineration Landfill

1000

Metric

tons

———————————Percent—————————

Austria . . . . . . . . . 1999 3,096 34 15 15 29

Belgium . . . . . . . . . 1999 5,473 40 16 27 32

Canada ......... 1998 9,926 30 11 (1

) (1)

Czech Republic . . . 2000 3,434 (1

) (1) (1) (1)

Denmark . . . . . . . . 2000 3,546 22 16 52 10

Finland . . . . . . . . . 1999 2,400 (1

) (1) 8 60

France . . . . . . . . . 1999 30,744 10 8 33 48

Germany . . . . . . . . 1998 44,094 34 7 21 37

Greece . . . . . . . . . 1997 3,900 8 (1

) (1) 91

Hungary ........ 2000 4,084 (1

) (1) 9 91

Iceland . . . . . . . . . 2000 192 9 2 9 81

Ireland . . . . . . . . . . 2000 2,302 8 1 0 91

Italy . . . . . . . . . . . . 1997 27,425 7 9 6 78

Korea . . . . . . . . . . 2000 16,950 4 (1

) 12 47

Japan .......... 1999 51,446 9 (1

) 78 21

Luxembourg ..... 1999 227 (1

) 15 59 26

Mexico . . . . . . . . . 2000 30,733 2 (1

) (1) 98

Netherlands ..... 2000 9,691 23 24 41 13

New Zealand . . . . . 1999 1,450 (1

) (1) (1) 100

Norway . . . . . . . . . 2000 2,755 22 9 15 55

Poland . . . . . . . . . 2000 12,226 (1

) 2 3 98

Portugal ........ 2000 4,531 6 6 21 67

Russian Federation 1992 26,000 (1

) 1 4 95

Slovak Republic . . 2000 1,706 2 5 12 62

Spain . . . . . . . . . . 1999 18,377 5 18 6 72

Sweden ......... 1998 4,000 25 8 35 32

Switzerland . . . . . . 2000 4,681 32 14 48 6

Turkey . . . . . . . . . . 1999 24,945 (1

) 1(1) 96

United Kingdom . . 1999 33,200 9 2 8 81

United States . . . . 1999 208,520 22 6 15 57

 1

 Not available.

Source: OECD Environmental Data Compendium 2002: Waste, and USITC calculations. Percentages may

not add to 100 due to inconsistencies in underlying data and a small category of "other" disposal in some

countries. Some values reported as not available may represent zero values.
 5

 Ibid., p. 14; and USITC calculations.

 6

 This compares to Biocycle’s estimate for the United States of 61 percent landfilled, 31

percent recycled or composted, and 7 percent incinerated in 2001. “The State of Garbage in

America,” Biocycle, vol. 42, No. 12, Dec. 2001, p. 43.

 7 OECD Environmental Data 2002: Waste, p. 14; and USITC calculations.

 8

 “The State of Garbage in America,” p. 45.

C-5

landfill use (between 17-39 percent of MSW) include Denmark, Japan, Luxembourg,

the Netherlands, and Sweden. Incineration is particularly prevalent where land is

scarce, with the share of total MSW incinerated reaching 78 percent in Japan, 59

percent in Luxembourg, 52 percent in Denmark, and 48 percent in Switzerland. The

reported recycling rate is over one-third of total MSW in Austria, Belgium, and

Germany, and less than 10 percent in Iceland, Ireland, Korea, Mexico, Portugal, and

the United Kingdom.5 The United States ranks near the middle in terms of the share

of its MSW that is landfilled (57 percent), recycled (22 percent), composted (6

percent), and incinerated (15 percent).6 However, the total quantity of MSW

landfilled in the United States, as measured in metric tons, is four times larger than in

Japan, the OECD runner-up in this category.7

Figures C-1 through C-3 show the relationship among the shares of MSW disposed

of by landfilling, incineration, and recycling for OECD countries, using data for 2000

or the most recent year available. Figure C-1 shows that less densely populated

countries are more likely to rely on landfilling, while Figure C-2 shows that more

densely populated countries are more likely to rely on incineration.

Figure C-3 shows that there is no apparent relationship between population density

and the recycling rate, which may in part be due to the definition of recycling being

less standardized between countries than for the other methods of disposal.

In the United States 

State-level U.S. data for 2001 confirm the general pattern that incineration tends to be

used in land-scarce jurisdictions, while landfills dominate in land-rich jurisdictions. 

Landfills account for over 85 percent of MSW disposal in Colorado, Kansas, Nevada,

New Mexico, North Dakota, Oklahoma, Utah, and Wyoming. Incineration rates

reach a maximum of 79 percent in the District of Colombia and 65 percent in

Connecticut, while Hawaii, Maine, Maryland, Massachusetts, and Minnesota each

incinerate between 20 and 50 percent of MSW. Bearing in mind definitional

differences, reported recycling rates reach a level of 59 percent in Delaware and

between 40 and 50 percent in Arkansas, California, Maine, Minnesota, and New

York. 8

 

A comparison of U.S. data on tipping fees, which provide a direct measure of landfill

demand relative to supply, reinforces the positive relationship between landfill





APPENDIX D

SOLID AND HAZARDOUS WASTE

SERVICES IN THE GENERAL

AGREEMENT ON TRADE IN

SERVICES (GATS)

 1

 Under a “positive-list” agreement, members are only bound by those commitments that

they specifically list within their schedules which comprise part of the agreement. By

contrast, a “negative-list” agreement binds member countries to all provisions covered by the

agreement unless otherwise specified.

