Environment Study EN .Jan22-08mof.gov.eg/MOFGallerySource/English/SME/Research_studies/36.pdf ·...

Ministry of Finance

CIDA Canadian International Development Agency

International Development Research Centre

Egypt/Canada Small & Medium Enterprise Policy Development Project

A Study on Environment as an Aspect of M/SME Policy Development in Egypt

Final Report

By

Megacom

January 2008

Study on Environment as an Aspect of M/SME Policy Development in Egypt Table of Contents ‐ i

Table of Contents

1. Introduction ............................................................................. 4

1.1. Objectives of the Assignment ............................................................ 4

1.2. Background .......................................................................................... 4

1.2.1. Organizations Concerned with Environmental Affairs ............................4 1.2.2. Environmental Elements................................................................................7

1.3. Scope of the Assignment .................................................................... 8

1.3.1. Sectors impacting the environment..............................................................8 1.3.2. Industrial Sector Classification .....................................................................9 1.3.3. Technical Assistance Programs...................................................................11

1.4. Overview of Projects Targeting M/SMEs ...................................... 13

1.5. Our Methodology.............................................................................. 14

1.6. The Project Team ............................................................................... 16

2. International Experience ...................................................... 17

2.1. Organizations Concerned with Environmental Affairs .............. 18

2.1.1. Local Status ....................................................................................................18 2.1.2. Comparative Study (Egypt/ International) ...............................................19 2.1.3. Recommendations.........................................................................................22 2.1.4. Recommendations Summary ......................................................................24

2.2. Law Coverage .................................................................................... 24

2.2.1. Local Status ....................................................................................................24 2.2.2. Comparative Study (Egypt/ International) ...............................................25

2.3. Compliance and Enforcement ......................................................... 26


Study on Environment as an Aspect of M/SME Policy Development in Egypt Table of Contents ‐ ii

2.4. Ranking and Indexes related to Clean Environment................... 33

2.4.1. Local Status ....................................................................................................33 2.4.2. Comparative Study (Egypt/ International) ...............................................34

2.5. Barriers to adopting Good Environmental Practices ................... 34

2.5.1. Local Status ....................................................................................................34 2.5.2. Comparative Study (Egypt/ International) ...............................................39 2.5.3. Conclusion .....................................................................................................44

2.6. Incentive Programs for Compliance and Certifications .............. 44


2.7. Technical Assistance and Outreach................................................ 49


2.8. Future Directions & Planning.......................................................... 56


3. Action Plan............................................................................. 61

3.1. Column Headers:............................................................................... 61

3.2. Implementation Action Plan............................................................ 62

4. Bibliography........................................................................... 65

4.1. Glossary .............................................................................................. 65

4.1.1. Environmental Management System (EMS).............................................65

Study on Environment as an Aspect of M/SME Policy Development in Egypt Table of Contents ‐ iii

4.1.2. EMS Models ...................................................................................................65 4.1.3. Micro/Small and Medium Enterprises (M/SMEs) ....................................65 4.1.4. Cleaner Production (CP ) .............................................................................67 4.1.5. Environmental Kuznets Curve (EKC)........................................................67

4.2. References........................................................................................... 68

5. Annexes .................................................................................. 71

5.1. Annex A: Outcomes of the Field Survey ....................................... 71

5.2. Annex B: Field Survey Questionnaire............................................ 72

5.3. Annex C: Canadian Incentive Programs ....................................... 77

5.4. Annex D: Technical Assistance Programs in Mexico .................. 83

5.5. Annex E: Technical Assistance Programs in Canada .................. 84

Study on Environment as an Aspect of M/SME Policy Development in Egypt Introduction - Page 4

1. Introduction

1.1. Objectives of the Assignment The role of Micro, Small and Medium Enterprises (M/SMEs) is crucial to the development and growth of any given economy. Once considered to be remnants of traditional sectors, M/SMEs, and their development, have now become the focus of initiatives aimed at creating growth and employment in developing countries. In this context, and as part of the efforts played by the Small, Medium and Micro Enterprise Policy Development Project (SMEPoL) in collaboration with the Government of Egypt (GOE) to develop, as well as to enhance the working environment in which M/SMEs operate, and create enabling policies for SMEs to grow, this report is assessing the current status of M/SMEs’ environmental practices in Egypt and what environment sensitive M/SMEs policies should be developed and/or enforced. Environment is one of the three crosscutting themes to be considered in SMEPol Project and CIDA.

1.2. Background This section presents a general background about environment and the entities concerned with environmental affairs.

1.2.1. Organizations Concerned with Environmental Affairs Environment is a cross cutting dimension for many governmental, non‐governmental and private sector organizations; it should be ultimately everybody’s concern.

The Ministry of State for Environmental Affairs (MSEA) is the main governmental authority concerned with environmental affairs. The ministry has focused, in close collaboration with national and international development partners, on defining environmental policies, setting priorities and implementing initiatives within a context of sustainable development.

According to Law 4/1994 for the Protection of the Environment, the Egyptian Environmental Affairs Agency (EEAA) was restructured with new mandate to substitute the institution initially established in 1982. On the central level, EEAA represents the executive arm of the Ministry.

The local status in Egypt demonstrates a clear direction to assign and empower one organization to be the focal point for planning, providing technical assistance and monitoring/ inspecting compliance to laws related to the environment.

The following figure illustrates different types of organizations based on their role and function to improve environment quality and preserve the environment. It is very common that one organization could have one or more functions.


Figure 1 – Organizations involved in Environmental Affairs

Economic development has placed great stress on Egyptʹs environment. Population density combined with long‐postponed infrastructure investments has severely overwhelmed water and wastewater services of urban areas creating numerous environmental hazards. Oil pollution and careless anchoring of boats have damaged coral reefs off the coast, as has pollution from urban and industrial sources and improper disposal of solid wastes. Rapid population growth is straining natural resources as agricultural land is being lost to urbanization, desertification and salination. The Nile and its tributaries are being contaminated with pollutants, chemicals, and heavy metals.

Although Egypt does not have an extensive history of environmental law, regulatory policy has gained momentum over the past few years. In 1994, Egypt passed Law 4 for the preservation of the environment. This law restructured the existing environmental ministry and created the Egyptian Environmental Affairs Agency (EEAA) to draft laws, create and enforce regulatory standards, establish near‐ and long‐term plans for environmental management, coordinate local, regional and national environmental protection efforts, and regularly report on the state of Egyptʹs environment.

Education, Awareness

and Research

Bodies (Gov., Private, NGOs & Int’l)

Technical assistance bodies

(Gov., Private Sector &/NGOs, Intl.

entities)

Regulatory bodies (Governmental)

Enforcement bodies (Governmental)

Funding agencies

(Intl. & Gov.)


Organizations map in Egypt could be summarized as follows:

Organization

MSE

A1 /E

EAA

2

MoT

I3 /IM

C4

MWRI

5

MoH

P6

MoE

E7

MoI

8

NGOs

Drafting and Presenting Regulations

Providing Technical Assistance (Consultation and Implementation)

Partnering in funding environmental programs

Managing Funds for environmental activities

Enforcement, inspection and follow‐up

Design and Conduct Awareness Campaigns

Develop and Conduct Research Studies

Suggesting Educational Programs

Table 1 – Organizations involved and their roles

Funding bodies could be listed as follows:

1. Canadian International Development Agency (CIDA) 2. Danish International Development Agency (DANIDA) 3. Egyptian Environmental Protection Fund (EEPF) 4. European Investment Bank (EIB) 5. European Union (EU) 6. German Technical Cooperation (GTZ) in Egypt 7. Italian Cooperation in Egypt 8. Japan Bank for International Cooperation (JBIC) 9. KFW Development Bank

1 Ministry of State for Environmental Affairs 2 Egyptian Environmental Affairs Agency 3 Ministry of Trade and Industry 4 Industrial Modernisation Centre 5 Ministry of Water Resources and Irrigation 6 Ministry of Health and Population 7 Ministry of Electricity and Energy 8 Ministry of Interior


Air

Land

Water

Wildlife

Figure 2 –Environment Elements

10. Social Fund for development (SFD) 11. United Nations Economic and Social Commission for Western Asia (ESCWA) 12. United Nations Environment Program (UNEP) 13. United Nations Industrial Development Organization (UNIDO) 14. United States Agency for International Development (USAID) 15. World Bank

1.2.2. Environmental Elements A comprehensive look to the environment could consider three domains; first domain covers the working environment inside a facility, second domain is the facility surrounding environment that covers a circle of 1 km or more in diameter and third domain is the general environment that extends outside a facility’s domain or outside a country’s boarders regionally and internationally.

The first domain is mainly concerned with health and safety, the second is concerned with practices impacting environment and the third is mainly about complying with international agreements, standards and measurements.

The environmental elements impacted by M/SME operations are mostly air, water and land. This impact mainly occurs because of the different types of waste produced by M/SMEs. This waste is not treated properly to comply with international standards and to avoid the high pollution ratios measured and detected in both urban and industrial areas. The types of waste commonly generated are gaseous waste, liquid waste dispensed in regular sanitary system or water sources and solid wastes. The wildlife in Egypt is well protected by the law and limited to areas not really impacted by M/SME operations.

1.2.2.1. Air Pollution

The greater Cairo area, home to 15 million people, has the highest air pollution in Egypt. Fumes from Cairoʹs 1.2 million vehicles, combined with suspended particulate matter (including lead) plus sand blown into urban areas from the neighboring Western Desert, create an almost permanent haze over the city. Cairo also has high levels of sulfur dioxide and nitrogen oxide9.

Air quality in Cairo and throughout Egypt is measured by an ever‐growing network of monitoring stations (42 stations in 2001) installed with the support of USAID. Air pollution in Egypt comes from a number of sources, including industrial sites, vehicular emissions, and smoke from burned garbage and agricultural detritus.

1.2.2.2. Water Resources Pollution

Water resources in Egypt could be limited to the following resources:

9 Egypt Country Profile on Environment, issued by EEAA


• Nile River Water,

• Rainfall and flash floods,

• Groundwater in the deserts and Sinai and

• Possible desalination of sea water

Each resource has its limitation on use, whether these limitations are related to quantity, quality, space, time, or use cost.

A water quality impact assessment was carried out in 1990/1991 by a group of Egyptian and international experts10. The water quality of the Aswan High Dam Reservoir was deemed good. The quality of the river below Aswan has reflected the uniform quality of stored water both seasonally and from year to year since the construction of the Aswan High Dam. The inputs of sewage along the river reduce the oxygen content especially in the vicinity of big cities.

In industrial waste discharges, particularly, these of sugar mills and sewage of major cities, the high organic contamination causes reduction in dissolved oxygen in the immediate downstream. Some heavy metals were also predicted, implying chromium near Assiut in Upper Egypt. Bacterial contamination as faecal and total coliform bacteria concentration was found high around Kafr‐El‐Zayat in Lower (North) Egypt. Navigation activities on the Nile are diverse; commercial and public transportation. River fleet, some 9000 units, contributes to pollution by oil and grease.

1.2.2.3. Soil Pollution

Land degradation cannot be judged independently of its spatial, temporal, economic, environmental and cultural context. Evaluations are therefore almost infinitely variable and very dynamic.

1.3. Scope of the Assignment 1.3.1. Sectors impacting the environment The major sectors impacting the environment are illustrated in the following figure. M/SME represent a majority of businesses causing pollution from these sectors. The current study focuses only on industrial sector and setting ranking for the selected sub‐sectors based on their distribution and impact as it is described in the following paragraphs.

10 Welsh and Mancy, 1992


Figure 3 – Sectors impacting the environment

1.3.2. Industrial Sector Classification Industrialization is considered the cornerstone of the development strategies due to its significant contribution to the economic growth and hence human welfare. Nevertheless, in most developing countries it led to serious environmental degradation. The earnest intentions are now not only targeting the qualitative and quantitative treatment of the industrial wastes but also attempting to avert their hazards to human health and restoring the quality of the environment.

By the beginning of 1950s, heavy industries were born in Egypt along the Nile Delta and in Cairo and Alexandria metropolitan areas. Chemicals, food, metal products, and textiles are the most prominent subsectors in Egypt, since they are formed mostly of M/SMEs and the nature of the industry itself produces the highest percentage of contaminating wastes.

