ANNUAL REPORT Ministry of Industry and Handicrafts. Lao Cleaner Production Programme. Swiss Government State Secretariat of Economic Affairs

Transcription

1 Ministry of Industry and Handicrafts Lao Cleaner Production Programme ANNUAL REPORT 2005 Government of Lao PDR Ministry of Industry and Handicrafts Swiss Government State Secretariat of Economic Affairs United Nations Industrial Development Organization

2 FOREWORD Lao Cleaner Production Program A few years ago, the Ministry of Industry and Commerce undertook basic training activities in Cleaner Production for some of its personnel, with support from DANIDA. This project showed that Cleaner Production is an effective tool to increase the competitiveness of the Lao industry, while at the same time reducing the negative impacts it has on our environment. In view of the coming into effect of the ASEAN free trade agreement in 2008, it is now time to step up our efforts and promote a broader application of Cleaner Production within our industry, in order to ensure that our companies and factories produce good quality products at a suitable price and in a clean and environmentally friendly way. Only so will they be able to grow in an increasingly open and competitive economy. The government of the Lao People's Democratic Republic is thankful to the Swiss Government and the United Nations Industrial Development Organization (UNIDO) for their support in establishing the Lao Cleaner Production Programme, and I am confident that the project will lay the foundations for the establishment of a permanent Centre for the promotion of cleaner production and modern industrial practices in our country. The industrial base of Lao PDR is still modest, but it is growing at a fast and sustained pace. This is the perfect time for introducing cleaner production concepts that will help the country transform its industrial base into one that is productive, competitive and well integrated into international and local markets, and at the same time ensures a sustainable and equitable economic development for its people. Important elements of such industrial development are that it be efficient in its use of material and energy inputs, and that it respect social (worker health and safety) and environmental standards. The Lao CPP is still young, but the present report shows that it has already achieved significant results during its first year of operation and the outlooks for 2006 are even more promising. I would like to take this opportunity to thank the whole team of the Lao CPP for their hard work, as well as the international experts, the National Project Director and supporting staff of the Ministry of Industry and Commerce. But most of all, I would like to thank the companies that took part in our programme. They have shown that continued commitment and efforts is what matters most for improving a company's operating practices and achieving impressive results. Mr. Soutchay Sisouvong National Project Director Lao Cleaner Production Programme Dr. Heinz Leuenberger Chief Technical Adviser Lao Cleaner Production Programme

3 CONTENTS FOREWORD... 2 CONTENTS INTRODUCTION THE PROJECT Vision, mission, goals and activities... 5 Vision... 5 Mission... 5 Goals and activities Target beneficiaries ORGANIZATION AND FACILITIES Overview Organizational structure Advisory Board Staffing Counterpart and Networks Capacity-building for the Lao CPP staff Facilities MAIN ACTIVITIES Training In-Plant Demonstration Programmes Some results Awareness Raising and Information Dissemination Seminars Presentations Publications CLEANER PRODUCTION... More profit, less waste, and much more! Cleaner Production (CP) is the continuous application of an integrated preventive environmental strategy to processes, products and services in order to increase ecoefficiency and reduce risks to humans and the environment. For production processes: CP includes conserving raw materials, chemicals, water and energy, eliminating the use of toxic chemicals and reducing the quantity and toxicity of all emissions and waste generated during each process. For products: CP focuses on reducing environmental impacts through each stage of the product s life cycle, from raw material extraction to its ultimate disposal, including packaging design. For services: CP is to incorporate environmental concerns when designing and delivering services. Cleaner production requires changing attitudes, exercising responsible environmental management and evaluating technical options. (Adapted from UNEP - DTIE)