 2

 World Trade Organization (WTO), “Services Sectoral Classification List,”

MTN.GNS/W/120, July 10, 1991.

 3

 WTO, “Background Note by the Secretariat,” S/C/W/46, July 6, 1998, footnote 6, page 2.

 4

 One of four possible modes of delivering services to foreign consumers, whereby the

consumer, or the consumer’s property, receives a service outside the territory of the home

country, either by moving or being situated abroad.

 5

 One of the four possible modes of delivering services to foreign consumers, whereby a

service supplier establishes any type of business or professional establishment in the foreign

market. Commercial presence comprises entities such as corporations, trusts, joint ventures,

partnerships, sole proprietorships, associations, representative offices, and branches.

D-3

The General Agreement on Trade in Services (GATS) was signed in April of 1994 and

entered into force in January of 1995. The GATS is the first multilateral, legally

enforceable agreement covering trade and investment in the service sector. Modeled

after the agreement on goods, the GATS is a “positive-list” agreement1

 which binds

signatories to provide foreign firms with market access and nondiscriminatory

treatment, subject to defined exemptions. The primary purpose of the agreement is to

reduce or eliminate measures that prevent services from being provided across borders

or that discriminate against locally established service providers with foreign

ownership. The agreement is organized in four parts: the main text containing general

principles and obligations; annexes dealing with rules for specific sectors; individual

countries’ specific commitments; and lists indicating temporary exemptions from the

most-favored-nation principle of nondiscrimination. 

Country-Specific Commitments

Country-specific commitments typically are organized based on the Services Sectoral

Classification List,2

 which organizes services industries into 12 broad sectoral

categories and provides corresponding numbers from the United Nations Provisional

Central Product Classification (CPC). Under this classification scheme, the

environmental services sector includes four subsectors: sewage services (CPC 9401);

refuse disposal services (CPC 9402); sanitation and similar services (CPC 9403); and

other environmental services, which are generally presumed to include cleaning of

exhaust gasses (CPC 9404), noise abatement (CPC 9405), nature and landscaping

protection services (CPC 9406), and other environmental services (CPC 9409). Waste

management services, excluding the sale of wastes, are captured in the “Refuse

Disposal Services” subcategory, which the World Trade Organization (WTO) defines

as “...services to collect, transport, treat and dispose of waste from homes,

municipalities, commercial establishments and manufacturing plants.”3

Fifty-one countries have scheduled specific commitments in the environmental

services sector, and 43 countries have scheduled commitments on refuse disposal

services. Of these, 29 countries have scheduled commitments granting full market

access and national treatment to foreign service suppliers that provide refuse disposal

services through consumption abroad (mode 2)4

 or a commercial presence (mode 3)5

(table D-1). Limitations listed by the remaining 14 countries include, inter alia,
 6

 One of four possible modes of delivering services to foreign consumers, whereby the

service is transported beyond the home country of the services supplier to the foreign

consumer. Cross-border supply may entail transportation by mail, telecommunications, or the

physical movement of merchandise embodying service (e.g., a diskette storing information)

from one country to another. The mode is “cross-border” when the service supplier is not

present within the territory where the service is delivered. 

 7

 One of four possible modes of delivering services to foreign consumers, whereby one

individual, acting alone or as an employee of a service supplier, provides a service while

present in a foreign market.

 8

 Article XIX of the GATS requires WTO member economies to initiate a new round of

services negotiations no later than five years after the entry into force of the WTO agreement.

 9

 WTO, “List of 2000 Service Proposals,” found at Internet address

http://www.wto.org/english/tratop_e/serv_e/s_propnewnegs_e.htm/, retrieved July 14, 2003.

D-4

licensing restrictions, provisions requiring approval for the establishment of a

commercial presence, a provision requiring foreign firms to form a joint venture

(listed in China’s schedule), and a measure limiting foreign equity participation in the

refuse disposal sector to 49 percent (listed in Thailand’s schedule). Several member

countries have not scheduled bindings on refuse disposal services provided through

cross-border supply (mode 1)6

 as they consider such transactions technically

infeasible, and most measures regarding the supply of services through the presence of

natural persons (mode 4)7

 are addressed in a member country’s horizontal

commitments.

With regard to scope, 29 countries have scheduled commitments that cover the full

range of services in the refuse disposal sector. Among the countries that committed to

partial coverage of the sector, eight countries include an overall exemption limiting

their refuse disposal commitments to services supplied and/or purchased by private

entities. Provisions that limit the range of activities covered under refuse disposal

commitments also appear in eight schedules of commitments. For example, both

Lesotho and South Africa indicate that their refuse disposal commitments apply only

to consultancy services.

Current GATS Negotiations

In keeping with Article XIX of the GATS,8 a new round of services negotiations

began in January 2000. WTO Member economies submitted over 100 negotiating

proposals to the GATS Council for Trade in Services,9

 in preparation for the

negotiations. In these proposals, member economies outlined their positions regarding

specific service sectors and various issues that affect multiple service sectors, such as

transparency and autonomous liberalization. The negotiations themselves, which are

currently underway, are being conducted through a request-offer approach. Under this

approach, WTO Member economies have submitted initial requests, formally asking

other WTO Members to make specific changes to their schedules of commitments. 