Undoubtedly, the impact of industrial pollution in Egypt appears in all environmental media: air, water, and land. Industrial releases to surface or groundwater are considered the major chemical threat to the agricultural land. The worst industrial waste liquids are those heavily laden with organic or heavy metals or with corrosive, toxic or microbial loaded substances. Such waters endanger public health through the direct use as well as through feeding with fish that live in the polluted streams.

In Egypt, food industry uses the largest volumes of water. Several studies revealed that untreated industrial wastes of more than 350 factories were discharged directly into the Nile and the Mediterranean, most of them released explicitly known toxic and hazardous chemicals such as detergents, heavy metals and pesticides11.

Some spectacular threats to water resources and land are now quite obvious, e.g., in Helwan (south of Cairo): air pollution with cement dust, nitrogen and sulfur oxides, carbon monoxide, and other airborne pollutants resulted in the death of almost all

11 RNPD, 1989


the trees (Hindy et al., 1990). The industrial wastewater discharged from Helwan area amounts to some 45 million m3/yr12.

In Shoubra El Khaima (north of Cairo) huge volumes of untreated industrial wastewater are daily discharged into agricultural drains. The textile industries representing 48.3% of the total number of industrial plants are the main contributors (almost 52%) to organic load.

The metropolitan area of Alexandria accommodates a multitude of industries in the vicinity of surface waters, e.g., in Amiria at the Lake Mariout, near the Mahmoudia Canal, etc. Out of 1243 industrial plants, 57 were identified as major sources of marine pollution either directly or indirectly via Lake Mariuot. Paper, textile and food industries contribute 79% of the total organic load.

As it might be expected, the mid‐stream conditions of the Nile are still, on an average, at a fairly clean level owing to dilution and degradation of the pollutants discharged. The riverbanks, however, are much more polluted.

Inefficient production in some chemical industries (e.g., oil and detergents) generates waste that contains raw material as well as products, a costly burden to the national economy and the consumer13.

Evidently, efficient production causes lesser pollution. Cleaner production is defined by UNEPʹs Industry and Environment Program Activity Center as “the continuous application of an integrated preventive environmental strategy to processes and products to reduce risks to humans and the environment” (Weston Inc. and Lambert, 1990). Obviously, cleaner production is the unique answer for the industrial pollution in Egypt.

The Industrial Modernization Center (IMC) as a major technical assistance body is equipped with sufficient funds to help M/SME’s to be compliant and competitive. IMC provided services in many areas related to environment, health and safety. The following table focuses only on ISO 14001 certification efforts and showing the statistics for different Industrial sectors and the geographical coverage.

12 Previous Reference 13 Abou-Elela and Zaher, 1998


Statistics of Companies Served on preparation for Quality Certifications Related to Environment

Chemicals

Agro Industries

Building Materials

Engineering Food Furniture Leather Packaging

& Printing Pharma Textile IT Other Services Total

ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001 ISO14001

Cairo / Qualyobia 3 2 8 3 2 2 2 10 3 3 38

6th of Oct. /Giza 7 6 6 1 20

Sadat 2 1 3

Sharkia / 10th of Ramadan 2 2 3 2 1 10

Suez 1 1 2

Delta 3 1 2 6

Alex/ Behaira 1 2 1 1 4 1 10

Borg El-Arab 9 1 6 2 2 20

Dakahlia 1 1 1 3

Damietta 1 2 3

PortSaid 1 2 8 11

Assuit 1 1 2

El Minia 1 1 1 3

Beni Sweif 1 1 1 3

Souhag 1 1

Total 29 2 7 21 17 3 0 10 7 21 4 14 135

Sector/ Governorate

Table 2 – Companies Assisted by IMC in preparing for/obtaining ISO 14001 Certificate

1.3.3. Technical Assistance Programs There are several funded programs for improving the M/SME’s environmental practices addressing different stages of the industrial process as illustrated in the following figure

Figure 4 – Environmental Practices and the Industrial Processes


The current programs cover two phases, Clean Production phase and Waste management phase.

From policy making point of view, environment handling should cover the following dimensions as addressed in the International Standards Organization for standardization (ISO 14000)

• Environmental management systems

• Environmental auditing

• Environmental performance evaluation

• Environmental labeling

• Life‐cycle assessment

ISO 1400x is well on the way to achieving as much, if not more, in enabling organizations to meet their environmental challenges.

The ISO 1400x family is primarily concerned with ʺenvironmental management14ʺ. This means what the organization does to:

• Minimize harmful effects on the environment caused by its activities (implementation of good practices), and

• To achieve continual improvement of its environmental performance (continuous improvement of the processes).

14 For a definition of Environmental Management Systems, refer to the Glossary on page 65


1.4. Overview of Projects Targeting M/SMEs The major projects impacting the environmental practices for M/SMEs could be summarized as follows:

Item SEAM I & II EPAP I & II/ CF ACI CPC ISO 14000 assistance

Description Support for Environmental Assessment and Management

Egyptian Pollution Abatement Project and Carbon Fund

Achieving Compliance with environmental regulation in Industry

Clean Production Center

To evaluate the level of compliance to the international standards for environmental management

Sector of focus Dairy sector General industry and trade sector

Engineering, Textile, Chemical & Food

All Industrial Sector

All Industrial Sectors

Beneficiary size MSME SME’s & large SMEʹs All sizes All sizes Implementer EEAA EEAA FEI Ministry of Trade

and Industry IMC

Donor UK Department for International Development

‐ World Bank ‐ EIB ‐ Finnish Gov

DANIDA UNIDO EU

Period 1994‐1999 (I) 2000‐2004 (II)

1997‐ 2004 (I) 2006‐ 2012 (II)

2001‐2007 On going On going

Financial SEAM II: €4.238 million

EPAP: US$ 48.7 Mils EPAP II: US$ 165.97 Mils

L.E. 22 million Information Not Available

Information Not Available

Table 3 – Environmental Projects Overview


1.5. Our Methodology Megacom has its research methodology and data validation rules. This methodology has been proven effective through a number of research studies, especially those focusing on policy reforms. The following figure illustrates the said methodology.

Figure 5 – Megacom Research Methodology

Available local and international studies targeting M/SMEs practices that are related to environment were collected, studied and analyzed.

Local Status was analyzed through reviewing environmental enacted laws and conducting a field survey. The field survey was designed and reviewed with SMEPoL. It targeted different issues related to environmental standards and the related M/SMEs practices in mainly three industries which are: Food, Chemical and textile industries with special attention to gender proprietary.

The surveyed represents micro, small and medium enterprises working mainly in three sectors, namely Textile, Food and Chemical industries. M/SMEs represent the


majority of businesses in the selected three sectors, as well; these sectors are among the industries that have a considerable impact on the environment due to the production procedures and the type of waste they produce.

The main areas that the survey covered were the: awareness, current status of compliance with environmental requirements and readiness to adopt better environmental practices. Annex A includes the outcome of the said survey.

On a parallel path, the international experience was studied to identify success stories and lessons learned from countries that already went through the process of encouraging and supporting M/SMEs in adopting practices that are more environment‐friendly.

Based on the outcomes of both areas (local and international) an international comparative study was developed. The comparative study and summary tables in addition to the Experts’ input led to recommendations on how to improve the M/SMEs practices in terms of environment protection.

The recommendations are narrated with a summary table at the end of each category as illustrated in the following table.

No.

Scope

Level

Recommendation Affected Law

1 2 1 Assign a single authority to be responsible for regulations with “Vito” rights

4/1994

Table 4 – Example of Recommendations Table

The legends used in the recommendation tables are explained as per the following table:

Column Legend Description

0 The reform is to be implemented within the scope of a certain Authority/Department

1 The reform is to be implemented Cross‐Authorities within the same Ministry

Scope

2 The reform is to be implemented Across‐Ministries 0 The recommendation is targeting the Reforms Methodology; 1 The recommendation targets a change in a Law or a law

provision 2 The recommendation targets a change in an activity stipulated

by Regulations 3 The recommendation targets a change on the Procedure level

Level

4 The recommendation targets a change in the Habits of personnel.


In the next phase, the action plan will be developed in a tabulated form with clear tasks, task owner, actor agencies, timeframe and impact measures.

1.6. The Project Team Mona El‐Gammal – Team Leader

Mona El‐Gammal enjoys more than 23 years of practical experience in the field of business development and Strategic planning, mainly with large multinational companies and more than 5 years in providing consultation services. She gained a wide experience in Strategic Planning & Implementation, and Business Development during her long career.

Ibrahim Roushdy – Environmental Expert

Dr. Ibrahim Roushdy is a qualified Environmental Management Systems lead auditor, in addition to that, he is also a QMS and HACCP lead auditor with a long theoretical and practical experience in preparing different organizations to implement EMS and in auditing those companies applying for EMS certification.

Mohamed Abdel‐Raouf – Legal Expert

With an educational background in Private Law, Mr. Ali has a Ph.D. degree in International Commercial Arbitration from the University of Montpellier, France. Specializing in Arbitration and Alternative Dispute Resolution (ADR), Dr. Ali is also interested in Commercial Law, Investment Agreements, International Business Law, Construction Contracts and State Contracts (concluded between States, or State owned companies, and multinationals). Fluent in English, French and Arabic, he is pursuing a career in law as a Lawyer, Legal Consultant and Commercial Arbitrator.

Heba Naiem –Researcher

Mrs. Naiem gained a profound experience in conducting desk research and field surveys through her active participation in several search studies on both the macro and the micro level in Egypt.

She is well familiar with research and interview techniques, internet utilization and desk research methodology.

She also has a good experience in logistics management, taking meeting minutes and following up meetings outcomes.

Study on Environment as an Aspect of M/SME Policy Development in Egypt International Experience - Page 17

2. International Experience Most of the existing studies had no or minimum information on international experience. Accordingly, this study tended to provide comprehensive comparative study between Egypt and a number of countries that were carefully selected and identified.

To develop the international comparative study, four countries were identified to be scanned. These counties are:

• Canada: As a developed country achieving a high rank in the area of Environmental Compliance it is worth understanding its experience.

• UK: As a developed country achieving a high rank in the area of Environmental Compliance with a different geographical location, thus it is worth understanding its experience.

• Mexico: As a developing country exerting efforts in the area of Environmental Compliance.

• Morocco: As a developing Arab country sharing similar climate and natural characteristics with Egypt and exerting efforts to improve Environmental compliance.

A great amount of data was collected about Environmental affairs in these countries from different resources. To conduct this study, the researchers visited official governmental websites, studied independent studies, in addition to interviews conducted with governmental officials and representatives of funded programs.

To better utilize the data of the international experience, it was classified into features. These features characterize the model adopted in the scanned countries in the area of environment. Egypt then is compared to the four counties as per these features.

For example, some of the features characterizing the degree of the civil society involvement in the area of environment were:

• Level of civil society involvement in environmental issues.

• The government recognized Public participation as a tool for enhancing compliance.

Different features/ characteristics were grouped under main categories to provide a structured scanning approach. These categories are:

• Organizations concerned about Environmental affairs,

• Law Coverage,

• Compliance and Enforcement,

• Ranking and indexes related to clean environment,


• Drivers and Barriers for good environmental practices,

• Incentive Programs for compliance and certifications,

• Technical Assistance and Outreach (Awareness, Training, Consultations and assistance to implementation)

• Future Directions and Plans.

This study uses tables as a means to compare certain characteristics in scanned countries in stead of narrated text as in traditional studies.

2.1. Organizations Concerned with Environmental Affairs 2.1.1. Local Status At the beginning of the 1990s, Egypt has initiated two environmental initiatives on the national level, namely the “Environmental Law (Law 4/1994)” and the “National Environment Action Plan (NEAP)”, which is considered as Egypt’s environmental agenda for the next 15 years.

While the “National Environmental Action Plan (NEAP)” presents a strategic framework for environmental initiatives and activities, there are no detailed plans for executing its components.

The Egyptian Environmental Affairs Agency (EEAA) is the main governmental organization responsible for environmental affairs in Egypt; it is the executive arm of the Ministry of State for Environmental Affairs (MSEA). In the meantime, there are several governmental organizations involved in environmental affairs. Other ministries like the Ministry of Irrigation and Water Resources, Ministry of Agriculture, Ministry of Health and Population, Ministry of Electricity and Energy and Ministry of Interior are playing different roles in the field of environmental regulation and enforcement.

