Industrial Development: The Critical Role of Small and Medium Enterprises

Thank you, Mr. Chairman.

If you’ll permit me a metaphor, the international community took off on an ambitious journey at the 1992 Rio Summit. From Rio, we flew to Rio+5 and CSD-9 and the Johannesburg Summit. After fifteen years of discussion, I think it’s safe to say we have long since reached our cruising altitude of 30,000 feet and that it’s now safe to walk around the cabin.

At some point, though, to get to our destination, we need to bring this discussion back down to earth. This afternoon, we’d like to continue our effort to shift the focus from 30,000 feet – global policy prescriptions -- to 300 feet – surveying the practical and proven approaches that can make a difference on the ground. Drawing again from the 120-plus case studies in the CSD Matrix, I’d like to highlight another solution that is particularly relevant not only to this afternoon’s discussion of industrial development but also this morning’s discussion of energy issues.

Before I do, however, I want to be clear about why we are highlighting these solutions this week. We are highlighting them because we feel that if each delegation and Major Group focused on scaling up and replicating just one of these solutions, the CSD could be a tremendous success in translating 54 pages of previously agreed language into action. The CSD can add value not by negotiating best practices, but by disseminating and replicating best practices.

As we know, Small and Medium-Sized Enterprises (SMEs) are critically important to the Industrial Development around the world. Therefore one of the positive things that can be done to boost industrial development and increase access to energy services is provide financial and technical assistance to small and medium-sized sustainable energy enterprises that promote the use of clean, efficient, and renewable energy technologies.

Culled from the Matrix we find two examples of successful programs doing just that. In Africa, as a result of the financial and technical assistance work with energy entrepreneurs provided through UNEP’s Africa Rural Energy Enterprise Development (AREED) program, 224,000 people in 44,000 households now have access to cleaner forms of energy. Also through AREED, nearly $2 million has been invested in 31 enterprises. As of the end of 2005, 69% of these investments were current or paid back in full.

In Central America, the Financiamiento de Empresas de Energia Renovable or FENERCA, since 2000 has supported 112 renewable energy enterprises, provided 108,953 people with access to new clean energy services, and mobilized $37 million in financing.

And looking forward, we see other exciting examples of assisting SME’s working in the energy and development field. For example, The Global Village Energy Partnership (GVEP) plans to set up three Regional Energy Access Funds for SMEs – two in Africa and one in Asia. If these funds are fully disbursed by 2009 and 2012, the targets are to assist: 2,000 enterprises (benefiting 1 million people) by 2009, and 7,000 enterprises (benefiting 4.5 million people) by 2012.

To learn more about how you can support energy SMEs in your situation, I encourage you to talk to representatives of the two initiatives we have highlighted here. And, as I hope we will discuss today, I’m sure there are many other organizations out there championing the cause of energy SMEs.

Again, negotiations not required, just the political will and collaboration with those organizations and multi-stakeholder partnerships dedicated to this end.

Thank you Mr. Chairman.