4 Lao Cleaner Production Program MoUs signing between the Lao CPP and the factories participating in the 2005 Demonstration Programme. 1 INTRODUCTION In its socio-economic development plan , the government of the Lao People s Democratic Republic puts the emphasis on poverty reduction with the view to lift the country from its least developed status by Increased industrialization will play a key role in achieving this objective. Indeed, only such industrialization can provide work to the growing numbers of Laotians coming onto the labour market and create the wealth that will lift the population out of poverty. However, as the country increases its industrialization, it is critical to ensure that this occurs in a way that minimizes the consumption of scarce and expensive natural resources and the pollution of the country s natural environment. In addition, a significant part of the country s industry is exportoriented, and the Government plans to continue its export drive. It is thus important to ensure that Laotian export-oriented industries are competitive in international markets. Cleaner production activities in Lao PDR will assist companies to meet both these environmental and trade-related challenges. By reducing resource consumption and waste and pollution generation, by switching to less hazardous materials, and by increasing worker productivity, cleaner production allows enterprises to be more efficient, more cost-effective, and more competitive while simultaneously improving their environmental and social performance and reducing their environmental impacts. Cleaner production activities have already started in Lao PDR. With support from DANIDA, the Ministry of Industry and Commerce (MIC) undertook in 2001 and 2002 some basic training on cleaner production concepts for a small team of its personnel. In coordination with the Ministry, it is now time to fully involve the country s industry, which will be the main motor for cleaner production. The Lao Cleaner Production Programme (Promotion of Cleaner Production Programme in Lao) aims at fulfilling this task. Established in 2005 in response to the request of the Government of Lao PDR, the Programme was started as a UNIDO project for the "Promotion of Cleaner Industrial Production in the Lao People s Democratic Republic". The project is funded by the Swiss Government through the State Secretariat for Economic Affair (SECO) and located at the Ministry of Industry and Commerce. 4 Lao Cleaner Production Programme

5 Dr. P. K. Gupta explaining the modified washing technique using counter current cascade rinsing to Nikon Handcraft Centre staff to reduce water consumption. 2 THE PROJECT 2.1 Vision, mission, goals and activities Vision The Lao Cleaner Production Programme (Lao CPP) aims at becoming a national and independent Centre of excellence for promoting the adoption of CP and sustainable industrial practices in Lao PDR. Mission The Lao CPP promotes the sustainable application of CP in order to increase the efficiency and competitiveness of the national industry and to reduce risks to humans and the environment. It is a focal point for CP activities, provides services to the private and public sector, creates local capacity, coordinates the different national CP efforts and contributes to establish the legal framework to facilitate the promotion of CP. Goals and activities Recognizing that cleaner production knowledge and efforts in Lao PDR are still in their infancy, the initial goal of the project is to introduce more of the country s industry to cleaner production concept, benefits, methodologies and techniques. The garment sector was selected for demonstration in 1 st year and other sectors short listed for next years, will be wood processing sector and sub-sectors within the food processing sectors In order to reach this goal, the Lao CPC will: Train and raise awareness of key stakeholders: industries, government decision makers, academic institutions, NGOs, and private consulting companies in CP basic strategy, needs, benefits, techniques and methodology; Carry out CP assessments and demonstration programmes in industries as an effective tool for promoting multiplier effect of CP in the country; Cooperate and assist Lao National University in integrating CP techniques and technologies and other related topics in its curricula; Annual report

6 Lao Cleaner Production Program Cooperate with international organizations with the aim of supporting the implementation of CP and the mitigation of environmental impacts in the country; and Serve as National Focal Point of the UNIDO/UNEP Network of National Cleaner Production Programmes. The activities of the Programme will cover the following topics: Production efficiency as well as environmental performance; Product development as well as process change and development; Technology change as well as management change or management attitudinal change Active role in promotion of higher levels of worker health and safety as well as the reduction of environmental impacts; Support to companies for accessing international as well as local markets; Interfaces with quality; Energy efficiency. A further goal of the project is to ensure the sustainability of CP activities after the end of the project. As part of the issue of sustaining cleaner production, an assessment will be made about the possibility to transform the current project into a permanent CP Centre, to be hosted by an institution that is close to industry. 2.2 Target beneficiaries Small and Medium-sized Enterprises (SMEs) will be the particular focus of the Lao CPP. As a result of the project, they will reduce their emissions, achieve monetary savings and have increased access to more modern and cleaner technologies. Export-oriented companies in particular will benefit from the project, since they will be able to access international markets more effectively, using cleaner production methods to respond to demands regarding improved environmental and social performance from their international clients while remaining, and in most cases becoming even more competitive. Industrial and environmental policy-makers will benefit due to their improved awareness of cost-effective ways of increasing industrial efficiency and productivity while at the same time reducing environmental pollution, both for existing industrial enterprises as well as for future industrial projects that are due to be set up in the country. Consultants who will have their skills in cleaner production assessment upgraded will benefit from the increased opportunities to market their services. Finally, the Lao people and the country s eco-system will benefit from the reduced load of environmental pollutants as a result of the industry s cleaner production efforts. The Lao people will also benefit from the potential for more employment, since more efficient companies accessing international markets have greater possibilities to expand their business. 6 Lao Cleaner Production Programme