What has been concluded throughout the study is that level of harmonization and coordination among all these entities prove to be low and fragile.

Speaking about the civil society role in the area of environment, it could be stated that a great number of Egyptian NGOs are active in this field. However, there is no coordination among such entities nor do they have real involvement in the national environmental strategies and polices.

There is a federation for all NGO’s working in environment protection15. This federation has more than 800 NGO members covering most of the Governorates in Egypt and representing the best outreach to the smallest villages in Egypt. The federation took initiatives to join forces with the Federation for Economic Development Associations16 which focuses mainly on M/SMEs’ development and

15 Confederation of Associations involved in Environment Protection, http://www.eengof.com 16 http://www.fedamisr.net


support. The joined federations participated actively in reviewing and discussing the amendments of the environmental law.

Furthermore, voluntary initiatives to encourage best practices in the environmental field in Egypt are limited, the Corporate Social Responsibility (CSR) initiative could be utilized as the vehicle to improve the environmental awareness and assist M/SMEs to improve their environmental practices.

2.1.2. Comparative Study (Egypt/ International)

Feature

Egypt

Canada

UK

Mexico

Morocco

The main governmental entity concerned with Environmental affairs

Egyptian Environmental Affairs Agency

(EEAA)

Environment Canada

The Environment

Agency

Secretariat of Environment,

Natural Resources and

Fishing (SEMARNAP)

Ministry of Territory Planning, Water and

Environment

Other governmental authorities involved in Environmental issues

Level of coordination among different entities concerned with Environmental affairs

Low High High High Medium

Entity responsible for drafting environmental regulation

Multiple Ministries

Environment Canada

Environmental Policy Division

(EPD),

(SEMARNAP) Ministry of Territory Planning, Water and

Environment Level of community involvement in environmental issues: (High, Medium, low)

low High High Medium low

Public participation is a tool for enhancing compliance


Voluntary initiatives to encourage best practices in the environmental field

Table 5 – Organizations Comparative Study

Environment Canada is the main governmental entity concerned with environmental affairs.

The same almost applies to the United Kingdom where the Environment Agency is the key governmental environment organization.

In Mexico, the Secretariat of Environment, Natural Resources and Fishing (SEMARNAP) is the main governmental authority responsible for environmental affairs.

The “Ministry of Territory Planning, Water and Environment” is the main governmental entity responsible for environmental affairs in Morocco.

In Canada, there is another governmental body working in this area, which is the Canadian Wildlife Federation. As for the UK, the role of non‐governmental organizations is more apparent in terms of environmental protection. Among these NGOs there are the Friends of the Earth and the Association for Environmentally Conscious Building.

The case is different in Mexico, where other governmental agencies are involved in environmental issues. These entities are: the National Institute of Ecology, the National Water Commission, the Mexican Institute of Water Technology, the Federal Agency for the Protection of the Environment, and the National Institute of the Fishery.

In Morocco, several governmental entities are involved in environmental affairs along with the main governmental authority. Nevertheless, in 1995, the Moroccan government reorganized its environmental protection and regulatory agencies, which had previously been dispersed, into one central entity ‐ the Ministry of Regional Development, Urbanism, Habitat, and the Environment. Within the Ministry, the Department of Environment is responsible for the coordination of environmental activities and for implementation of the national environmental strategy, including drafting of Morocco’s environmental laws and regulations. Among the Department’s priorities is establishing a regulatory framework for the protection of Morocco’s environment.

Both Canada and UK successfully achieved a high level of harmonization and coordination among different entities concerned with Environmental affairs. More specifically, Canada has cited a good example for harmonization while trying to harmonize environmental standards throughout the country; the various levels of


government have established the Canadian Council of Ministers of the Environment (CCME). CCME is gradually establishing agreed‐upon national standards to be implemented by the appropriate jurisdiction in the different municipalities or provinces.

As well, Mexico has also managed to achieve a high level of harmonization. In 1997, the President of Mexico initiated a new policy for the environmental regulation of industry, based on the 1996 reform to the Ecology Law, and the national Environment Program, 1995‐2000. Accordingly, the SEMARNAP has been entitled to achieve a more integrated approach to licensing by building regulatory partnerships between the agencies responsible for different aspects of environmental management.

This incorporates in a single process the regulatory requirements regarding environmental impact and risk, atmospheric emissions, use of national waters, waste‐water discharges and the management of hazardous waste. Pilot projects are also being undertaken to test mechanisms for coordinating environmental licensing requirements between federal, state and municipal levels of government.

Canada is one of the best countries showing high involvement of civil society in the environmental affairs. Similarly, non‐governmental organizations are involved in the United Kingdom, indicating almost the same high level of civil society in environmental issues.

Mexico and Morocco, on the other hand, have a high number of active environmental NGOs. Nevertheless, at the national level these groups are not very effective nor can they participate in national environmental policy.

Both Canada and UK have recognized importance of public participation in the enhancing compliance to environmental standards and regulations.

Based on 2005‐2007 Plan of Action Pursuant to the U.S.‐Morocco Joint Statement on Environmental Cooperation, Morocco set promoting opportunities for public participation in environmental protection efforts and improving public access to information and access to justice on environmental issues as a priority for improving the country ability to protect the environment.

It was found that both Canada and Mexico have voluntary initiatives to encourage best practices in the environmental field. In both cases, the traditional environmental regulatory actions are being carried out in conjunction with voluntary programs designed to provide incentives for greater environmental performance. Each country has programs designed to encourage the use of environmental management systems.

Similarly, a key study about UK SMEs and their response to environmental issues17 highlighted that due to the construction industry’s high public profile there have 17"UK SMEs and their Response to Environmental issues" by Andrea Revell and Robert Blackburn, March 2004, Small Business Research Centre, Kingston University


been numerous government and industry‐led voluntary initiatives to encourage best practices, for instance “Rethinking Construction”’, “Partners in Innovation” and the “Construction Best Practice Programme”, all with sustainability and environmental compliance as part of their remit. Such schemes were felt to have raised awareness of the importance of sustainable construction and environmental protection.

However, this was not the case in Morocco where there is not much voluntary initiatives to encourage best practices in the environmental field.

2.1.3. Recommendations The term “Ownership” refers to the responsibility for planning, regulating and enforcement of environmental requirements. In Egypt, this responsibility is scattered among a number of authorities under different ministries. This subsection discusses our recommendations to enhance the ownership of environmental affairs.

2.1.3.1. Assign a single authority to be responsible for regulations with “Vito” rights

Currently, there are several authorities that assume the role of regulator and controller for environmental affairs. While the Egyptian Environmental Affairs Agency (EEAA) is the key governmental organization responsible for environmental affairs in Egypt, other ministries are involved in regulation and inspection, e.g. Ministry of Irrigation and Water Resources, Ministry of Agriculture, Ministry of Health and population and Ministry of Electricity and Energy.

The environment law (4/1994) states that EEAA is to be responsible for drafting necessary laws and regulations and for providing advice on other laws and regulations that may have an impact on the environment18.

Thus, we recommend that the EEAA be assigned as the sole entity responsible for drafting environmental regulations, and that its role be extended to have “Vito” rights on other regulations that may have an undesired impact on the environment.

2.1.3.2. Translate the National Environment Action Plan into published detailed plans

As mentioned earlier, while the “National Environmental Action Plan (NEAP)” presents a strategic framework for environmental initiatives, there are no detailed plans for executing its components. There is a need for developing these plans in a form that clearly describes the tasks to be achieved, their timeframe and the progress that is made.

Since EEAA is the key authority responsible for environmental affairs, and since law 4/1994 states that EEAA is authorized to “formulate the national plan with the

18 Law 4/1994, Article 5


projects included for the protection of the environment19”, we recommend that EEAA would develop annual detailed action plans to achieve the components of NEAP.

The said plans should be available to public. EEAA has a very well‐organized and detailed website20 that presents different types of information in a simple and clear form. We recommend that the detailed action plans and their updates would be published through the website.

2.1.3.3. Assign the role of environmental inspection to a single authority

Studying the local status, as well as the field survey conducted during the study, revealed the fact that there are different authorities that assume the role inspection for compliance with environmental requirements.

These authorities include Ministry of Health and Population, Ministry of Irrigation and Water Resources, Ministry of Agriculture, Ministry of Electricity and Energy and Ministry of Interior. Each one of the mentioned ministries conducts its own inspections for the areas that are of higher importance to them.

Conducting inspection by entities other than EEAA overlaps with the statutory role of EEAA. This creates confusion for M/SMEs as each entity conducts its inspection based on its own procedures. Moreover, there are no means for sharing the results of inspection between different authorities, and thus the procedure is redundant.

We recommend that a single authority would assume the role of environmental inspection. According to the provisions of the environmental law, EEAA is the entity to “Conduct field follow‐up of compliance with the criteria and conditions that are binding to agencies and establishments and take the procedures prescribed by law against those who violate such criteria and conditions.21”

It is worth mentioning that EEAA’s website includes a dedicated section for the inspection procedures and standard forms used. This information is clear and available to public.

2.1.3.4. Ensure that the enterprise receives a copy of the inspection report

For the sake of transparency, the inspected enterprise should receive a copy of the inspection report at the end of the inspection session.

This would provide the necessary credibility for the inspection process itself and provide the means to follow‐up on the progress achieved in satisfying different comments stated in the inspection report.

19 Previous source 20 http://www.eeaa.gov.eg/default.htm 21 Law 4/1994, Article 5


2.1.4. Recommendations Summary The following table summarizes the recommendations listed in this subsection as well as their scope, level and laws affected.

No.

Scope

Level


1 2 1 Assign a single authority to be responsible for regulations with “Vito” rights

4/1994

2 0 3 Translate the National Environment Action Plan into published detailed plans

None

3 2 1 Assign the role of environmental inspection to a single authority

4/1994

4 0 1,3 Ensure that the enterprise receives a copy of the inspection report

Ministerial Decree

Table 6 – Recommendations on Ownership

2.2. Law Coverage 2.2.1. Local Status The twentieth century has witnessed increasing concerns and efforts to preserve environment and raise environmental awareness. Meanwhile, the Egyptian legislator has issued several legislations reflecting a concern of preserving environment and its resources. This has started since the Egyptian legislator acted the penal code issued by law no. 58 of 1937 and followed by a huge number of environmental legislations forming a legal arsenal of numerous texts with unequal legal weight: laws, decrees, as well as internal administrative circulars that contain legal stipulations of an environmental nature

However, in 1994, the legislator intended to set an integrated legal framework for environment, and accordingly enacted the law no. 4 of 1994.

The Egyptian Environment Protection Law 4/1994 covers waste management inspection and penalties in addition to import of toxic substances. It is worth mentioning that the law does not address resources management, rather it covers sanctions for polluting or damaging natural resources.



Feature

Egypt

Canada

UK

Mexico

Morocco

Unified Law/Decree for environmental protection Does the law address resources management Does the law address waste management Does the law outline inspection and penalties Does the environment law cover import & export of toxic and harmful substances

Table 7 – Law Coverage Comparative Study

Most the scanned countries possess a unified law for environment, or at least show that they are in the process of consolidating environmental legislations into one comprehensive act.

For example, the Canadian environmental regulatory framework was complicated by the overlapping jurisdiction of three levels of government – federal, provincial and municipal. However, all levels of government are now attempting to develop a more harmonized legislation. The various levels of government have established the Canadian Council of Ministers of the Environment (CCME) and the CCME is gradually establishing agreed‐upon national standards for implementation by the appropriate jurisdiction. Moreover, Canadian environmental issues are now governed by the Canadian Environmental Protection Act, 1999 (CEPA), a generally applicable federal environmental legislation.

Also in Mexico, there is a unified federal law or the so called “General Law on Ecological Equilibrium and Environmental Protection”.

In recent years, the UK replaced and modified previous environmental legislations and consolidated many older laws into large, wide ranging Acts: The Environmental Protection Act 1990 and the Environment Act 1995 law.

Similarly, in 2003, environmental legislation in Morocco witnessed a leap forward with the parliament adoption of three law proposals that were entirely dedicated to environment: the general framework law on environmental protection; a law requiring environmental impact assessments; and an air pollution prevention law.