Following the receipt of these requests, WTO Members submitted initial offers. These

nonbinding offers are presented in redline-strikeout format, illustrating the changes

that member economies may be willing to make in their schedules of commitments in

response to other members’ requests.
D-5

Table D-1Nature of GATS commitments on refuse disposal servicesMember country

Do commitmentsapply to all or partof the sector?

Did the membercountry schedulefull or partialcommitments?1 Nature of limitations listed in GATS schedule

Albania All Full No restriction or limitations exist.Armenia All Full No restriction or limitations exist.Australia All Full No restriction or limitations exist.Austria All Full No restriction or limitations exist.Bulgaria Part Full Commitments do not include environmental services s

governmental authority, which includes regulatory, adm

services by government and municipal bodies related Additionally, the commitments do not apply to services transportation, storage, secondary use, recycling, restproduction of energy and materials, and disposal of daand substances.

Canada All Full No restriction or limitations exist.China Part Partial Commitments exclude quality monitoring and pollution 

Additionally, foreign firms are permitted market access presence only in the form of joint ventures, with foreign permitted. Environmental consultation is the only cros

Croatia All Partial Refuse disposal services are legally considered as mu

primarily by entities owned by local authorities. Private provide these services on the basis of a concession gr

Czech Republic All Full No restriction or limitations exist.Ecuador All Full No restriction or limitations exist.Estonia Part Full Commitments apply only to refuse disposal services c

industry.

See footnote at end of table.
D-6

Table D-1–continuedNature of GATS commitments on refuse disposal servicesMember country

Do commitmentsapply to all or partof the sector?

Did the membercountry schedulefull or partialcommitments?1 Nature of limitations listed in GATS schedule

EU All Full No restriction or limitations exist.Finland All Full No restriction or limitations exist.France in respect of NewCaledonia

Part Partial Commitments apply to treatment of industrial and/or h

collection. Commercial presence in the Loyalty Islandauthorization by the competent authorities. Additionallimit the provision of refuse disposal services through tpersons.

FYR Macedonia All Full No restriction or limitations exist.Georgia All Full Consulting and advisory services are the only refuse d

through cross-border supply.

Hungary All Full No restriction or limitations exist.Iceland All Partial Environmental operating license required for market a

presence and presence of natural persons.

Israel Part Full Commitments do not include industrial activities. Also 

practice in this sector to require a local representative.

Japan All Partial The number of licenses conferred to service suppliers 

sea from vessels may be limited.

Korea Part Partial Commitments include only collection, transport, and di

industrial refuse. Additionally, establishment of a comsubject to the economic needs test. Refuse collection suppliers may conduct business only within jurisdiction Regional Environment Office which has granted them 

Kuwait All Partial Undertakes no commitments on the provision of refuse 

through consumption abroad.

Kyrgyz Republic All Full No restriction or limitations exist.See footnote at end of table.
Table D-1–continued

Nature of GATS commitments on refuse disposal servicesMember country

Do commitmentsapply to all or partof the sector?

Did the membercountry schedulefull or partialcommitments?1 Nature of limitations listed in GATS schedule

D-7

Latvia All Full No restriction or limitations exist.Lesotho Part Full Commitments restricted to consultancy services only.Liechtenstein Part Partial Commitments do not apply to public work functions wh

operated by municipalities or Liechtenstein Governme

them. Additionally, market access through commerciagarbage dumps. Commercial presence in Liechtensteof services through presence of natural persons.

Lithuania All Full No restriction or limitations exist.Moldova All Full No restriction or limitations exist.Morocco All Partial Undertakes no bindings on market access through conNorway Part Partial Commitments do not include public service functions w

operated or contracted out by local, regional, or centracategories of waste there exists a monopoly.

Oman All Full No restriction or limitations exist.Qatar All Partial Undertakes no bindings on the provision of refuse disp

consumption abroad.

Sierra Leone All Partial Undertakes no bindings on the provision of refuse disp

consumption abroad.

Slovak Republic All Full No restriction or limitations exist.Slovenia Part Full Public utilities exist for refuse disposal services, but co

granted to the private operators established in the Rep

South Africa Part Full Commitments restricted to consultancy services only.See footnote at end of table.
Table D-1–continued

Nature of GATS commitments on refuse disposal servicesMember country

Do commitmentsapply to all or partof the sector?

Did the membercountry schedulefull or partialcommitments?1 Nature of limitations listed in GATS schedule

D-8

Sweden Part Full Commitments do not include public works functions wh

operated by municipalities, state, or federal governme

these governments.

Switzerland Part Partial Commitment does not include public work function wh

by municipalities, cantons, or federal government, or cAdditionally, presence of natural persons requires comSwitzerland.

Taiwan All Full No restriction or limitations exist.Thailand All Partial No limitations on national treatment as long as foreign 

not exceed 49 percent.

Turkey All Full No restriction or limitations exist.United Arab Emirates All Full No restriction or limitations exist.United States Part Full Commitments apply only to services contracted by priv

limited to the following activities: implementation and inexisting systems for environmental cleanup, remediatio

monitoring; implementation of environmental quality coreduction services; maintenance and repair of environfacilities not already covered by the US commitments orepair of equipment; on-site environmental investigatiomonitoring; sample collection services; training on-site consulting related to these areas.

