There are two principle markets in Indonesia for environmental technologies, industrial waste treatment and the municipal waste management. Wastes produced from oil refineries, mining sites, and factories are considered industrial waste. Sewers, household garbage, and small commercial are categorized as municipal wastes.
Although Indonesia has fairly rigorous environmental laws, industrial pollution is a major problem because enforcement is absent or lax. As such, pollution control is performed voluntarily. Manufacturers do exercise some control over their emissions. The large multi-national corporations operating in Indonesia usually adhere to relatively high environmental standards, and buy substantial amounts of environmental services and products. While local manufacturers are less willing to spend on pollution controls, their spending habits may change with the implementation of ISO 14000. Although the participation of ISO 14000 is voluntary, many export manufacturers will likely to want to upgrade their environmental standards in accordance with ISO 14000, especially if they want to export to Europe.
Although the industrial waste treatment industry is still in its early stages of development, there are indications that the industrial treatment industry will grow rapidly in coming years. One positive sign in recent years is the willingness of large foreign waste management firms to invest heavily in hazardous waste treatment facilities in Indonesia.
The best prospects for U.S. environmental technologies are in the following industries:
chemical and petrochemical;
electronics (including electroplating);
pulp and paper;
leather tanning/leather products
On the municipal side, the environmental market includes the construction and management of wastewater treatment, water supply, and solid wastes. In recent years, the Indonesian government is banking on a hands-off approach, assigning the private sector a greater role in building up the country’s much needed urban environmental infrastructure. This means American consultant and management firms may not only bid on large environmental infrastructure projects but also provide the financing and manage revenue collection. The new approach will likely translate into greater profit-making potential.