2.3. Compliance and Enforcement 2.3.1. Local Status Reviewing the enforcement status of environmental laws in Egypt, it became clear that Egypt does not have a comprehensive declared policy for compliance and enforcement, nor does it have a specific entity for environmental law enforcement and compliance. Moreover, the Egyptian law (4/1994) and its executive regulations state that non‐compliance situations will be subject to fine. However, the legislator did not clearly define the fines specified for each case of violation of the law provisions.

Currently, proposed amendments to the environmental law are being studied, as these amendments provide a clear definition of the penalties to be applied in cases of non‐compliance.

Although the Egyptian Environmental Affairs Agency is responsible for environmental inspection, other entities take part in the process of inspection and penalties, the fact that undermines the practical role of the EEAA in enforcing the environmental law.

Conducting interviews with stakeholders including governmental officials, NGOs representatives, SMEs entrepreneurs prove a lack of good awareness of the environmental legislations and good environmental practices in general.

Furthermore, Egypt does not possess a clear methodology for handling non‐compliance. Accordingly, it is clear that there is a gap between environmental legislation and the institutional conditions for implementation.


Feature

Egypt

Canada

UK

Mexico

Morocco

Date of the environment law 1994 1999 1990‐1995

1988

2003

Date of last amendment of the environment law 2005 1999 1995 1996 2003Existence of a declared policy for compliance and enforcement

Existence of entity/ies responsible for enforcement of environment law

Degree of awareness of environmental legislations (High, Medium, low)

L H M L L

Is there a specific entity for inspection A specific entity for non compliance handling A standard model for inspection


Feature

Egypt

Canada

UK

Mexico

Morocco

A mechanism to collect data for consolidation, analysis and building recommendations for amendments

A gap exists between environmental legislation formulation and administrative and/or social conditions for implementation

Table 8 – Compliance and Enforcement Comparative Study

Among the four scanned countries, Canada presents an outstanding model for the enforcement of environmental laws and regulations.

In addition to being a legislative tool for controlling and managing environmental issues, the Canadian Environmental Protection Act (CEPA), enacted in 1999, also provides a platform for a stronger and more effective enforcement role for Environment Canada.

Concurrent with the promulgation of CEPA, a second document was also released entailing a comprehensive policy for compliance and enforcement. That document, the ʺCompliance and Enforcement Policyʺ, laid the groundwork for the establishment of specialized inspector and investigator units in each of the regions of Canada. Most provinces now have, or are in the process of developing, analogous policies.

The Canadian Compliance and Enforcement Policy provide five guiding principles. These are:

• Compliance with the Act and its regulations is mandatory.

• Enforcement officers throughout Canada will apply the Act in a manner that is fair, predictable and consistent. They will use rules, sanctions and processes securely founded in law.

• Enforcement officers will administer the Act with an emphasis on prevention of damage to the environment.

• Enforcement officers will examine every suspected violation of which they have knowledge, and will take action consistent with this Compliance and Enforcement Policy.

• Enforcement officers will encourage the reporting to them of suspected violations of the Act.

This Canadian Compliance and Enforcement Policy placed environmental non‐compliance into perspective and compelled an appropriate response from departmental enforcement officials. In order to meet these obligations, an Office of


Enforcement was established in the National Capital Region which spawned the creation of Investigations Divisions in the Regions.

The Compliance and Enforcement Policies place an obligation on enforcement officers to respond to all non‐compliance of which they become aware. Departmental managers quickly realized that, in light of continued governmental restraint, it was not only unreasonable but a physical impossibility to meet this obligation. Consequently a system was devised whereby the various known cases of environmental non‐compliance can be ranked according to a number of environmental and enforcement‐related criteria. This allows a rational determination of the priority which should be placed by managers on enforcement activities related to specific industries or sectors and provides a tool for assigning resources.

Inspectors designated under CEPA have broad power to enter, search and seize when the inspection is being conducted for the purposes of verifying compliance. There is a very important distinction to be made here between the intent of an inspector, and that of an investigator. The Canadian Charter of Rights and Freedoms guarantees Canadians the right to be free from unreasonable search and seizure where any evidence gathered as a result of that search is being gathered for the purpose of proving a crime. On the other hand, businesses operating in Canada do so on the understanding that inspectors, whose job it is to check to see that the company is functioning in a manner which complies with the law, will have access to any property, provided that those authorities to do so are written in law.

The powers of an inspector under section 218 of CEPA include the power to:

• examine any substance... or any other thing relevant to the administration of the Act that is found in the place;

• Open and examine any receptacle or package found that the Enforcement Officer believes on reasonable grounds contains any substance...;

• examine any books, records, electronic data or other documents that the Enforcement Officer believes on reasonable grounds contain any information relevant to the administration of the Act and make copies of them or take extracts from them;

• take samples of anything relevant to the administration of the Act;

• Conduct any tests or take any measurements.

In addition, the owner, operator, or any person found in a place being lawfully inspected is obliged to provide any information the inspector reasonably requires, and provide any assistance to enable the inspector to carry out duties and functions under the Act.

The authorities of investigators on the other hand are much more limited. Investigators become involved in an issue when information becomes available that gives the investigator reasonable grounds to believe that a violation has occurred.


These grounds may come from inspection reports, information voluntarily provided by the industry itself, referrals from other departments, informer tips, public complaints or intelligence analysis. An investigator in the process of gathering evidence to substantiate a violation has no power of entry, search or seizure unless a search warrant has been obtained. Any statement given to an investigator by a person, who may be charged with the offence, will not be admissible in court unless the investigator has informed that person of their rights to silence and to legal counsel. The rules applying to conduct of environmental investigators are the same as those governing regular police officers.

In view of that, the Canadian government managed to make giant strides in improving environmental compliance and maximizing enforcement of environmental laws and regulations. In this area, Canada has proved success in the following:

• The general public has made great strides in recognizing their role and accepting responsibility for protection of their own environment. Citizens can make sacrifices for the benefit of the environment.

• The public adopts the notion that the health of wildlife and the environment itself has intrinsic value and;

• The public realize that environmental crime is not victimless crimes

In the United Kingdom, SMEs consider legislation as the only thing really driving environmental reform22. However, the study has highlighted a major problem that is the lack of adequate enforcement, whereby legislations in many circumstances are likely to increase levels of non‐compliance and push more small firms into the shadow economy.

Nevertheless, the UK still possesses a variety of means for the enforcement of environmental law and has recently developed effective approaches to enforcement of environmental compliance laws. For instance, it has introduced the ʺIntegrated Pollution Controlʺ which sets standards for products and processes rather than for discharges or emissions.

Moreover, the UK Environment Agency developed Compliance Assessment Plans (CAPs) and a Compliance Classification Scheme (CCS) to ensure that compliance against all requirements of permits and other regulatory instruments are checked within a defined period. The Compliance Classification Scheme assesses the performance of a site against the conditions set in Agency issued permits.

The Compliance Classification Scheme is used to classify non‐compliance with permit conditions according to potential impact on the environment and provides information to support consistent and proportionate responses to non‐compliances. This also allows national profiling of sectors and companies. The Compliance 22 "UK SMEs and their Response to Environmental issues"


Classification Scheme are ranked from 1 (the highest potential risk arising from a non‐compliance) to category 4 (where no immediate risk of harm to the environment is likely). These categories are then used to inform The Environment Agency enforcement activities, and are linked clearly to The Environment Agency Enforcement and Prosecution Policy.

Reviewing the status of enforcement of environmental laws in Mexico and Morocco, the two countries prove they do not possess a comprehensive declared policy for compliance and enforcement. Accordingly, neither of the two countries has an entity responsible for enforcement of environmental law. Both show a low level of environmental legislations awareness. Neither of them has a clear methodology for handling non‐compliance and both countries proved they have a gap between environmental legislations and social conditions for implementation.

2.3.3. Recommendations The Egyptian environmental law (4/1994) is quite comprehensive and is covering the full spectrum of environmental affairs; however, it includes only a framework for handling non‐compliance situation. It is worth mentioning that in spite of the comprehensiveness of the law, it is not fully activated and enforced.

The main issue here is not the comprehensiveness of the law or of its regulations; rather it is the lack of enforcing the law itself and imposing the environmental requirements on different M/SMEs.

According to different stakeholders interviewed during the field survey, the law is not active, and enforcement is not rigid.

Such inactivity could be attributued to different reasons, including financial limitations of M/SMEs, lack of sufficient resources and qualifications in terms of inspectors, and lack of environmental awareness among M/SMEs.

2.3.3.1. Ensure that penalties stipulated by the new amendments to the environmental law are proportional to the magnitude of the environmental infringements

It is important that the new amendments should impose penalties proportional to the infringement, with a gradually increasing weight according to repetitive breaches. Carefully studying the new amendments would eliminate the chance of having negative impacts on the formal industrial sector.

In the meantime, the grace period stated in the said amendments (2 months) may not be enough for total compliance, therefore they should consider extend this grace period to allow time for developing and implementing an approved compliance plan.


2.3.3.2. Increase the number of qualified environmental inspectors

One of the reasons for not activating the environmental law is the lack of qualified resources. EEAA has only 8 Regional Branch Offices (RBOs) serving all the governorates of Egypt.

We recommend that EEAA extend its enforcement arm through recruitment of new members to join its activities. The new members are recommended to receive the proper training on how and what to inspect in industrial enterprises.

It is recommended that EEAA dedicate part of its financial resources for obtaining the most up‐to‐date equipment/testing labs to support the efforts of working inspectors and to provide accurate and reliable results.

It is expected that implementing this recommendation would require a considerable amount of financing. Thus, we recommend that EEAA approach different international programs targeting environmental improvements in Egypt, as well as national initiatives to cover or participate in covering this cost.

2.3.3.3. Develop and publish Enterprises Environmental Compliance Index

As an incentive for compliance with environmental requirements, we recommend that EEAA develops and updates an “Enterprise Environmental Compliance Index”. This index would rank Egyptian enterprises according to their compliance with environmental requirements.

The index would be based on the results of inspection session(s) conducted for different enterprises. Updating the rank of an enterprise would depend on the results of follow‐up and regular inspection reports.

It is worth noting that such an index would have a considerable impact on a company’s image in the local and international markets as it would serve as a marketing tool informing potential clients that this company is environmentally compliant. It is “published evidence” that would enhance the company’s position in export markets.

It is recommended that EEAA updates the index on a semi‐annual basis and publishes an annual report on the Egyptian enterprises ranking status. The ranking index should be available on the EEAA website.

2.3.3.4. Publish the inspection reports through EEAA website

As mentioned in recommendation 2.1.3.4, a copy of the results of environmental inspections should be supplied to the inspected enterprise.

In addition, it is also recommended that the results of the inspections and inspection reports be published on the EEAA website. This procedure would ensure the transparency of the inspection process.


2.3.3.5. Conduct awareness seminars directed to M/SMEs

The term awareness covers a lot more than just knowing that there is an environmental law or that a non‐complying enterprise would be fined.

“Environmental Awareness” covers different aspects of “Environment Friendly” production processes, environmental quality management systems, different environmentally‐categorized industries and the benefits of complying with environmental requirements.

EEAA is exerting noticeable efforts in spreading environmental awareness. Nevertheless, the survey conducted as part of this study showed that the majority of M/SMEs lack the proper environmental awareness.

For example, 3% of the sample had no awareness whatsoever, while only 3% had a comprehensive knowledge of environmental issues. 35% of the sample was aware of the law 4/1994, while only 3% was aware of the term “Clean Production”.

Level of Awareness

0%1%-20%21%-40%41%-60%61%-80%81%-100%

Figure 6 – Level of Awareness between surveyed M/SMEs

To leverage the level of awareness, we recommend that EEAA delivers a comprehensive program of awareness seminars directed to M/SMEs in different geographical locations.

The seminars should be utilized to familiarize participants with the different requirements that are specific to each industry. As well, the participants would be introduced to the concepts of “Clean Production”, and obtain the necessary information about different initiatives and current funded programs; their services and how to obtain them.

It is recommended that EEAA would collaborate for such campaign with Non‐Governmental Organizations that are active in the field of environment issues.


2.3.3.6. Provide Pre‐Inspection consultation

It is expected that most of the M/SMEs would lack the necessary knowledge and understanding of environmental requirements.