1 The cross-border supply of refuse disposal is often considered unfeasible, and most measures regarding the supply of services thro

natural persons are addressed in a member country’s horizontal commitments. Thus, for the purposes of this table, a full commitment is 

grants full market access or national treatment to foreign individuals or firms that provided refuse disposal services through consumption presence. A partial commitment is any commitment that limits market access and/or national treatment through consumption abroad or c

Source: Compiled by the U.S. International Trade Commission.
 10 WTO, “Communication from Australia, Negotiating Proposal for Environmental

Services,” S/CSS/W/112, Oct. 1, 2001; “Communication from Canada, Initial Negotiating

Proposal on Environmental Services,” S/CSS/W/51, Mar. 14, 2001; “Communication from

Colombia: Environmental Services,” S/CSS/W/12, Nov. 27, 2001; “Communication from

Cuba, Negotiating Proposal on Environmental Services,” S/CSS/W/142, Mar. 22, 2002;

“Communication from the European Communities and their Member States, GATS 2000:

Environmental Services,” S/CSS/W/38, Dec. 22, 2000; “Communication from Switzerland,

GATS 2000: Environmental Services,” S/CSS/W/76, May 4, 2001; and “Communication from

the United States, Environmental Services,” S/CSS/W/25, Dec. 18, 2000, all found at Internet

address http://www.wto.org/, retrieved June 20, 2003.

 11 The proposal submitted by Cuba does not address classification issues.

D-9

The environmental services sector, including the solid and hazardous waste services

segment, is one of many industries under discussion in the ongoing WTO services

negotiations. This section discusses environmental services proposals submitted to the

WTO, provides an overview of initial requests and offers that specifically address the

refuse disposal segment, and presents a general overview of the current status of WTO

services negotiations.

Environmental Services Submissions

Australia, Canada, Colombia, Cuba, the European Union (EU), Switzerland, and the

United States have submitted negotiating proposals on environmental services.10

These proposals focus primarily on the environmental services sector as a whole,

though refuse disposal services are specifically mentioned in certain proposals with

respect to classification issues. Only Australia’s proposal includes a specific reference

to refuse disposal services (landfills) when listing barriers to trade. Six proposals11

suggest that the current WTO classification of the environmental services sector does

not adequately cover all activities of the industry. Nearly identical proposals from the

EU and Switzerland include modifications to the current environmental services

classifications, as well as the addition of a specific list of related services - such as

construction, engineering, and research and development. Among other changes, the

proposals suggest combining refuse disposal services (CPC 9402, currently

categorized as 6B) with sanitation and similar services (CPC 9403, currently

categorized as 6C) to create a broader category 6B entitled solid/hazardous waste

management. Australia endorses the EU/Switzerland approach, but does not

specifically list services that should be addressed within these negotiations. Colombia

also favors the EU classification and proposes that environmental impact assessment,

monitoring, and auditing, as well as the design of environmental technologies, be

included. The United States and Canada propose the consideration of both core

environmental services, consisting primarily of the currently classified environmental

services sectors, and an expansion to include environmentally related services,

although neither proposes a specific list of such related services. 

The principal objective of the proposals submitted by Australia, Canada, the EU,

Switzerland, and the United States is the reduction and removal of barriers to trade in

environmental services. Each paper supports the liberalization of a similar list of trade

impediments, including restrictions on the provision of services through a foreigninvested commercial presence (mentioned in all five papers), limitations on the

temporary entry and stay of foreign personnel (included in papers submitted by

Canada, the EU, Switzerland, and the United States), and a lack of regulatory
 12 United States Trade Representative (USTR), “U.S. Proposals for Liberalizing Trade in

Services: Executive Summary,” press release, July 1, 2002, found at Internet address

http://www.ustr.gov/, retrieved Oct. 23, 2003.

 13 European Commission (EC), “Summary of the EC’s Initial Requests to Third Countries

in the GATS Negotiations,” July 1, 2002, found at Internet address http://europa.eu.int/,

retrieved Oct. 27, 2003.

D-10

transparency (included in papers submitted by Australia, Canada, the EU, and the

United States). The EU and Switzerland also propose the liberalization of barriers

relating to the provision of environmental services through cross-border supply or

consumption abroad. Each of these papers recognizes that some of these objectives,

such as increased transparency and reduction of certain restrictions on commercial

presence, will require liberalization of those trade measures that apply to service

providers in all industry sectors. 

The proposal from Colombia indicates that the commercial presence of foreign

enterprises in the provision of environmental services may be beneficial for

developing countries, and commitments should be evaluated based on the member

country’s level of economic development. In addition, the paper proposes that

member countries evaluate the professional qualification of foreign service providers

using the same criteria applied to domestic service providers. The proposal submitted

by Cuba also focuses on the interests of developing countries, indicating that such

countries should be able to engage in environmental services trade liberalization on

terms that will enable them to realize the benefits of such liberalization.

