Sustainability: A lever for economic growth

DISCLAIMER: All opinions in this column reflect the views of the author(s), not of EURACTIV Media network.

Investing in sustainable industries is a win-win situation that will boost the much-needed growth in the EU while creating a sustainable and eco-friendly environment, writes Antonio Tajani, commissioner for industry and Entrepreneurship.

Antonio Tajani is vice president of the European Commission and commissioner for Industry and Entrepreneurship. This commentary was first published here in 'Making It'.

"One of the biggest societal challenges facing the European Union (EU) in these times of financial and economic crisis is how to deliver much needed growth and jobs, while doing the right thing by the planet. This is a challenge that by no means is isolated to the EU. The economic and environmental mechanisms are globally interlinked, and what happens on one side of our globe can have dramatic consequences on the other side of the planet.

Acknowledging that, to a large degree, we share the same challenges, and that our actions have an impact on other nations, we also have an opportunity to learn from each other and create new global markets. The smarter development of our industries and technologies in Europe will make us better equipped to combat the pressure on resources, an ageing population, climate change, and a threatened environment. But, first and foremost, setting up the right conditions for investment in promising sectors will foster the immediate recovery from the crisis.

As commissioner for Industry and Entrepreneurship, I am proud to spearhead the making of an even stronger and more competitive European industry. The Commission’s Europe 2020 strategy sets out a vision of how we can turn the European Union into a smart, sustainable, and inclusive economy, with strong growth rates, delivering employment, productivity, and social cohesion.

With sustainable growth being one of the three priorities of Europe 2020, we want to promote a more resource-efficient, greener, and more competitive economy. In doing so, we try to keep our heads clear when assessing the impacts of our policy actions. We must ensure that green is compatible with – and does not compromise – growth.

Sustainable industry should not be perceived as the domain of certain environmental industries. It has, on the contrary, become the business of all businesses. The transition to more sustainable means of production, or more sustainable products and services, can offer opportunities, but we must keep in mind that it requires a prior investment, which may not be affordable in the short term.

We are therefore striving to make clear, coherent, and well-conceived industrial, climate, energy, and related policies that promote eco-innovation, without leading to industrial outsourcing and the loss of jobs and prosperity. And it is for this reason that, in 2011, we launched the Sustainable Industry Low Carbon Initiative, which is a practical, industry-based initiative at EU level for ‘traditional’ manufacturing industries, aiming to stimulate innovation to reduce the carbon intensity of energy-intensive manufacturing processes.

Opportunities in sustainable growth and resource efficiency

Finding solutions that neither compromise growth nor the climate and environment is – I must admit – not always an easy task. But although at first this merging of interests might seem like a marriage of convenience, we often see that many of them turn out to be fruitful relationships. There is, in fact, a growing tendency among businesses to produce in more resource-efficient ways. These businesses are not necessarily driven by a desire to invest in a greener planet, but they make changes to their business concepts because green production has become economically sound.

Indeed, industry is a core driving force behind the technical and technological innovation required for greater sustainability and resource efficiency. Although eco-innovation remains under-exploited, public and private investment in this area in the EU has continuously increased over the last 10-20 years.

The eco-industries sector has grown to become a sector equivalent (in terms of employment) to chemicals or electrical and optical equipment. Annual employment growth in this sector between 1999 and 2008 has averaged approximately 180,000 jobs per year, representing over 7% annual growth, and in 2008 it was estimated to employ 3.4 million people across the EU.

Furthermore, our 2020 energy goals can result in €60 billion less in oil and gas imports, and over 1 million new jobs in the field of renewable energy and energy efficiency.

A key driver for sustainable industry is the Commission’s product policy. The first nine measures under the Eco-design and Energy Labelling Directives are expected to reduce annual energy consumption by some 340 TWh by 2020. This is equivalent to 12% of the total electricity consumption in the European Union or the entire electricity consumption of Italy in 2007.

Whereas some sectors will meet few barriers in changing to a more sustainable production, others will be confronted with high investment costs in new technologies and innovation. This is especially a problem for small and medium-size enterprises (SMEs) which lack time, information, and human and financial resources and miss out on the opportunities offered by efficient products and services in terms of a reduced energy bill and greater effectiveness. In February 2011, the Commission revised the so-called ‘Small Business Act’, and shifted the focus to helping SMEs with the transition to resource-efficient growth.

The future of European sustainable industrial policy

Additional investments will be needed if European industry is to move further in the direction of resource efficiency. The starting points vary widely in different European regions. This is why the Commission is supporting investments in infrastructure, and is helping to kick-start economic development in the different regions.

Finding new ways to reduce inputs for manufacturing industry, to improve management of resource stocks, to optimise production processes, and to make the best usage of waste, are just some examples showing how increasing resource efficiency can also bring economic opportunities for companies. This will help stimulate technological innovation, boost employment in the fast developing green technology sector, and open up new markets.

It is important to me and to my colleagues in the Commission to be open to new ideas and to consider new ways of dealing with our economic and environmental challenges. It is, after all, my first and finest priority to work for a flourishing and viable European Union – a competitive society which leaves a healthy environment for future generations."

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