Thus we recommend that EEAA would develop a mechanism for cooperation between the Branch Regional Offices (BROs) and “Environmental Departments” in different governorates headquarters, and NGOs to provide one‐to‐one consultation on inspection procedure and environmental requirements. Thus M/SMEs would be able to apply for consultation in order to prepare their organizations for inspection.


No.

Scope

Level


5 0 0 Ensure that penalties stipulated by the new amendments to the environmental law are proportional to the magnitude of the environmental infringements

Amendments to environmental law

6 0 0 Increase the number of qualified environmental inspectors

None

7 0 0 Develop and publish Enterprises Environmental Compliance Index

None

8 0 3 Publish the inspection reports through EEAA website

None

9 0 3 Provide Pre‐Inspection consultation None 10 0 0 Conduct awareness seminars directed to

M/SMEs None

Table 9 – Recommendations on Compliance and Enforcement

2.4. Ranking and Indexes related to Clean Environment 2.4.1. Local Status According to the 2006 Environmental Sustainability Index (ESI), which is a composite index tracking for several indicators including: natural resources, pollution levels, and environmental management efforts that characterize and influence environmental sustainability on a national scale, Egypt is one of the countries that improved their ranks.



Feature

Egypt

Canada

UK

Mexico

Morocco

Clean Environment Ranking

85 8 5 66 68

Table 10 – Ranking Comparative Study

The Environmental Sustainability Index (ESI) benchmarks the ability of nations to protect the environment over the next several decades. It does so by integrating 76 data sets – tracking natural resource endowments, past and present pollution levels, environmental management efforts, and a society’s capacity to improve its environmental performance – into 21 indicators of environmental sustainability.

These indicators permit comparison across five fundamental components of sustainability: Environmental Systems; Environmental Stresses; Human Vulnerability to Environmental Stresses; Societal Capacity to Respond to Environmental Challenges; and Global Stewardship.

A high ranking on the ESI suggests better environmental stewardship. It indicates that these countries have substantial natural resource endowments, low population density, and have managed the challenges of development with some success. A low ranking suggests that these countries are facing numerous issues, both natural and manmade, and have not managed their policy choices well. Whereas a middle ranking suggests that the country is performing well in terms of issues such as water quality and environmental protection capacity and low performance on other issues, such as waste generation and greenhouse gas emissions.

According to the 2006 Environmental Sustainability Index (ESI) The United Kingdom ranks 5th and Canada ranks the 8th, whereas Mexico ranks 66th and Morocco ranks 68th.

2.5. Barriers to adopting Good Environmental Practices 2.5.1. Local Status Adhering to good environmental practices is a voluntary initiative and not a mandatory action disciplined by Egyptian law, since neither the law nor the executive regulations specify standards for good environmental practices. As well, the law is not fully activated and enforced as mentioned earlier. According to The Support for Environmental Assessment and Management (SEAM) program report23, barriers to the implementation of Environmental management systems and complying with good environmental practices are: 23 "Guide for Cleaner Production Opportunity Assessments in Small and Medium Enterprises"


1. Lack of expertise, awareness and adequate information 2. Community resistance to change 3. Production personnel is not exposed to environmental considerations within their

industrial units. 4. Lack of communication within the business / units / enterprises 5. Competing business priorities; in particular, the pressure for short‐term profits 6. Perception of risk 7. Difficulty in accessing cleaner technologies 8. Accounting systems that fail to capture environmental costs and benefits

A UNEP study24 has enumerated a number of barriers and challenges limiting the widespread implementation of cleaner production and EMS in Egypt. These barriers can be classified into financial, technical, informational, and social barriers.

Field Survey

This assignment entailed a field survey with a selected sample from M/SMEs that are working mainly in three sectors, namely Textile, Food and Chemical industries. 66 enterprises were interviewed, 13 from the textile sector, 14 from the food sector, 10 from the chemical sector and 29 working in other industries.

M/SMEs Sample Sizes

5-1516-3031-5051-7071-200

Figure 7 – M/SMEs Sample Sizes

10 enterprises were owned by females (15%) while 56 were owned by males (85%).

The sample covered different enterprise sizes. 3 enterprises had 5‐15 workers, 4 had 16‐30 workers, 18 had 31‐50 workers, 8 had 51‐70 workers and 33 enterprises had 71 to 100 workers.

24 " Outline of a National Strategy for Cleaner Production: The Case of Egypt", Journal of Cleaner Production, 2004


The field questionnaire (included as 5.2 Annex B: Field Survey Questionnaire) was designed to explore the main barriers facing to adopting good environmental practices.

Companies with Good Environmental Practices

0%10%20%30%40%50%60%70%80%90%

100%

5-15 16-30 31-50 51-70 71+Company Size

Figure 8 – Companies Adopting Good Environmental Practices (GEP)

The outcomes of the survey showed that 59% of the sample is applying good environmental practices while 41% of the sample is not applying them. As Figure 8 indicates, most of the companies that are adopting good environmental practices (64% of the applying companies) are among the larger firms (with more than 71 workers). It is worth noting that almost 50% of the companies in each size segment reported that they are adopting GEP, as shown in Table 11.

Size (Number of Workers) 5-15 16-30 31-50 51-70 71+ Surveyed companies 3 4 18 8 33 Adopting GEP 2 2 7 3 25

Table 11 – Companies Adopting Good Environmental Practices (GEP)

According to the survey, the main three barriers facing M/SMEs in terms of adopting good environmental practices are:

• Lack of awareness and social indifference,

• Financial limitations, and

• Technical barriers

Lack of Awareness and social indifference

The survey showed some interesting outcomes. 97% of the sample is aware of the organizations responsible for environmental inspection, while 73% is aware of the existence of environmental law and regulations. 83% stated they know about waste management systems and only 48.5% stated their awareness of the “Clean Production” program.


Participation in Environment Initiatives

0%10%

20%30%40%50%

60%70%80%

90%100%

5-15 16-30 31-50 51-70 71+Company Size

Figure 9 – Companies participation in environmental initiatives

In spite of the outcomes shown in Table 11 above, when asked about participating in environmental initiatives, only 27% answered positively, while 73% answered negatively. Of this percentage, 44% were companies in the middle size category (with 31‐50 workers) and 56% were in the largest segment (with more than 71 workers).

13.6% of the surveyed M/SMEs do not believe that being environmentally cautious is important, while 6.1% of the sample do not see a positive or negative impact on their businesses from good environmental practices. Table 12 illustrates the stated reasons for not applying GEP.

Size (Number of Workers) 5-15 16-30 31-50 51-70 71+ Surveyed companies 3 4 18 8 33 Financial Barriers 1 2 10 4 7 Technical Barriers 0 0 1 0 0 Applying GEP is not improtant 0 0 6 3 0 GEP has no impact on the business 1 1 1 0 1

Table 12 – Reasons for not adopting Good Environment Practices (GEP)

Although environmental media campaigns exist on television and in newspapers, the Egyptian public still lacks awareness and understanding of the consequences of polluting production practices, and how cleaner production practices improve the overall situation, both from environmental as well as economic stand points. Even among large enterprises, and especially among SMEs, there is limited general awareness of the concept of cleaner production and principles of EMS among most of the corporate management.

The fact that many of the operating firms in the Egyptian markets lack appreciation of the environmental dimension pertaining to industry essentially discourages SMEs from the implementation of EMS.


Nevertheless, by implementing cleaner production, Egyptian products may gain a competitive advantage over products from other parts of the world where classic (probably polluting) technologies are still in practice. Cleaner production is equally important for the corporate image of Egyptian companies, which is another factor that would help increase export opportunities. Companies that adopt and implement cleaner production can reap the benefits of a greener image, in a world that places a heavy emphasis on environmental issues and greener industrial practices.

In the face of increasing pressures of globalization, cleaner production is a must if Egyptian industries are to remain competitive in export markets, as well as in internal markets. Implementation of cleaner production in Egyptian manufacturing processes will result in products that are better, cheaper, and less polluting and help open more of the world markets for Egyptian products, giving them a much needed competitive advantage. Egyptian industry will also be able to claim environmental‐friendly products and production processes.

Financial Limitations

34.8% of the surveyed sample stated that lack of financial resources is the main barrier to adopting good environmental practices (see the first row in Table 12).

In a developing country such as Egypt, financial resources may be a major hurdle to the initiation of cleaner production projects and the implementation of Environment Management Systems (EMS). M/SMEs are especially vulnerable to this barrier, due to their lack of access to finance, inadequacy of external capital and the absence of appropriate funding mechanisms. Similarly, applying EMS represents an administrative and time burden to Egyptian SMEs.

Technical barriers

Technical barriers were the least among other barriers according to the field survey. Only one company (of the 31‐50 workers segment) stated that the reason behind not adopting good environmental practices is technical, i.e. they are not capable of meeting the technical requirements for good environmental practices.

The reason for such a low percentage is that most of the surveyed sample has limited or no awareness about environmental technical requirements. M/SMEs in developing countries, such as Egypt, lack the technical know‐how required to implement environmental management systems, they may also not have access to the technology required to implement cleaner production on‐site.

As large corporations initiate different activities to improve the communities in which they are working as part of their social responsibility, it is possible for such corporations to support/sponsor different technical assistance initiatives that aim to assist M/SMEs in complying with environmental requirements.



Feature

Egypt

Canada

UK

Mexico

Morocco

M/SMEs possess general knowledge and awareness about environmental issues

SMEs possess knowledge and awareness of EMSs Community supports modifying harmful environmental behaviors

Environment considered a central business concern for most SMEs

Implementing EMS does not impose unnecessary administrative burdens on SMEs.

Environmental compliance or implementation of EMS is not considered a waste of time by SMEs.

Increasing cost is not a barrier for environmental compliance or the implementation of EMS

Local Market forces identified as a driver for improving environmental practices

International Market requirements identified as a driver for improving environmental practices

Trade association requirements identified as a driver for improving environmental practices

Reforming regulations surpasses incentive programs in terms of improving environmental practices

Level of dependence on Economic incentives as an effective mechanism for improving environmental practices (H, M, L)

L M M H L

Establishing a successful network among SMEs, large companies, universities and government agencies regarding compliance and EMS implementation

Table 13 – Drivers and Barriers Comparative Study

Throughout the research, a number of barriers to the implementation of Environmental Management systems among SMEs and environmental compliance in general were identified. Lack of knowledge about environmental issues in general or about EMS in particular is one of these barriers. Other barriers include community resistance, lack of financial resources, and lack of time, in addition to a general lack of concern about such issues. Nevertheless, in the four‐country scan, certain factors were perceived as drivers to achieve more compliance. For instance, it was perceived that some trade associations require their members to have an environmental management system, a fact that contributes to achieving more environmental compliance. Market forces were also identified as a driving force for environmental compliance and EMS implementation in certain countries. These forces include local


market requirements in some countries and international market and export requirements for others. Furthermore, it has been identified in some countries that applying incentive programs stands as an effective driver for applying EMS, although it experiences in other countries indicate that reforming and enforcing regulations is a more powerful driver than use of incentives to encourage people to change their behaviours. Finally, it has been generally perceived that networking among different entities of society positively affects the degree of environmental compliance.

A scan of the four countries regarding the impact of networking revealed a lack of knowledge and awareness of environmental issues in general in both Mexico and Morocco. A lack of awareness of management systems was identified as a big barrier to their implementation, even in Canada, the second among the scanned countries in terms of Environmental Compliance. A survey conducted by the Canadian Federation of Independent Businesses25 found that nearly three‐quarters of the 4,322 respondents to an environmental survey of its members were not aware of ISO 14000.

Another identified barrier to the implementation of environmental management systems is community resistance to modifying harmful environmental behavior. Social resistance and lack of interest among UK workers is considered one of the main barriers to compliance with environmental legislation26. Similarly in Mexico, social resistance was one of the major problems impeding environmental compliance27.

This was not the case in Canada, where the Office of Enforcement in the Canadian Department of Environment in Environment Canada has declared that the general populace has made great strides in recognizing their role and accepting responsibility for protection of their own environment. The Office indicated that the average citizen can make sacrifices for the benefit of the environment, and accordingly industry is expected to be judged in comparison to the higher standard of care.