Requests for Commitments on Refuse Disposal Services

Paragraph 15 of the Doha Development Agenda established a schedule for the initial

request-offer phase of the services negotiations. According to this schedule, WTO

Member countries were asked to submit their first specific requests of other member

countries by June 30, 2002. These requests are not publically available. However,

summaries issued by several countries indicate that there have been a number of

requests on the environmental services sector as a whole, and on solid and hazardous

waste services specifically. For example, a summary of the U.S. requests indicates

that the United States has asked other WTO member countries to liberalize a number

of environmental services segments, including solid and hazardous waste

management.12 The EU states that it has requested the elimination of restrictive and

discriminatory measures facing EU providers of environmental services. The EU

summary also indicates that EU requests are modeled after the environmental services

classification included in its proposal (see above), which lists waste management

services among other environmental services activities.13 Canada defines the

environmental services sector to include several activities, such as refuse disposal
 14 “Description of Requests Presented by Canada to its WTO Partners,” Mar. 31, 2003,

found at Internet address http://strategis.ic.gc.ca/, retrieved Oct. 27, 2003.

 15 Ministry of Foreign Affairs (MOFA), “WTO Services Trade Negotiations Submission of

Initial Requests,” June 2002, found at Internet address http://www.mofa.go.jp/, retrieved Oct.

27, 2003.

 16 WTO, “Services: Negotiations, The New Negotiations,” found at Internet address

http://www.wto.org/, retrieved Nov. 17, 2003. 

 17 WTO, “Report of the Meeting Held on 19-22 May 2003,” June 30, 2003, p. 30, and

“Report of the Meeting Held on 4 and 10 July and 3 September 2003,” Sept. 29, 2003, p. 40,

found at Internet address http://www.wto.org/, retrieved Nov. 18, 2003.

D-11

services, and indicates that it has requested the elimination of local partnership and

licensing requirements.14 Further, Japan’s summary states that it has made requests on

all environmental services subsectors.15

Offers Regarding Refuse Disposal Services

Paragraph 15 of the Doha Development Agenda established March 31, 2003 as the

due date for the submission of initial services offers. As of October 30, 2003, 39

economies had submitted offers to the WTO,16 and 12 of these offers had been

derestricted and made available to the public. Among the 12 economies that

submitted derestricted offers, only a small number have proposed substantial changes

to their commitments on refuse disposal services (table D-2), largely due to the fact

that many of these economies had already undertaken substantial bindings on refuse

disposal services during the Uruguay Round. Although six of these economies chose

to recast their Uruguay Round commitments using the classification scheme outlined

in the EU proposal, none of the derestricted offers proposed substantive changes to the

scope of refuse disposal commitments scheduled during the Uruguay Round. This is

partially due to the fact that five of these derestricted offers were submitted by

economies that had already made Uruguay Round commitments on the entire refuse

disposal category. 

With regard to the content of the commitments themselves, six of the economies that

submitted publically available offers already maintain full commitments on the

provision of refuse disposal services through modes 2 and 3, and thus, did not propose

significant liberalization in their offers. This includes the European Union, which

made some minor alterations to its mode 4 commitments on refuse disposal services. 

Four of the publically available offers do propose some measure of liberalization in

the refuse disposal segment. New Zealand, which did not schedule any commitments

on refuse disposal services during the Uruguay Round, is proposing to schedule full

commitments on consultancy services related to refuse disposal. Moreover, the offers

submitted by Iceland, Japan, and Norway propose to eliminate certain restrictions

affecting the provision of refuse disposal services through mode 3 or 4. Chile

submitted the only publically available offer that neither contained Uruguay Round

commitments on refuse disposal services nor offered to schedule commitments on this

industry segment during the current negotiating round. 

Minutes from recent meetings of the WTO Council for Trade in Services suggest that

at least two additional countries– Mexico and the Slovak Republic– have submitted

offers on the environmental services sector.17 However, the minutes do not provide
D-12

Table D-2 Publically available offers submitted by WTO members on refuse disposal services WTO Member

Basis of EnvironmentalServices Classification

Changes to Scope of Uruguay RoundCommitments

Changes to content of commitments

Australia EU proposal NoneUruguay Round commitments cover the

entire industry segment.

NoneUruguay Round schedule on this industry segment.

Canada W/120 NoneUruguay Round commitments cover the

entire industry segment.

NoneUruguay Round schedule on this industry segment.

Chile None used NoneThere continue to be no commitments

schedule on this industry segment.

NoneThere would continue to bschedule on this industry s

European Union EU Proposal NoneUruguay Round commitments for most EU

member countries cover the entire industrysegment. Sweden excludes public worksfunctions from its environmental servicescommitments.

The EU is offering to make making its mode 4 commisegment compatible with icommitments on mode 4.

Iceland W/120 NoneUruguay Round commitments cover the

entire industry segment.

Iceland is offering to eliminan environmental operatinrefuse disposal services thwould continue to require provision of services throu

Japan EU proposal NoneUruguay Round commitments cover the

entire industry segment.

Japan is offering to removlimiting the number of liceoil disposal at sea. Japan references to its horizonta3. 

Liechtenstein W/120 NoneCommitments on this industry segment

exclude public works functions.

NoneCommitments would contirestriction on garbage dum
D-13

Table D-2!continued

Publically available offers submitted by WTO members on refuse disposal services WTO Member

Basis of EnvironmentalServices Classification

Changes to Scope of Uruguay RoundCommitments

Changes to content of commitments

New Zealand EU proposal New Zealand previously had no

commitments on refuse disposalservices. New commitments would belimited to consultancy services related tothe provision of refuse disposal.

