According to a new report from World Bank Group, there are significant clean tech opportunities for small and medium-sized enterprises (SMEs) in developing countries. The new report, “Building Competitive Green Industries: the Climate and Clean Technology Opportunity for Developing Countries,” frames responding to climate change as an extraordinary economic opportunity, particularly in developing countries. The report, published by infoDev, recommends actions by the public and private sectors to foster the growing market for SMEs in the clean technology sector.
“Fostering home-grown clean-tech industries in developing countries can create a sustainable and wealth-producing sector of the economy,” said Anabel Gonzalez, senior director for the World Bank’s Global Practice on Trade and Competitiveness, “While simultaneously addressing such urgent development priorities as access to clean and affordable energy, clean water and climate-resilient agriculture.”
In just the last decade, clean technology has emerged as a major global market. Over the next 10 years, an estimated $6.4 trillion will be invested in developing countries. Of the total market in developing countries, some $1.6 trillion will be accessible to SMEs, according to the report. China, Latin America and Sub-Saharan Africa are the top three markets in the developing world for SMEs in clean technology, with expected markets of $415 billion, $349 billion and $235 billion, respectively for sectors such as wastewater treatment, onshore wind, solar panels, electric vehicles, bioenergy, and small hydro.
More can be done to support green entrepreneurship. As sited in the report, clean technology SMEs face daunting challenges, particularly in accessing early and growth stage financing. Countries can help by creating targeted policy incentives to encourage their own clean technology sectors. The report provides policymakers with a range of practical instruments that help support SMEs in clean technology sectors such as innovative finance, entrepreneurship and business acceleration, market development, technology development, and the legal and regulatory framework.