Moreover, it is clearly noticed in all the scanned countries that Environment is not yet seen as a central business concern for most SMEs. A survey conducted by NetRegs in 200328 to assess environmental behaviors among smaller UK businesses (more than 8,000 small‐sized UK businesses) revealed that many of them have very low concern about environment as a business issue.

The same survey indicated that, so far, market‐based mechanisms have had limited success in affecting environmental reform among small UK businesses. In other

25 http://www.cec.org/files/PDF/LAWPOLICY/EMS-Report_en.pdf 26 "UK Small Firms and Their Response to Environmental Issues", Environment and Human Behavior program ,2003 27 Report No. 18071-ME, Mexico, the Guadalajara Environmental, Management Pilot 28 www.environment-agency.gov.uk/commondata/acrobat/smenvironment_uk_2003.pdf


words, local market requirements are not an effective driver for improving environmental practices. For instance, in the food and restaurants sectors in UK, market forces appear to be doing little to encourage environmental reform as most restaurateurs do not believe that being environmentally‐friendly will be a particular draw for customers. Although many are advocates of organic food, in UK restaurants do not offer organic options on their menu due to high prices and problems of limited supply.

Nevertheless, market forces have started to be identified in Morocco as a driver for improving environmental practice and increasing compliance. For example, one of the environment‐related principles established by The United States‐Morocco Trade Agreement is to ensure that a party to a trade agreement with the United States does not fail to effectively enforce its environmental laws, through a sustained or recurring course of action or inaction, in a manner affecting trade between the parties, while recognizing a party’s right to exercise discretion with respect to investigatory, prosecutorial, regulatory, and compliance matters and to prioritize allocation of resources for environmental law enforcement29.

As for SMEs in Mexico, market forces are particularly important. Mexico has a large, informal economy where smaller businesses may be subject to fewer regulatory pressures. A recent Inter‐American Development Bank study of ISO 9000, and to a lesser degree ISO 14001, in certain areas of Latin America, including Nuevo Leon in Mexico, found that a key determinant of the quality of the environmental management system was the extent to which management demanded the system. However, despite these market forces, for most SMEs, the barriers to EMS adoption outweigh the drivers.

Generally, for a small and medium‐size business, one tangible value in creating and implementing an EMS is that such a step will meet the requirements of larger customers or dominant buyers. Large multinational companies are increasingly requiring their suppliers to adopt environmental management systems that directly affect SMEs. By choosing not to do business with firms that do not adhere to their environmental policies, large multinational companies are able to greatly influence the environmental impacts of their smaller suppliers and distributors.

DaimlerChrysler, Ford, General Motors and Sony, for example, now require ISO 14001 certification of their primary and secondary suppliers. Large companies impose these requirements for a variety of reasons. Among them are reduced risk, new European Union regulations that are restricting substances in consumer products, direct financial savings, improved relations with their customers or regulators and recognition of responsibility for their environmental impacts.

29 http://www.ustr.gov/assets/Trade_Agreements/Bilateral/Morocco_FTA/asset_upload_file569_5831.pdf


Scanning the four countries, it was perceived that SMEs are generally less likely to implement EMSs because they are largely preoccupied with the day‐to‐day concerns of keeping their businesses viable and retaining existing customers. In addition, the referred to survey of NetRegs indicated that there is a lack of resources to invest in environmental management. One of the key reasons behind resistance and inattentiveness to environmental compliance is the fact that environmental compliance often presents unnecessary burdens including administrative and financial limitations and lack of time.

Similarly, a report indicating barriers facing Mexican SMEs’ adoption30 asserted that there was a widely expressed concern regarding the ISO 14001 model as inappropriate for adoption by SMEs. Smaller companies find it both costly and difficult to implement formal EMSs due to their largely informal management systems and resource constraints, particularly with respect to personnel time and financing. Fifty‐four percent of the SMEs considered lack of time a critical barrier to EMS implementation. On the other hand, the report identified a number of driving forces pushing towards more environmental compliance including economic incentives, trade association requirements, legislation reforming and networking.According to the report, some trade associations require their members to have an environmental management system in place or to adhere to environmental codes of conduct. For example, national chemical associations in 52 countries run Responsible Care programs. Under Responsible Care, member companies must commit to adopting a set of guiding principles, codes, guidelines and checklists on health, safety and environmental matters, and to developing indicators and verification procedures. They must communicate their ʺgood faith effortsʺ to implement the codes to employees and stakeholders.

The Mexico National Association of the Chemical Industry (ANIQ) was the first association to design a Responsible Care program as an environmental health and safety management system. It incorporates elements of ISO 14001 and fulfills other requirements of different known management systems related to environmental, health and safety issues. Adoption of the Responsible Care program is a condition for becoming a member of ANIQ.

Another example is the Environmental Commitment and Responsibility program of the Canadian Electricity Association (CEA), which counts small and medium‐size businesses among its members, stipulates that adoption of an ISO 14001 consistent EMS is a condition of membership.

Within Canada and Mexico, the traditional environmental regulatory actions are being carried out in conjunction with non regulatory voluntary programs designed to provide incentives for greater environmental performance. Each country has

30 http://www.cec.org/files/PDF/LAWPOLICY/EMS-Report_en.pdf


programs designed to encourage the use of environmental management systems and these efforts are largely voluntary and incentive‐based. Nevertheless, a Report for Industry Canada, prepared by E2 Management Corporation, indicates that the majority of a sample of Canadian SMEs agreed that there were a clear lack of incentives from government.

The Canadian Environmental Protection Act (CEPA) recognizes the use of certified environmental management systems to achieve performance requirements and gives the courts the authority to require a company to become certified in a ʺrecognizedʺ EMS standard as part of the court‐ordered option. Some Canadian companies have been required by the courts to develop a certifiable EMS as part of a penalty for poor compliance.

As for the United Kingdom, the Kingston University study highlighted that, although there have been numerous government and industry‐led voluntary initiatives to encourage compliance in the construction sector, it was legislation that SMEs saw as the only thing really driving environmental reform in the sector. “Waste disposal regulations had encouraged builders to dispose of waste in an appropriate manner, and amendments to the building regulations had encouraged much greater levels of energy efficiency in building design.” Furthermore, the study indicated that more severe environmental legislation is the only way to ensure that the industry reduced its environmental impact. The study indicated that economic incentives also have the potential to be an effective mechanism for stimulating change. It asserted that environmental taxes can be effective because they make voluntary action profitable; and the same applied to reduced VAT on accredited supplies, stamp duty relief on sustainable homes, capital allowances for expenditure on sustainable conversions and abolition of the zero percent VAT rate on new buildings.

However, economic incentives cannot always be relied upon to achieve change amongst SMEs. This is because owner‐managers may perceive such incentives as not justifying the extra cost and management burden. For instance, builders may feel that a tax credit on recycled materials is not enough to compensate for the extra management and labor time required to observe proper waste management procedures on site. Accordingly, the study concludes that to be truly effective, economic incentives need to be combined with the kinds of infrastructure developments that make it easy for firms to be more environmentally proactive.

In other words, it has been perceived that in the United Kingdom for instance, the government has a major role to play, not just in encouraging firms, but in enforcing compliance; this will not be attainable unless the government makes it possible and easy to comply.

As for Morocco, no evidence for relying on incentive programs as an effective mechanism for improving environmental practices was found.


Among the four countries scanned, only Canada presented a high level of successful networking among different entities of society in relation to environmental issues.

Environment Canada has a long tradition of working in partnership with others. Through partnering and networking, it uses its scientific leadership to support and influence the environmental goals of others, such as provincial departments, communities and non‐profit organizations. The entity realizes that such partnerships are more critical now than ever, because environmental issues are no longer local or even regional in nature.

2.5.3. Conclusion There are several lessons to be learned from the international experience:

• Lack of awareness and understanding of environmental requirements and importance is the major factor that hinders adoption of Good Environmental Practices (GEP).

• Local markets as well as export markets support and impose adoption of GEP on all working enterprises, especially M/SMEs.

• Incentives, in the form of financial support and technical assistance, could form an important driver for improving environmental practices.

2.6. Incentive Programs for Compliance and Certifications 2.6.1. Local Status The Egyptian government has long adopted the carrot and stick principle regarding environmental compliance; in addition to fining as stated in the environment law, an incentives system has also been introduced. EEAA, in collaboration with the Ministry of Finance, was assigned to establish an incentives system that may be granted by EEAA or other administrative bodies to authorities, establishments and individuals who undertake actions or launch projects for preserving the environment.

According to the EEAA, the successful response to environmental challenges relies on the presence of supportive financing mechanisms presenting incentives for the stimulation of investments in the environmental management and protection fields. Accordingly, the EEAA operates the following programs:

1. The Environmental Protection Fund (EPF)

EPF was established under Law 4/1994 for the Environment with the aim of mobilizing investments in the environmental sector. The financial resources of the EPF include revenues from the national protectorates entrance fees, and fines on environmental violations.

The EPF provides financial assistance to environmental projects on a competitive basis. In this regard, a broad range of organizations, including private sector enterprises, public institutions and non‐governmental organizations, are eligible to


apply to the EPF for supporting their implementation of environmental projects and initiatives. Applicants, however, must meet preset criteria primarily concerned with their ability to cover a share of the projects costs, as well as demonstrate their capability, both financially and technically, to undertake the proposed project.

Each year, the EPF issues a plan describing the financial support program offered for that year, specifying the types of financial packages provided, as well as the areas of focus based on the national environmental priorities. The financial packages offered by the EPF include interest rate subsidies on commercial loans, equity participation, as well as grants offered to non‐profit environmental projects on a cost‐sharing basis. According to the selection criteria published on the EPF website31, any locally‐registered legal entity, including M/SMEs is eligible to benefit from the support program provided it complies with the selection criteria.

2. Cairo Air Improvement Project (CAIP)

CAIP, sponsored by EEAA and USAID, has addressed air pollution in metropolitan Cairo at a number of levels. To address fine particle emissions, CAIP instituted vehicular emissions testing, the first of its kind in Africa. It also has pushed the use of compressed natural gas (CNG) as a fuel for municipal buses, private vehicles, and as energy for power plants throughout greater Cairo. As of 2001, 50 municipal buses were using CNG and multiple CNG fueling stations were set up throughout Cairo. To date, there are 50 fueling stations dispensing CNG to the 40,000 CNG vehicles in the Cairo metropolitan area.

Finally, CAIP has addressed the high levels of lead in Cairo by promoting the use of environmentally friendly technologies at lead‐smelting plants and by supporting the removal of such facilities from populated areas. Four smelting plants have been relocated outside Cairo, and the new facilities are equipped with advanced pollution‐control technology to further reduce their lead emissions.

CAIP does not address one major cause of urban air pollution ‐‐ the burning of garbage. Waste incineration in a large city can be easier and less expensive than treating, compacting or removing the refuse from the city. However, fine particles are released when garbage is burned and can contribute to smog and damage human health.

Rather than addressing this issue as an air pollution problem, Egypt has moved forward on a comprehensive waste management system that should eliminate the need for burning refuse in major cities. In 2000/2001 Egypt began the Integrated Solid Waste Management program to establish the regulatory framework in which effective waste management can operate. Over the past two years the program has progressed such that at the end of 2002 numerous sites were selected for further testing as potential landfills.

31 http://www.eeaa.gov.eg/epf/financial_support_program_2000_2001.htm#4


3. Financial Packages for Industrial Compliance

Within the context of the importance accorded by the Ministry of State for Environmental Affairs (MSEA) to industrial compliance, as specifically reflected in the policy directives and the adopted five year action plan, three financial packages are made available to assist major industrial establishments. The underlying objective is to promote investments for pollution abatement and the implementation of cleaner technology initiatives.

The World Bank is providing access to US$35 million, made available on a soft loan basis, for supporting pollution abatement projects, of which a total amount of about US$15 million has been already allocated over the past year to ten major polluting industries.

A number of changes to the conditions of these funds have been carried out during 2000/2001 with the aim of broadening the scope of support. These changes include the extension of the geographical scope for the allocation of funds to include all governorates of Egypt, as well as the extension of support to new industrial sectors such as the cement, petrochemical and pharmaceutical industries. Furthermore, financial modifications entail the development and implementation of measures to avoid risks resulting from exchange rate fluctuations.