New Zealand, which precommitments on refuse offering to schedule full consultancy services rerefuse disposal.

Norway EU proposal NoneCommitments on this industry segment

exclude public service functions.

Norway is offering to elimiindicating that monopoly scategories of waste.

Slovenia W/120 NoneSlovenia would continue to limit the scope of

these commitments by indicating thatconcession rights for the operation of publicutilities can be granted to private firmsestablished in Slovenia.

NoneUruguay Round schedule on this industry segment.

Turkey W/120 NoneUruguay Round commitments cover the

entire industry segment.

NoneUruguay Round schedule on this industry segment.

United States EU proposal NoneThe United States would continue to limit its

commitments to certain activities contractedby private industry.

NoneUruguay Round schedule on this industry segment.
 18 Ibid.

 19 WTO, “Services: Negotiations, The New Negotiations,” found at Internet address

http://www.wto.org/, retrieved Nov. 17, 2003. 

D-14

any details regarding the content of these offers and thus, they cannot be compared to

the publically available offers that are discussed above.

Current Status of Services Negotiations 

WTO member economies continue to conduct services negotiations through the

Council for Trade and Services, which met several times during 2003, and through

bilateral consultations.18 To date, the WTO has not established any further interim

deadlines for these negotiations. The current round of services negotiations is

scheduled to conclude by January 1, 2005.19
APPENDIX E

POSITION OF INTERESTED PARTIES

 1

 Scott L. Slesinger, Vice-President for Governmental Affairs, Environmental Technology Council,

Washington, DC, written submission to the Commission, Nov. 6, 2003.

 2

 David Waskow, International Policy Analyst and Trade Policy Coordinator, Friends of the EarthUSA, Washington, DC, written submission to the Commission, Nov. 5, 2003.

E-3

Environmental Technology Council

The Environmental Technology Council (ETC)1 is an association of hazardous and industrial

waste management firms that provide waste treatment, disposal, and recycling services under

U.S. and Canadian regulations. ETC believes that U.S. hazardous waste facilities are highly

advanced, particularly with regard to the management of wastes containing polychlorinated

biphenyls (PCBs). ETC also contends that the United States and Canada generally do not

restrict the transfer of hazardous wastes between their countries. However, ETC indicates

that the United States does not allow the cross-border transfer of PCB-contaminated wastes. 

ETC further notes that despite the U.S. Senate’s likely ratification of the Stockholm Treaty on

Persistent Organic Pollutants, which allows the cross-border transfer of PCBs and other

pollutants destined for proper disposal, ETC does not expect the United States to approve or

implement those portions of the treaty that allow such transfers. ETC argues that the inability

to import such waste for treatment may not be consistent with the United States’ international

obligations. ETC also argues that this prohibition has an economically deleterious effect on

the U.S. hazardous waste industry and increases the probability that such waste will be

improperly disposed. ETC contends that if the United States does not import PCBcontaminated wastes for disposal, air currents may transfer these pollutants to the United

States, contaminating U.S. land and water. ETC requests the USITC investigate whether

there are inconsistencies between U.S. international obligations and the U.S. ban on PCBcontaminated waste trade.

 

Friends of the Earth - USA

Friends of the Earth - USA2 is the U.S. arm of a global network of environmental groups. The

group was founded in San Francisco in 1969 and has voiced its opinion on many

environment-related issues. Friends of the Earth submitted an article entitled “Environmental

Services Liberalization: A Win-Win or Something Else Entirely?, ” which is to be published

in International Lawyer’s Fall 2003 edition. The article states that environmental services

negotiations, instead of being a win-win solution for trade and the environment, may actually

harm environmental goals. Friends of the Earth claims that the definition of environmental

services used in these negotiations is too broad, including service activities that are actually

harmful to the environment. The submission raises possible conflicts between the

environmental services negotiations, GATS fundamentals such as the nondiscrimination

principle, the Basel Convention on the Control of Transboundary Movements of Hazardous

Wastes and their Disposal, and other government efforts to protect the environment. The

GATS environmental exceptions must also be revised, according to the submission. Although

both the GATT and GATS provide exceptions when “necessary to protect human, animal or

plant life or health,” the GATS exceptions in Article XIV are missing a vital environmental

exception that can be found in GATT Article XX, namely “(g) relating to the conservation of

exhaustible natural resources if such measures are made effective in conjunction with

restrictions on domestic production or consumption.” Friends of the Earth voices two

principal concerns: that a number of nonliving exhaustible natural resources are left
 3

 Michael T. Werner, Esq., Client Service Manager, Weston Solutions, Inc., West Chester, PA,

written submission to the Commission, Oct. 6, 2003.

E-4

unprotected in GATS and that the word “necessary” may make the exception that has been

included in the GATS more susceptible to narrow interpretation. The submission asserts that,

at a minimum, an exception equal to GATT Article XX(g) should be incorporated into the

GATS. Friends of the Earth cautions WTO Member countries to assess the impacts of these

environmental services negotiations before proceeding any further.

Weston Solutions, Inc.