7 The Lao Cleaner Production Program Team and International CP Experts. 3 ORGANIZATION AND FACILITIES 2005 was the first year of operation of the Lao CPP. The Project Management Unit was established and equipped with adequate facilities, organizational structure and human resources, with the support of the Chief Technical Adviser and in close cooperation with the hosting institution, the Ministry of Industry and Commerce. 3.1 Overview Project office space, was provided and renovated by the Ministry of Industry and Commerce; Access to internet and telephone communications were established; Office equipment and furniture were purchased and put in operation; A library was established; The Advisory Board has been established; Four factories signed a Memorandum of Understanding with the Lao CPP for in-plant demonstration programmes; A work plan for 2005 has been developed and implemented. 3.2 Organizational structure The organizational structure of the Lao CPP is as follows: Annual report

8 Lao Cleaner Production Program Ministry of Industry and Handicrafts Dept. of Industry, Dept. Handicrafts, Dept. of Electricity, and Dept. Geology & Mine National Project Director UNIDO Cleaner Production Program Swiss Government: State Secretariat for Economic Affairs (seco) International Technical Reference Institution Project Chief Technical Advisor (CTA) National Project Coordinator Project Deputy Advisory Board Interpreter / Translator National experts and counterparts In plant Assessments Training Information Dissemination Network of National Cleaner Production Centers 3.3 Advisory Board The project activity is overseen by an Advisory Board consisting of 15 members from the various line Ministries and line Agencies: Ministry of Industry and Commerce (MIC), Ministry of Foreign Affair (MOFA), Lao National University, Science Technology and Environment Agency (STEA), Ministry of Trade, Department of Finance, National Chamber of Commerce and Industry, Committee for Investment Promotion, UNIDO/SECO. H.E Somboun Rasasombath, Vice Minister of the Ministry of Industry and Commerce is the Chairman of the Advisory Board. 3.4 Staffing The Ministry of Industry and Commerce has appointed Mr. Soutchay Sisouvong, Deputy Director-General of the Department of Industry, as National Project Director (NPD) of the Lao CPP, to serve as the overall government manager of the project. The Lao CPP comprises three full-time staff members: the National Project Coordinator, the Project Deputy and one translator/ interpreter. Dr. Heinz Leuenberger has been appointed by UNIDO as part-time Chief Technical Adviser of the project, while seven CP team members from the Ministry are also providing part-time support to the Programme. 8 Lao Cleaner Production Programme

9 Project Management Unit's staff members No Name Position in Project 1 Dr. Heinz Leuenberger Chief Technical Advisor h.leuenberger@unido.org 2 Virasack Chundara National Project Coordinator laocpc@etllao.com 3 Thongphet Phonsavath Deputy Project Coordinator pthongphet@yahoo.com 4 Khamla Sayavong Translator khamlasayavong@yahoo.com 3.5 Counterpart and Networks To strengthen the capacity of the human resources and facilitate in plant CP assessment implementation, the Lao CPP has established long-term cooperation and networking with other CP Programmes, especially with Vietnam Cleaner Production Centre and National Cleaner Production Centre, India. The Lao CP Programme is also working closely with the University of applied Life Sciences, Nordwestschweiz in Switzerland (FHNW, previously Fachhochschule beider Basel - FHBB), and Lao National University (Centre of Social Study and development). 3.6 Capacity-building for the Lao CPP staff In order to help in the demonstration programmes and other training activities, the Project Coordinator attended an in-depth CP Training Programme for food processing in Muttenz, Switzerland 27 August 9 September 2005, organized by FHBB (now FHNW). Other training activities are planned for both Project Coordinator and Deputy in The participants of the CP Training Programme for food processing in Muttenz Annual report