The European Investment Bank (EIB) as well is making available a total of 15 million Euros, as soft loans. The primary focus of the EIB loans lies in the conversion of combustion processes of the different industrial establishments to natural gas.

As for the German Bank for Reconstruction (KfW), access to a total of 50 million Deutsch marks (DM32) targeted public enterprises in the industrial sector for end‐of‐pipe, in‐plant pollution abatement and prevention projects. In this respect, projects in 14 establishments were allocated a total cost of 20.3 million DM in 2000/200133.

4. Egypt Environmental Initiatives Fund (EEIF):

The overall aim of the Egypt Environmental Initiatives Fund (1997‐2009), supported by the Canadian International Development Agency, is to promote the involvement of the Egyptian private and voluntary sectors in sound and sustainable environmental practices and management.

This project focuses on the climate change initiative as part of the Egypt Environmental Initiatives Fund (EEIF). This project assists the Government of Egypt in reducing the growth of greenhouse gas emissions by converting 50 brick‐factory kilns near Cairo to natural gas technology. The project helps factory owners/managers install the new equipment and trains maintenance staff.

32 Equivalent to € 25,564,594 (according to the exchange rate accepted by the EU commission (1 €= 1.95583) and valid during the period 1/1/1999 till 31/12/2001 (http://ec.europa.eu/budget/inforeuro/index.cfm?fuseaction=currency_historique&currency=48&Language=en) 33 Equivalent to € 10,379,225 (according to the previous reference)


This is achieved through three lines of action:

• The first, targeting the private sector SMEs, aims at improving the environmental performance of such SMEʹ, as well as promoting adoption of sound environmental management practices, through technical and financial assistance.

• The second line of action is to target the voluntary sector composed of NGOs and community development associations (CDAʹs), aiming at increasing their capacity to deliver community‐based environmental improvement initiatives.

• The third line of action supports the development and expansion of green businesses in Egypt.

The operational strategy of the Fund is based on sustainability; both financial and institutional, achieved through support for replicable, financially self‐sustaining demo‐projects, as well as the involvement of ʺimplementation partners teamsʺ composed of stakeholders, local government and beneficiaries.


Feature Egypt

Canada

UK

Mexico

Morocco

Types of incentive programs for SME’s compliance and certifications: (Taxes relief (T)/ Business development (B)/ Grants (G)

G T‐B‐G T T G

Focus of incentive programs: (Industry sector (I)/ Regional area (R)/ Environment element ʺAir, Water, Land. (E)

I I‐E E E I‐R

Table 14 – Incentive Programs Comparative Study

Within Canada, the traditional environmental regulatory actions are being carried out in conjunction with non‐regulatory voluntary programs designed to provide incentives for greater environmental performance. Although no federal incentive program exists in Canada, each province has programs designed to encourage the use of environmental management systems; these efforts are largely voluntary and incentive‐based.

As for UK, and according to the previously mentioned study, “UK SMEs and their Response to Environmental Issuesʺ, economic incentives, especially taxation instruments, have the potential to be an effective mechanism for stimulating change in the area of environment. According to the study, environmental taxes can be effective because they make voluntary action profitable; taxing environmental bad practices and rewarding environmental good ones provides the price signals needed to establish the business case for sustainability.


Furthermore, a study titled “Fiscal Incentives for Sustainable Homes” identifies a list of potential market‐based mechanisms that could promote more environmental sustainability in the construction filed in UK. The list includes “carrots” (such as reduced VAT on accredited supplies, stamp duty relief on sustainable homes, capital allowances for expenditure on sustainable conversions and abolition of the zero percent VAT rate on new builds), as well as “sticks” (such as a “Greenfield” levy and product charges on non‐sustainable building materials and equipment).

Taxation is possibly one of the most widely used methods of economic incentives. According to UK, one of the key advantages of environmental taxes is that they correct market failures by incorporating the costs of pollution and other environmental costs into prices ‐ the “Polluter Pays Principle”. However, environmental taxation is not always applauded politically as it can be perceived to create problems in international competitiveness, impose proportionally high impacts on low‐income categories, produce conflicts between national and international legislation, etc.

However, governments can also use other fiscal measures. For example, an alternative to taxing undesirable behavior is the rewarding of environmentally friendly behavior, thus re‐balancing relative prices. Although the UK Government has, like many other Governments around the world, introduced the concept of environmental taxation (e.g. Climate Change Levy, Aggregates Levy and Landfill tax), its fiscal measures have recently concentrated on rewarding good behavior rather than taxing bad behavior.

In Mexico, the use of economic incentives is still limited, and has been directed mainly at controlling pollution and access to certain natural resources. Subsidies and tax exemptions are the most common instruments used. Environmental taxes for gasoline are levied in Mexico on the basis of lead content to reduce polluting emissions and limit consumption. Green taxes to support environmental policies are also introduced, but they are unlikely to become a major priority due to serious arguments raised by revenue agencies.

In Morocco, and as part of its investment incentives programs, special incentives are available to encourage companies to comply with environment protection laws or install environment protection equipment. Companies whose investment program, technology used, or region where it should be carried out contributes to environment protection can drive contact with the government and receive grants.

2.6.3. Recommendations To‐date, there are several donor programs and governmental funded initiatives that are supporting industrial enterprises (where large of M/SMEs) in their efforts to comply with environmental requirements. However, such funds are not expected to last forever, and this would leave M/SMEs with heavy financial burdens that will


eventually discourage them to continue investing their limited financials in environmental compliance and management.

2.6.3.1. Develop a structured tax incentive program to support environmentally complying M/SMEs

As mentioned earlier, funded support will not be available for industrial enterprises for ever, an eventuality that will leave enterprises, and especially M/SMEs, with heavy financial burdens. This would lead eventually to abandoning any costly efforts to be environmentally compliant.

The international experience showed that most of the scanned countries adopt a tax relief system to encourage and award industrial enterprises to integrate environmental good practices in their production processes.

It is recommended that the Egyptian government similarly adopt a tax relief system for environmentally complying enterprises. For example, relieving the products of such enterprises from sales taxes would compensate for the financial costs and management efforts exerted in environmental good practices. This would encourage currently complying enterprises to sustain their efforts and investments, and encourage non‐complying companies to start implementing environmental good practices.


No.

Scope

Level


11 1 1 Develop a structured tax incentive program to support environmentally complying M/SMEs

Ministerial Decree

Table 15 – Recommendations on Incentive Programs for Compliance and Certifications

2.7. Technical Assistance and Outreach 2.7.1. Local Status The Egyptian Ministry of State for Environmental Affairs and the Egyptian Environmental Affairs Agency contribute in delivering technical assistance in the area of increasing environmental awareness all over the country through the “Green Corner Work Plan”. The strategy aims to developing a new generation capable and responsible for the protection of the environment, in addition to change the behaviors into positive attitudes towards the environment and to its problems. Nevertheless still such contributions are not industry oriented.


There are several programs and projects related to improving environmental compliance. These programs include for instance;

• Support for Environmental Assessment and Management (SEAM),

• The Egyptian Pollution Abatement Project I & II,

• Achieving Compliance with environmental regulation in Industry (ACI), and

• Egyptian Environment Initiatives Fund (EEIF)

Egypt still suffers a deficiency in preparing and following‐up on environmental education, training and awareness programs. In spite of the availability of abundant environmental programs, it seems that the lack of involvement of key stakeholders and the absence of coordination mechanisms contribute to the weak implementation of environmental compliance.

With regard to the contribution of large enterprises in assisting SMEs to become more environmentally compliant, multinational corporations proved to contribute more to social issues. Unlike developed countries like Canada and UK, and similarly like developing countries including Mexico and Morocco, social contributions are not very much guided and directed towards environmental improvement. In other words, environmental improvement is not of a top priority among the areas addressed by such corporations.

Nevertheless, this study detected a number of examples indicating cases for corporate contributions to a better environment including nationals and multinationals. Speaking about the multinational corporations’ level, the study presents the case of TOYOTA MOTOR CORPORATION and COCA‐COLA. On the national corporations’ level, the study is presenting two examples including; MobiNil and Orascom Construction Industries (OCI).

TOYOTA MOTOR CORPORATION

This is a multi national corporation that recognizes environmental issues as a top management priority for sustainable development. It is a corporation contributing to environmental conservation, with advanced and diversified technologies, for the purpose of gaining trust and respect of all the customers around the world.

Accordingly, the company has initiated a number of world‐wide corporate activities to achieve their commitment to the environment. Among those activities conducted in Egypt are the following projects:

• Sustainable Management and Conservation of Drylands Natural Resources and Watersheds (Surface Water) in the Western Coastal Desert of Egypt

• Environment and Human Development Association (EHDA) in Egypt.


COCA‐COLA COMPANY

Coca‐Cola is working with community leaders and officials to develop locally relevant environmental programs. Some of the programs they have created focus on watershed conservation, community water and sanitation programs, community litter abatement and cleanup initiatives, and environmental education programs.

For example, the company launched a three‐year program with MSEA, USAID and other partners to protect the coral reefs of the Red Sea. After clearing the seabed in 2005, the partnership is now establishing the first solid waste recycling program, creating an estimated 14,000 jobs among local Bedouins.

MOBINIL

As a mobile operator in Egypt and the first to be an ISO 14001 certified company in the Middle East, Mobinil recognized the importance of environmental responsibilities. The company community investment includes supporting projects that encourage sustainability and environmental protection, such as Waste Battery Collection and Recycling, and the tree planting initiative.

ORASCOM CONSTRUCTION INDUSTIRES (OCI)

OCI is a leading cement producer and construction contractor active in emerging markets. It is based in Cairo, Egypt and employs more than 40,000 people in 20 countries. The company recognizes that it has a social responsibility to its stakeholders and is committed to acting in accordance with international best practices for corporate governance, corporate citizenship and sustainable development.

OCI is striving to minimize the environmental impact of its activities and to promote sustainable development by conserving energy, materials and resources through minimizing consumption, maximizing efficiency and effectively managing waste.

Community Environment Action Project

The CENACT project was officially launched in January 2004 and will run for four years. It started its implementation in the Governorates of Ismailia and Al Menia, with expansion plans in other governorates.

CENACTʹs purpose is to strengthen and increase NGO participation in environmental management within the context of the national policy of partnership in environmental improvement. It also aims at increasing the coordination between civil society organizations and the community with governmental agencies at the Governorate level and the National level, through the NGO Unit of the Egyptian Environmental Affairs Agency (EEAA). CENACT also aims at developing the technical and organizational capacity of the NGO Unit of the EEAA.

The initiatives that CENACT supports must target three main themes:


• Environmental sustainability ‐ initiatives must contribute to improvements in the local environment.

• Cultural sustainability ‐ initiatives must promote gender equality within the cultural norms and standards of behavior of the community in which the initiatives are being implemented.

• Economic sustainability ‐ initiatives must create jobs and be able to generate revenue to cover their operational costs.


Feature (High (H), Medium (M), Low (L)) Eg

ypt

Canad

UK

Mexic

Moroc

Level of awareness and training contribution to environmental compliance

M H H H M

Level of Technical consultation programs contribution to environmental compliance

M H ?? M M

Level of implementation assistances contribution to environmental compliance

L H ?? H L

Level of responsibilities on Large enterprises to increase awareness and to assist other SMEs to be compliant

L H H M L

Large enterprises efforts to increase awareness and to assist other SMEs are organized and guided

Table 16 – Technical Assistance and Outreach Comparative Study

Since Environmental Management Systems do not provide an organization with explicit tools on how to manage waste, prevent discharges or reduce air emissions, technical assistance programs are considered as essential tools for encouraging the adoption of environmental management systems by SMEs as they can help address the technical shortcomings of smaller businesses and respond to the specific needs of a particular industrial sector. They can help address environmental issues identified during EMS implementation. Outreach programs and technical assistance tools tend to be most successful when they are developed and delivered at the regional level and tailored to the specific needs of businesses.

The following paragraphs present technical assistance programs for SMEs as found in the scanned countries.

In Canada, Environmental Canada, Industry Canada and the provincial governments have programs designed to improve the environmental performance of SMEs. These programs are largely developed to support non‐regulatory pollution prevention initiatives targeting SMEs. Samples of Technical Assistance Programs in Canada are presented in (Annex E: Technical Assistance Programs in Canada).


