The development of a diverse industrial sector is an important element to economic growth. At the same time, especially the manufacturing sector emits a diverse set of pollutants to the environment that – if not assessed and abated efficiently – can lead to environmental, social and economic damages that might outweigh the benefits of individual industries on the medium and long term.

To enable national authorities to exercise efficient pollution control, assessment of the composition of the manufacturing sector of a country, and its geographic clustering, is a critical first step to identify hotspots of potential pollution to inform the development of national pollution control strategies, budgeting of monitoring and enforcement, and technology investments.

One method to perform such a strategic level assessment of the composition of a countries’ manufacturing sector is the World Bank Industrial Pollution Projection System (IPPS). It was developed  in 1992 to estimate the emissions of key pollutants from the manufacturing sector in countries where pollution control is limited or doesn't exist. A central component of the IPPS is the International Standard Industrial Code (ISIC) which describes the type of activity of an enterprise which are linked specific pollution coefficients.

The application of the IPPS for the Greater Mekong Subregion includes two innovations:

1. Development of an ISIC compatibility matrix (Rev4 to Rev3.1 to Rev2) can significantly reduce the conversion effort and risk of conversion errors. This was necessary since IPPS was originally developed in 1992 using ISIC Rev.2, but present national enterprise databases use the more recent ISIC Rev.4 codes, which is not fully compatible with the older Rev2 codes.
2. Mapping of the IPPS results to enhance and deepen the analysis with information on geographic distribution and concentration of polluting activities.

Selected examples of the application of IPPS in the Greater Mekong Subregion are found in the ADB publication ‘Projecting Industrial Pollution in the Greater Mekong Subregion’ (hyperlink: https://www.adb.org/publications/projecting-industrial-pollution-gms)

Citation: ISIC conversion matrix: GMS Environment Operations Center (www.gms-eoc.org); IPPS coefficients: Hettige, Hemamala, Paul Martin, Manjula Singh and David Wheeler, "The Industrial Pollution Projection System (IPPS)," Policy Research Department Working Paper 1431, World Bank, Washington, D.C., March 1995.