Over the next decade, investments in clean technologies in emerging markets are estimated to exceed $6 trillion, of which $1.6 trillion represent business opportunities for small and medium enterprises (SMEs), according to a new report by infoDev/World Bank Group in collaboration with the Carbon Trust.
The report, Building Competitive Green Industries: the Climate and Clean Technology Opportunity for Developing Countries, identifies China, Latin America and Sub-Saharan Africa as the top three markets in the developing world for clean technology SMEs, with an expected market size of $415 billion, $349 billion, and $235 billion, respectively. The most promising opportunities are in wastewater treatment, onshore wind, solar panels, electric vehicles and small hydro.
Data analysis and case studies from Kenya and India show how these market opportunities also have important social impacts. In Kenya, for instance, the roughly 80 percent of the population not served by the electricity grid represents a vast market for new climate and clean technology solutions. Local entrepreneurs and SMEs are deriving innovative solutions in solar and biogas technologies.
The report, published by infoDev, a global innovation and entrepreneurship program in the World Bank Group, also highlights the important link between competitive green industries and job creation. Clean technology jobs compare favorably to jobs in other sectors, requiring more skill and delivering better pay and on-the-job safety.
To help countries realize this environmental and economic potential, the report, the Carbon Trust provided technical analysis and identified a set of actions that can be implemented to build local green industries. The study provides a range of practical instruments to support SMEs in key areas such as market development, innovative finance, entrepreneurship and business acceleration, technology development and the legal and regulatory framework.
Developing regions, particularly certain areas of Africa, are seen by many as being primed for an economic boom. In recognition of this fact, SAP in August announced it will invest up to $500 million through 2020 to train local talent and drive sustainable innovation and growth in Africa, with the overall goal of establishing the continent as one of the company's top-five global growth markets. Much of the direct investment will be outside South Africa, where SAP already has a solid footprint. This will include SAP operations across 51 African countries, including Morocco, Algeria and Tunisia, and Mauritania.
This week, Unilever and the UK government launched a joint initiative to use new social business models to improve health, hygiene and livelihoods for 100 million people by 2025. They will also each contribute more than $8 million to a research and innovation program focused on affordable sanitation and safe drinking water.