Weston Solutions, Inc.3 is a leading environmental engineering firm with over 1800

employees in more than 60 offices worldwide. The firm actively promotes international trade

in a variety of environmental technologies and services. Weston believes that while

significant opportunities exist worldwide for environmental services firms, the demand for

such services is often limited. For example, Weston has evaluated the hazardous waste

treatment markets in numerous countries and believes that significant volumes of hazardous

wastes are continually being added to substantial stockpiles. Weston believes that this

situation needlessly threatens the local environment, as solutions are available in the

international marketplace. However, constructive solutions often fail to reach fruition due to

factors such as vague project application, approval, and appeal processes, and a lack of

development capital. When interacting with local governments, Weston reportedly has also

encountered difficulties relating to project administration, often resulting from a lack of

technical expertise. Consequently, timely decisions are not made as to the feasibility of

Weston’s proposed technology or any of the alternatives evaluated. Another factor that

frequently limits the international demand for Weston’s services is the less-than-stringent

enforcement of hazardous waste management regulations, which often results from an

inadequate enforcement budget, and standards that are imposed arbitrarily or without

reference to clear standards of conduct. In spite of these hurdles, Weston believes that

substantial markets exist for services and technologies for solid and hazardous waste

treatment.
APPENDIX F

GLOSSARY

F-3

Autoclave: Steam-heated machine used for sterilization.

Characteristic waste: Waste characterized as hazardous by RCRA because it exhibits

ignitability, corrosive activity, reactivity, and/or toxicity.

Collection: Picking up solid waste at its point of generation or storage and putting it in a solid

or hazardous waste vehicle.

Commercial presence (mode 3): A service supplier establishes a type of business or

professional enterprise in a foreign market.

Composting: The biological process involving aerobic decomposition of organic waste under

controlled conditions to treat putrescible waste and/or sewage sludge.

Construction and demolition waste (C&D): Debris from new structures and debris from

renovated or demolished existing structures.

Consumption abroad (mode 2): A consumer, or the consumer’s property, receives a service

outside the territory of the consumer’s country.

Cross-border supply (mode 1): A service is transported beyond the country of the service

supplier to a foreign consumer (the service supplier is not present within the territory of the

consumer).

Deep-well injection (or underground injection): The process of placing raw or treated,

filtered hazardous waste in the pores of permeable subsurface rock by pumping it into deep

wells.

Dioxins: Impurities (i.e., any carcinogenic or teratogenic heterocyclic hydrocarbons) in

petroleum-derived herbicides.

Disposal: The final disposition of solid or hazardous waste.

Energy recovery: Recovery of heat or the creation of steam through the burning of waste. 

Food-to-people program: A program under which food that may otherwise be destined for

disposal is redirected towards consumption. For example, produce stored in warehouses that

can no longer be sold may be destined for such programs.

Gasification: 1) The process of converting a substance to gas through the use of chemicals and

high heat. 2) The production of gaseous fuels by combining carbonaceous materials with air,

steam, or oxygen and subjecting the combination to very high temperatures. The end product is

a mixture of particles, tar compounds, combustible gases, and water vapor. The proportion of

mixture components varies depending on the process, but common to all processes is the need to

purify the resulting gas before commercial use.

Generic waste: General solid and/or hazardous waste that is not the result of a specific product

or process.

Hazardous waste: Any waste material that can cause serious illness, injury, or death, and

environmental damage if improperly managed.

Incineration: A method for the volume reduction and disposal of solid waste and for sewage

sludge through controlled combustion.
F-4

Industrial waste: Waste consisting of a wide variety of nonhazardous materials subject to

Schedule D of the RCRA that result from the production of goods. Most of these wastes are in

the form of waste waters.

Informal recycling sector: Individuals that work independently to collect recyclable materials

from businesses, households, or waste disposal sites. These individuals sell the collected

recyclable materials to intermediaries, or to facilities that reprocess the material for use.

Landfill: Disposal site for refuse that is on or below ground level.

Large quantity generators: Facilities that generate more than 1,000 kg of hazardous waste or

more than 1 kg of acutely hazardous waste per calendar month.

Leachate: Contaminated liquid by-product of solid waste that has percolated through the soil

or some other medium.

Listed waste: Waste that is considered hazardous under RCRA because it meets specific

criteria.

Low-level radioactive waste: Less hazardous wastes than most of those associated with a

nuclear reactor; includes those generated by hospitals, research laboratories, and certain

industries. In the United States, the Department of Energy, Nuclear Regulatory Commission,

and EPA share responsibilities for managing them.

Material recovery facility: Facility at which recyclable products are sorted for sale and reuse

as production inputs.

Medical waste: Waste from healthcare facilities that came into contact or is contaminated with

diseased tissues or infectious microorganisms. May also be referred to as infectious waste,

defined as hazardous waste with disease contaminating characteristics, including animal waste,

human blood and blood products, pathological waste, and discarded sharp objects (e.g., needles,

scalpels, and broken medical instruments). 

Mixed waste: Radioactive waste that is also a hazardous waste. Mixed waste is jointly

regulated by RCRA and Atomic Energy Act.

Municipal solid waste: Nonhazarous waste generated through household and community

activities.

Open dump: A disposal site where waste is simply placed on top of the ground.

Persistent Organic Pollutants: A variety of potential food and water supply contaminants,

including pesticides such as DDT and chlordane, and industrial chemicals such as PCBs and

dioxin.