10 Lao Cleaner Production Program 3.7 Facilities The Lao Cleaner Production Programme disposes of the equipment and monitoring devices required to conduct in-depth CP assessments in companies. These include equipment for measuring materials, energy and key process parameters (T, ph, conductivity,...), as well as equipment for measuring pollution (water analysis, dust,...) and working conditions that can affect health of employees working at factory premises, as well as their productivity (noise, light). The Lao CPP also has its own library with books and reports on cleaner production and other relevant fields: UNIDO Cleaner Production Toolkit, Textile Wet Processing, Management of Hazardous Substances and Goods, as well as an Electronic Cleaner Production Library. Next year, the Programme will print more books and reports from cleaner production CDs and from the Internet. The library is accessible to all interested stakeholders. The Lao CPP disposes of a small laboratory and portable equipment for stack gas analysis, energy measurement, water analysis, etc. 10 Lao Cleaner Production Programme

11 Dr. Gupta teaching basics of CP to company staff during the kick off meeting. 4 MAIN ACTIVITIES 2005 During its first year of operation, the Lao CPP has focused its main activities on: Training; In-Plant demonstration Programmes; Awareness raising and information dissemination. All these activities are interrelated and strongly support each other. 4.1 Training The objective of trainings is to give industry personnel the necessary skills to carry out cleaner production assessments, and to create a solid core of national experts that can continue the work of disseminating cleaner production to the Lao industry after the project is completed. The training programmes also serve to trigger interest among selected industrial and handicrafts establishment in priority sectors and convince management to participate in the related CP demo programmes. The cleaner production involves a series of step by step procedures to analyse production processes of industries or handicrafts establishments in order to increase the production efficiency while at the same time minimizing the generation of wastes at the source. In 2005, the Lao CPP has started to train CP trainers with a systematic, in depth training programme consisting of 4 modules (see table below). During the programme, participants go step by step through a complete cleaner production assessment, coached by international experts. The programme is directly linked to the in-plant demonstration programmes. This allows the trainees to acquire both theoretical and practical knowledge in cleaner production. A selection of these trained national experts will serve as CPtrainers/coaches in the following years and some of the trainers will work as independent consultants on cleaner production once the programme is completed. The priority target group for these trainings is industry, but branch organizations such as industry associations and chambers of commerce, consultants, government officials, research institutes, financial institutions, and universities are also targeted. Annual report

12 Lao Cleaner Production Program Trainings work plan (organized and facilitated by international experts): Modules Module 1 Vientiane Capital Module 2 Vientiane Capital Module 3 Vientiane Capital Cleaner Production Methodology 28 March 1 April days & company practice Introduction to cleaner production Textile and Garment industries Cleaner Production Assessment Getting started Analysing process Material balance Boiler efficiency Generating cleaner production options Cleaner Production Assessment May days & company practice Generation of preassessment Discuss results and problems Case studies to illustrate methodologies Best Available Technologies in Textile and Garment Industries Cleaner Production Assessment August days & company practice Presentation of assessment Discuss result and problems Best available technology Implementation of CP options Module 4 Vientiane Province Completion of Cleaner Production Assessment 7-10 November days & company practice Presentation of assessment and status for implementation Cleaner production investment In line with this schedule, 17 days of training were delivered in In the course of the programme, the actual agenda of each module was adjusted based on the feedback and evaluation of the previous module. 151 participants took part in the training. 51 participants were coming from Government agencies and industry associations, 77 from industries and 23 from academic institutions, research and consulting companies. The distribution of the participants is shown in figure 1. 15% 34% Government & Industry associations Industry University, research & consultants 51% Figure 1: Distribution of participants in the four-modules training programme National experts and industry representatives participate actively during the training sessions 12 Lao Cleaner Production Programme

