8/8/2007

Cape Town, South Africa — Challenging water issues and the presence of substantial quantities of salt and brackish water are encouraging Southern, East African and Indian Ocean Island water managers to consider desalination technology as an alternative source of fresh water. Moreover, the growing demand for potable and industry-quality water is increasingly leading both governments and private organisations to adopt this technology.

New analysis from Frost & Sullivan Southern, East African and African Indian Ocean Island Desalination Plant Markets, finds that uneven and inconsistent water supply is a significant issue faced by countries in this region. In some extreme cases, fresh water shortages have shut down industries and left local populations without a source of potable water. Desalination technology provides these countries with a water supply option that is not impacted by changing weather patterns and water scarcity.

“Each of these water markets has substantial coastlines and in some cases groundwater supply, which is why these countries have and are considering desalination technology,” explains Frost & Sullivan Research Analyst David Winter. “Some industrial end users have installed their own desalination plants to ensure adequate process water supply, while municipalities have also turned to this technology.”

However, a significant challenge for plant suppliers is the cost of desalination technology. Despite a significant reduction in membrane costs, these less developed economies and their end users typically do not always have the financial resources to finance such plants.

Hence, governments in these markets are reliant on financial aid from international aid organisations such as the World Bank for infrastructural projects, which includes the supply of potable water. The same is true for the private sector. Apart from large multi-nationals, industrial and commercial end users typically do not have the resources to finance such projects.

However Frost & Sullivan believes that growth opportunities exist for companies that can overcome the financial restraints that exist amongst end users. The water supply issues present in these markets have reached a point where end users need to solve their potable water issues and desalination may be able to provide the answer.

“Assisting end users with the sourcing or structuring of finance or identifying more cost-effective options could have a significant impact on market growth,” says Winter.

SOURCE: Frost & Sullivan