Wallström green plan risks ‘ruin’ for smaller firms

Date: 25/01/01

By Laurence Frost

PLANS to make goods and services across the EU more eco-friendly have prompted warnings that smaller firms could be threatened with financial ruin.

Small and medium-sized enterprises (SMEs) are already voicing concerns that a proposal in the European Commission's new green action plan for an 'integrated product policy' is not backed by concrete pledges of technical or financial help.

"Many will be obliged to close down if it's just left to market forces," said Guido Lena of the European small business lobby UEAPME.

The measure is a cornerstone of the Sixth Environmental Action Plan unveiled by Commissioner Margot Wallström this week. It promises 'economic incentives' to boost demand for environmentally-friendly products, combined with new green procurement criteria for government departments and companies, both public and private.

But small businesses say they could lose out to multinationals in the battle for sales unless firmer steps are taken to prepare them for the changes.

"We're concerned that not enough attention is paid to SMEs in the action plan," Lena said. "Small businesses are not bonsai versions of big businesses - they have totally different structures and needs. You can't just apply the same legislation. You need logistical and financial support."

But green groups say the action plan goes far enough to accommodate business. "These are market opportunities for the providers of ecological products and services, many of whom are SMEs," said a spokesman for the European Environmental Bureau (EEB).

The plan's emphasis on partnerships with business and the use of market mechanisms to encourage consumers' environmental awareness has led to charges of a 'sell-out' to industry.

But Wallström defended her 'stakeholder' approach at a conference hosted by the Friends of Europe think-tank in Brussels this week. "We can't reach our goals unless we have a dialogue with business," she said. "If we're to meet the big challenges we must mobilise on a broad scale."

But environmentalists are still unhappy with the lack of concrete targets and commitments - in particular the preparation for further reductions in greenhouse gas emissions after 2012, the deadline for implementation of the Kyoto climate change agreement.

"We're not against talking to business," said EEB secretary general John Hontelez. "But it would have been better to have firm targets - once you have the targets, there's something to talk to business about."

Plans to make goods and services across the EU more eco-friendly have prompted warnings that smaller firms could be threatened with financial ruin.