Plasma technology: 1) A common phrase for a variety of industrial applications using plasma,

an electrically neutral matter also known as the fourth state of matter—solid, liquid, gas, plasma. 

Plasma applications include etching semiconductor chips; depositing silicon to produce solar

cells; depositing silicon dioxide on chemically active surfaces to put them in a passive state or,

in contrast, to activate surfaces; and melting or welding with plasma arcs as well as plasma

chemistry. 2) Plasma technology constitutes minute gas-filled cells that emit light with the

passage of an electric current.
F-5

Polychlorinated biphenyl (PCB): A generic term for a family of man-made chemical

compounds produced by replacing hydrogen atoms on a biphenyl molecule with chlorine atoms

resulting in a clear, pale yellow, viscous fluid. Although no longer produced, characteristics

that made PCBs desirable for industry also made them persistent in the environment, including

chemical stability, ability to withstand high temperatures without degradation, and insolubility

in water. Consequently, they remain in the atmosphere, landfill sites, and waterways. PCBs are

easily consumed by aquatic animals where they enter the food chain. They are fat-soluble and

therefore easy to consume but difficult to excrete. Common industrial uses included electrical

equipment such as transformers and capacitors, heat transfer and hydraulic systems, fluorescent

light ballasts, paints, glues, waxes, carbonless copy paper, newspaper inks, dust-control agents

for dirt roads, solvents for spreading insecticides, and additives in lubricating and cutting oils.

Presence of natural persons (mode 4): One individual, acting alone or as an employee of a

service provider, provides a service while present in a foreign market.

Putrescible: Organic matter liable to decompose or pass into a state of foul decay.

Reclamation: Treating material to recover a usable product, or to regenerate material. For

example, recovery of lead values from spent batteries, regeneration of spent solvents, and

removal of impurities from spent solvents or other hazardous wastes to render them usable as

fuels.

Recovery: Reclaiming materials from the solid waste stream to use for composting and

recycling purposes. This does not include reuse and source reduction activities, such as reusing

yard trimmings for on-site compost, refilling beverage containers, and repairing wood pallets.

Recycling: The recovery, reprocessing, and reuse of certain waste materials.

Remanufacturing: The process of making a finished product from used material.

Reuse: Using certain municipal solid waste products in their original form more than once,

such as refilling glass or plastic bottles, repairing wood pallets, using corrugated or plastic

containers for storage, and returning milk crates.

Sanitary landfill: A facility for solid waste disposal that is designed, constructed, and operated

in such a way as to minimize public nuisances (e.g., windblown litter and unpleasant odors) and

not pose a threat to public health or safety. Three important characteristics distinguish a sanitary

landfill from an open dump: (1) an appropriately selected and prepared (lined with an

impermeable material) landfill site, (2) deposited waste is spread out and compacted, and (3)

each day a soil cover is placed over the waste and compacted.

Slag: Partially fused or vitrified nonmetallic material released and formed by chemical action at

high temperatures during the smelting and refining of metals. 

Solid Waste: Refuse and trash that requires routine or irregular collection and transport to a

processing and/or disposal site.

Source reduction (waste minimization): The reduction of waste, through processing changes

or recycling at the source.

Special waste: Any of the industrial process, pollution control, or hazardous waste materials,

including potentially infectious medical waste, except as may be in conformity applicable laws.

with Section 22.9 of the Resource Conservation and Recovery Act (RCRA).
F-6

Stabilization process: Altering an active substance into inert, harmless material. Also, limiting

the further spread of contamination without actual reduction of toxicity at a given site.

Storage: Holding waste for a temporary period, after which the waste is treated, disposed of, or

stored elsewhere.

Surface impoundment: Any natural or man-made topographic depression, hole, or

embankment that is composed primarily of earth materials and used to treat, store, or dispose of

hazardous waste.

Tipping: The discharge of waste from the collection vehicle.

Tipping fee: Fees charged to haulers for delivering waste at recovery or disposal facilities.

Transfer station: A facility that receives solid waste from individual collection trucks and

consolidates the waste into larger shipping containers, such as tractor-trailer units, for longdistance shipping to waste processing plants. Typically such waste processing plants are located

more than 12 miles from the community in which the waste was collected.

Treatment: (1) A systematic process for removing solids and/or pollutants from solid waste,

waste-streams, effluents, and air emissions. (2) Any method used to remove or reduce potential

disease-causing components from regulated medical waste by changing the biological

composition of that waste material.

Underground injection (or deep-well injection): The process of placing raw or treated,

filtered hazardous waste in the pores of permeable subsurface rock by pumping it into deep

wells.

Waste generation: The weight or volume of material entering the waste stream before said

waste is disposed of or recycled. The phrase can be applied to the amount of waste produced by

a specific source or category of sources.

Waste management: The process of collection, storage, treatment, or disposal of waste, not

including hauling or transport.

Waste minimization (source reduction): The reduction of waste, through processing changes

or recycling) at the source.

Waste stream: The flow of all solid waste from point of generation to method of disposal, such

as incineration, depositing in landfills, or recycling. The term may also apply to segments of the

waste flow, such as “residential waste stream” or “recyclable waste stream.” 

Waste-to-energy: A usable form of energy that is manufactured (primarily by combustion)

from solid waste.