13 Dr. Heinz Leuenberger and the Lao CPP team visiting Inter Export factory during the 2005 Demonstration Programme. 4.2 In-Plant Demonstration Programmes In-plant demonstration programmes aim at showing Lao industries practical examples of how the concept of cleaner production can work and what its benefits are. Moreover, they provide opportunities for hands-on training to the participants of our training courses. As planned in the Project Document, the first demonstration programme focused on the textile sector. Four export-oriented companies were selected as CP demo units: Inter Export Company, Export Garment Factory, Nikon Handicrafts Centre and UKs Printing Company. Four national experts were selected and contracted to assist the companies during the demonstration programme, under the supervision of the Lao CPP team. They were supported by two international experts (Dr. P. Gupta, India, Mrs. Tuong Anh, Vietnam) and by the CTA of the project, Dr. Heinz Leuenberger. The CP demonstration programme consisted of four modules combining class room training with on-hand field experience through conducting CP demo in selected companies. At the beginning of the programme, CP teams were established in all participating companies. Between the different training modules, the CP teams conducted step-by-step full CP Assessments (CPA) in their companies, with the support of the national and international experts. The demonstration programme was thus conducted as interactive classroom training sessions combined with practical training in companies. Data collection is one of the most critical tasks that had to be done by the CP teams. In order to facilitate this task, the Lao CPP installed some monitoring equipment such as water meters and electric meters in selected CP demo units with the support of Mr. Jürg Schmidlin, master degree student at the University of applied Life Sciences, Nordwestschweiz in Switzerland (FHNW). In addition to the in-plant assessment, the CP teams also evaluated Best Available Technologies (BAT) and Environmentally Sound Technologies (EST) that are suitable for introduction as the technical part of the CP options. This required international contacts and a sound overview of technical options in order to be able to provide the company with environmentally sound production technology information in their sector. Annual report

14 Lao Cleaner Production Program The CP Teams then wrote complete CPA-Reports according to a standard template. These reports will be reviewed and finalized in the first half of This will allow to include data on the actual savings achieved by the programme after implementation of the selected CP improvement options. Checking process dyeing bath temperature and power factor of motors at Export Garment factory Some results Outcome of the project in terms of experiences gained, results achieved and shortcomings experienced are linked with the envisaged demo objective. Practical Demonstration of economic and environmental benefits A wide range of CP measures were identified by CP team of 4 participating demo units and 24% of identified and > 40% of agreed options were implemented during the project period indicating fairly good acceptability of CP strategy by the management of participating companies. Technical, financial and environmental analysis presented in tables 1&4 reflects the effective attractiveness both in terms of financial gains as well as environmental savings. TABLE:1 TECHNICAL FEASIBILITY ANALYSIS COMPANY TOTAL NO. OF CP OPTIONS IDENTIFIED FEASIBILITY ANALYSIS REQUIRES FURTHER ANALYSIS NOT FEASIBLE DIRECTLY IMPLE- MENTABLE EXPORT GARMENT INTER EXPORTGARMENT UKS PRINTING CO Ltd NIKONE HANDICRAFT TOTAL NO Percentage 100% 76% 19% 5% 14 Lao Cleaner Production Programme

15 More than 2/3 options were obvious and directly implementable generally categorized under Low Hanging Fruit (LHF) category requires no detail feasibility analysis for implementation. TABLE 2: FINANCIAL ANALYSIS OF CP OPTIONS 77% of the identified measures were low cost requiring less than 1000 US $ investment for implementation & 81% measures have a payback period of less than one year. A total reported investment of US$ 35,500 to implement 47 measures resulted into direct savings of US$ 55,200 having overall payback period of less than 1 year. Update information on current implementation status will be reviewed every 6 months. TABLE 3: ENVIORNMENTAL IMPACT OF IMPLEMENTED MEASURES COMPANY TOTAL NO. OF CP OPTIONS WASTE WATER VOLUME ENVIRONMENTAL IMPACT % REDUCTION ORGANIC POLLUTION LOAD (COD &BOD) GASEOUS EMISSIONS/ GHG SOLID WASTE TOTAL COMPANY NO. OF INVESTMENT COSTS PAY BACK PERIOD CP OPTIONS LOW MEDIUM HIGH SHORT MEDIUM LONG EXPORT 55 GARMENT INTER- 92 EXPORTGARMENT UKS PRINTING CO. 28 Ltd NIKONE 24 HANDICRAFT TOTAL NO Percentage 100% 77% 15% 8% 81% 15% 4% EXPORT 12 GARMENT 35% NQ 80%(GHG) NQ INTER- 12 EXPORTGAR MENT 30% NQ NQ NQ UKS PRINTING CO. 50% 60% 90%(solvent 30 Ltd emissions) NIKONE 9 HANDICRAFT 60% NQ 65% NQ TOTAL NO. 47 Percentage 24% 30-60% Upto 60% Upto 90% Upto 30% Annual report

