by Carlos David Mogollón, Managing Editor
Without casting aspersions as to those responsible for our economic trouble, the global credit crunch and plummeting stock values have affected everything and everyone.
This being Industrial WaterWorld's “High Purity Water Industry” issue, we just found out the world's biggest drugmaker, Pfizer would cut 800 researcher jobs worldwide (5-8% of its research staff) and limit future R&D to six key areas – Alzheimer's, cancer, schizophrenia, pain, inflammation and diabetes – abandoning new research in other areas. This reinforces comments of Frost & Sullivan's Eric Meliton in this issue's Trends & Technologies column that R&D is being cut back across the pharmaceutical industry, which likely will affect demand for ultra-pure water equipment and services.
We also hear that the respected Ultrapure Journal has ceased print publication, but that it will continue digital delivery of the journal to paid subscribers. Other than “Ultrapure China” (the event was canceled last fall), we're told the move doesn't affect conferences and book sales at Tall Oaks Publishing, whose publications often focus on ion exchange, membrane separation and advanced filtration topics related to the pharmaceutical and microelectronics industries.
On the positive side, as an economic stimulus to combat the global slump, the world is likely to spend 2.9% of its GDP on infrastructure spending in 2009, up from 2.2% in 2008, according to infrastructure projections compiled by Washington DC-based consultancy CG/LA Infrastructure. CG/LA chief Norm Anderson predicts the U.S. portion will amount to about $190 billion, adding that President Obama's proposed infrastructure bank would have to be $300 billion to make a meaningful impact. As indicated in last issue's Viewpoint column, it's not yet clear how much will be dedicated to “water” infrastructure.
UK-based market analyst Global Water Intelligence notes in its recently released Water Market USA report that the credit crunch will cut 12.9% from U.S. water infrastructure spending in 2009, derailing investment plans due to restraints on borrowing, shrinking tax bases and a drop in capital contributions from developers. Still, the report projects longer term growth because of water scarcity, environmental protection needs and repair to decaying infrastructure networks, with annual capital expenditure growth from $25.2 billion in 2009 to $49.7 billion in 2016. Rehabilitating sewer networks will lead in that, followed by wastewater treatment plant upgrades. Desalination, at $130 million in 2008, will grow to over $1 billion by 2015 – the fastest growing segment.
But these numbers were developed prior to the worst of the economic decline last fall. GWI publisher Christopher Gasson offered some more up-to-date thoughts as a guest “Global Talk” columnist in the Jan. 15 WWi International Industry Report e-newsletter, advising those anticipating a bump from the Obama Administration's economic stimulus package to not “expect too much too soon” and putting any tangible effects in the water sector at 18-24 months out.
“This year, 2009 is going to be a year during which there's continuous competition between the good and bad news. The good news will win out in the end, but no one can be sure just how long it will take to prevail,” Gasson said. “Until then, there'll be a lot of politics.”
Regulatory Reports columnist Pat Crow points out the challenges faced by President Obama's “green dream team” will be as stiff as his financial team's due to lower prioritization of a wide range of environmental issues in the last administration. One priority this year will be the federal chemical security program, up for review by the new Congress, and Crow quotes an AWWA official as noting incoming EPA Administrator Lisa Jackson oversaw implementation of the nation's toughest such program while heading the NJ Department of Environmental Protection.
As Crow's commentary didn't leave much room for reporting on recent EPA industrial enforcement actions, I posted a special update to our website that includes details and relevant hyperlinks. Simply search for “EPA Action:” at www.industrialww.com.
I don't envy the Obama Administration the job it faces in rectifying the situation it inherited. We can only hope the new president and his team – in fact, all of us – are up to the task. Everyone will have to be part of the solution.