16 Lao Cleaner Production Program Implementation of 47 mostly low cost/no cost options has contributed significantly to environmental improvement in areas like significant reduction in wastewater volumes (30-60%), organic pollution load up to 60%, air emissions up to 90% (including reduction in fugitive emissions) and estimated reduction up to 30% in solid waste generation A notable result in demo unit was improved working environment due to improved shop floor quality and safety. TABLE4: ECONOMIC BENEFITS OF IMPLEMENTED CP MEASURES COMPANY TOTAL NO. OF CP OPTIONS INVESTMENT US $ FINANCIAL ANALYSIS SAVINGS US $ PAY BACK PERIOD EXPORT 12 GARMENT 30,000 50,000 <8months INTER- 12 EXPORTGARMENT 5,000 4,800 <1Year UKS PRINTING CO. 14 Ltd NQ NQ NQ NIKONE 9 HANDICRAFT <!Year TOTAL NO ,500 55,200 < months Some of the conclusions drawn from the results and experiences of demo project are briefly presented below: A. There is little doubt that CP demo results from implemented options as well as projected benefits from to be implemented options has built the momentum of CP in the country as well as project progress. Though in 1 st year of project cost savings rather than environmental improvements remains the key motivating factor. B. More than 2/3 of identified opportunities are obvious requiring no detail feasibility analysis and can be implemented by not only participating units but other similar units in short term i.e. less than 1 year C. Cleaner production programme goes beyond technical modifications, it is also supplemented and complimented by improving resource consumption, better management systems and operating practices. D. Cleaner production benefits. In addition to tangible benefits in monetary & environmental savings has also reflected less tangible benefits like improvement of working conditions, product quality, reduced rejection and reprocessing rates and also up to certain extent local environmental condition around the company. 16 Lao Cleaner Production Programme

17 Dr. Heinz Leuenberger explaining the benefits of CP at the national awareness raising seminar. 4.3 Awareness Raising and Information Dissemination Various activities were held to promote the concept of cleaner production to industries, government agencies, industrial association, consultants, research, and academic institutions. They included an awareness raising seminar, various presentations and the publication of one leaflet and one poster on Cleaner Production in Lao. The awareness-raising seminar was also the occasion to invite the press, and several newspaper articles were published while five TV spots were broadcasted on national television. Seminars To create awareness on cleaner production, the Lao CPP conducted one awareness-raising seminar in persons attended the seminar. 15 participants were coming from Government agencies and industry associations, 44 from industries and 4 from academic institutions, research and consulting companies. Figure 2 below shows the distribution of the participants at the seminar. Three additional seminars were held in the provinces in March % 24% Government & Industry associations Industry 70% University, research & consultants Figure 2: Distribution of participants in the awareness raising seminar Annual report

18 Lao Cleaner Production Program Presentations Representatives from the Lao CPP also gave presentations on cleaner production at two workshops in 2005: Workshop on Trade Promotion Facilitation organized by the Lao Trade Promotion Centre; Workshop on Industrial Waste Management organized by the Department of Industry. In total, the awareness-raising activities carried out by the CCPP reached 180 persons. Publications During 2005, the Lao CPP published one leaflet presenting the services of the Lao CPP and one poster explaining the benefits of cleaner production, both in Lao language. A mini guide on cleaner production has also been translated and will be published in The poster on cleaner production published by the Lao CPP. 18 Lao Cleaner Production Programme