In the United Kingdom, there is the “Environmental Awareness Program” which is an advisory initiative helping businesses to become aware of environmental issues and improve their environmental performance. Key informants highlighted that due to the construction industry’s high public profile in UK, there have been numerous government and industry‐led voluntary initiatives to encourage best practice, all with sustainability as part of their remit. Such schemes were felt to have raised awareness of the importance of sustainable construction.

In Mexico, several projects have been undertaken to provide SMEs with technical assistance in implementing environmental management systems. For instance, the Guadalajara Environmental Management Pilot (GEMP), financed by the World Bank, studied the effects of EMS use in small and medium‐size enterprises in Mexico. In this project, 11 large companies in Guadalajara, Mexico, signed a voluntary agreement with Mexico’s Ministry of Environment, Natural Resources and Fisheries, now known as the Ministry of Environment and Natural Resources, to mentor small suppliers in implementing EMSs. Within three months of completing the formal EMS training, over 80% of the 20 participating companies in the GEMP study had reduced their environmental releases, nearly 70% had improved their work environment, and over 50% had improved their economic performance. Slightly less than 50% reported improvements in waste handling, materials and energy efficiency, and compliance. Samples of Technical Assistance Programs in Mexico are presented in (Annex D: Technical Assistance Programs in Mexico).

In Morocco and based on 2005‐2007 Plan of Action Pursuant to the U.S.‐Morocco for a Joint Statement on Environmental Cooperation, a number of priorities were set to provide technical assistance to Morocco with the goal of improving Morocco’s ability to protect the environment by building human and institutional capacity in management and conservation of natural resources.

“Corporate Social Responsibility (CSR)” is emerging as an important concept for in the work large enterprises do to assist SMEs increase their environmental compliance, whether on voluntary or obligatory basis. CSR is a concept whereby organizations, especially (but not only) corporations, have an obligation to consider the interests of customers, employees, shareholders, communities, and ecological considerations in all aspects of their operations. This obligation is seen to extend beyond their statutory obligation to comply with legislation. CSR is closely linked to the principles of Sustainable Development, which argues that enterprises should make decisions based not only on financial factors, such as profits or dividends, but also based on the immediate and long‐term social and environmental consequences of their activities. Both Canada and UK have accomplished progressive strides in this area.

Canadians have high expectations of the private sector for responsible behavior. Consumers expect goods and services to reflect socially and environmentally responsible business behavior at competitive prices. Shareholders also search for


enhanced financial performance that integrates social and environmental considerations. For example, according to a 2003 Environment poll conducted for Environment Canada34, 9 out of 10 Canadian shareholders wanted fund managers to take environmental and social performance into account when valuing companies. Also, in a 2004 GlobeScan survey, while 17% of Canadian respondents indicated that they had read a corporate social or environmental report, 77% indicated an interest in learning more about corporate social responsibility. In addition, 71% noted their belief that consumers can make a difference in how responsibly a company behaves.

In UK, the Government sees CSR as the business contribution to their sustainable development goals. It is about how business takes account of its economic, social and environmental impacts in the way it operates – maximizing the benefits and minimizing the downsides. CSR is a voluntary action that business can take, over and above compliance with minimum legal requirements, to address both the businesses competitive interests and the interests of wider society.

Mexico has realized the importance of networks among SMEs, large companies, universities, and government agencies as an effective mechanism to promote implementation of EMS by SMEs. Moreover, the Commission for Private Sector Studies in Sustainable Development is prompting sustainable practices such as eco‐efficiency and social responsibility in Mexico’s industrial sector. It offers workshops and seminars on sustainable development, pollution prevention and EMS.

2.7.3. Recommendations To date, there are several initiatives and donor programs that are targeting environmental compliance. During the study, it was noted that there is a need to coordinate and harmonize different programs, since each program is working according to the vision and priorities of the donor agency. It should also be mentioned that most of the working programs have achieved success with medium and large enterprises. It is a fact that 95% of the total businesses in Egypt are micro and small enterprises, and these enterprises present the highest threat to the environment due to their lack of awareness and capability to commit to “Clean Production”. Moreover, the survey revealed that approximately 35% of the surveyed enterprises are not capable of applying good environmental practices due to financial limitations.

2.7.3.1. Assign a focal point for coordinating donor programs

As mentioned earlier, different initiatives and programs are working according to the vision and priority of the donor agency. We recommend that EEAA be assigned as a focal point responsible for harmonizing different donor programs according to Egypt’s national plan and priorities.

34 http://strategis.ic.gc.ca/epic/site/csr-rse.nsf/en/rs00128e.html


2.7.3.2. EEAA to orchestrate technical assistance programs directed to Micro and Small enterprises

As micro and small enterprises present the highest threat to environment, and they lack the financial capabilities to commit to clean production processes, we recommend that EEAA, as an orchestrator, encourage different donor programs to dedicate specific technical assistance projects that are directed to MSEs. Thus, EEAA would act as the focal point from which every initiative should gain its endorsement.

We recommend that such projects be customized in order to fit the current status of MSEs and their available resources. The projects would be designed in the form that would prepare MSEs and leverage them into enterprises that are applying good environmental practices in production and waste management.

2.7.3.3. EEAA to establish closer presence for M/SMEs

To maximize the benefits that M/SMEs could gain from different initiatives, there is a need for EEAA to establish closer presence to cover different geographic areas. We recommend that EEAA extend its outreach through collaboration of its BROs with local initiatives and NGOs active in the environmental activities as well as coordinating with Environmental Management Units (EMUs) in different governorates.

2.7.3.4. Encourage entrepreneurs to enter the field of recycling industries

There are a large number of industries that are based on waste recycling. It is recommended that EEAA conduct and publish different studies to explore the potential of increasing this type of industry, showing the economic value of having such activities. In the meantime, such activities would have a positive impact in terms of providing new job opportunities, enhancing the economy and solving the problem of waste.

2.7.4. Recommendations Summary Table 17 summarizes the recommendations listed in this subsection as well as their scope, level and laws affected.

No.

Scope

Level


12 0 1 Assign a focal point for coordinating donor programs

Prime Minister Decree

13 0 3 Develop technical assistance programs directed to Micro and Small enterprises

None

14 0 3 Establish closer presence for M/SMEs None 15 0 3 Encourage entrepreneurs to enter the field of

recycling industries None

Table 17 – Recommendations on Technical Assistance


2.8. Future Directions & Planning 2.8.1. Local Status With the onset of the 1990s, the Government of Egypt embarked on two major initiatives to establish a planning and regulatory framework for environmental management in Egypt. These initiatives are: The National Environmental Action Plan (NEAP); and The Environmental Law (Law 4/1994) and its Executive Regulations. The NEAP is a framework that represents Egyptʹs agenda for environmental actions for the coming fifteen years. It complements and integrates with sectoral plans for economic growth and social development. The NEAP is the basis for the development of local environmental initiatives, actions and activities. It is designed to be the framework that coordinates for future environmental activities in support of sustainable development of Egypt. The main components of the Plan are:

• National Resource Management (land and water).

• Air Quality Improvement (Industrial & Urban).

• Solid Management (including Hazardous waste)

• Protection of Egypt Heritage

• Development of Environmental Institutions deficiency

The NEAP as a framework does not include a detailed clear plans for clean production, national resources management, or the implementation of Environmental Management Systems.

EEAA endorsed an initiative for environmental planning decentralization, with 16 governorates having already developed their environmental plans, and it is expected to be rolled‐out through the remaining governorates.

2.8.2. Comparative Study (Egypt/ International) Table 18 presents the situation for the four scanned countries in terms of future directions and planning pertaining to the different environmental elements. Both Canada and the United Kingdom present an excellent model for planning and environmental substantiality, whereas both Mexico and Morocco proved to take good strides in planning for better environment.


Feature

Egypt

Canada

UK

Mexico

Morocco

Existence of national environmental plan Existence of national clean production plan NA NA Existence of national waste management plan Existence of national EMS plan Existence of detailed national resource management plan

Existence of common environmental standards against which all industries performance is measured.

Table 18 – Future Directions and Planning Comparative Study

Examining both Canada’s Sustainable Development Strategy 2004‐200635 and Environment Canadaʹs Sustainable Development Strategy 2007‐200936, Canada proved to possess a national environmental plan, a waste management plan, and a strategy for utilizing resources. The Canadian Sustainable Development Strategy 2007‐2009 focuses on building a future shaped by a strong knowledge base which puts human and natural capital on an equal footing with economic capital. The Strategy calls upon the strategic use of market forces to ensure good economic policy becomes good environmental and social policy. It emphasizes partnerships and governance models that enable horizontal decision making at the government, community and corporate levels.

In Canada, 24 Departments have responsibility under some 30 statutes over different aspects of controlling toxic substances. Added to these are provincial and municipal regulations. The federal government’s approach to waste management is an integrated one based on the 4Rs: reduce, reuse, recycle and recovery. In December 1989, a Waste Management Branch was created within Environment Canada to coordinate the growing involvement of the federal government in waste management activities. Accordingly, Canada possesses the Federal Waste Reduction Plan (CCME).

In addition, Environment Canada proved to be further dedicated to reducing the environmental impacts of its operations by adopting a strategic approach to environmental management. It has developed the “EMS Info37” which is a website dedicated to providing information on environmental management systems (EMS) to

35 http://www.ec.gc.ca/sd-dd_consult/PDF/SDSfinal_e.pdf 36 http://www.ec.gc.ca/sd-dd_consult/SDS2007/toc_e.htm 37 http://www.ec.gc.ca/emsinfo/home_e.htm


employees of the Government of Canada, and to EMS practitioners around the world. EMS Info is supported by the efforts of the Federal Committee on Environmental Management Systems (FCEMS).

On the other hand, The UK Government, Scottish Executive, Welsh Assembly Government and the Northern Ireland Administration have agreed upon a set of principles that provide a basis for sustainable development policy in the UK. By sustainable development, the UK government means “development which meets the needs of the present without compromising the ability of future generations to meet their own needs”. Consequently, natural resources management and environmental enhancement became a key element of the UK sustainable development strategy.

The UK also has common environmental standards against which industries performance is measured. The Environment Agency in UK developed Compliance Assessment Plans (CAPs) and a Compliance Classification Scheme (CCS) whereby performance of a site is assessed against the conditions set in Agency issued permits.

The Compliance Classification Scheme is used to classify non‐compliance with permit conditions according to potential impact on the environment and provides information to support consistent and proportionate responses to non‐compliances. This also allows national profiling of sectors and companies.

England, Wales, Scotland, and Northern Ireland have each developed a National Waste Strategy which outlines how the UK plans to deal with the increasing amount of rubbish produced each year. The strategies aims are similar, they contain information on how the UK will deal with all sorts of waste, and they also contain waste statistics, and detail the different people responsible for waste management in the UK.

In addition, the 2005 UK Sustainable Development Strategy calls for an increase in the take up of EMSs. Accordingly, UK organizations have made rapid progress in implementing EMS over the last few years. Globally, the UK is now ranked fourth amongst countries with the highest number of ISO 14001 certificates. This clearly makes the UK a world leader in the take‐up of this standard.

In Mexico, and at the beginning of each presidential term, the Mexican federal government has the responsibility of presenting a six‐year National Development Plan to the country. The plan defines the sectoral programs for various federal ministries including environment, health, agricultural, transportation, economic affairs etc. These programs frame commitments and are written guides for government action. In the National Development Plan of 1995‐2000 the government established a balance between its two main objectives: maintaining economic growth and reaching sustainable development. For the first time, environmental concerns were given special attention in the government’s national agenda. Within the plan is the Environment Program 1995‐2000, which emphasizes the development of the countryʹs environmental conscience and represents a clear commitment to encourage


policies and instruments that contribute to a transition towards sustainable development.

Furthermore, Mexico possesses what are called the “Green Plans”. The Green Plans are comprehensive and integrated strategies for the deliberate pursuit of sustainable development. Government, business, and NGO sectors are all involved as partners in developing and implementing the plans. Also referred to as strategic environmental management plans, Green Plans apply the business model of “managing for results” to achieve long‐term environmental and economic goals and to secure a high quality of life for present and future generations.

Although Mexico does not have a national clean production plan, Mexico is a member of the UNIDO network of National Cleaner Production Centers. Furthermore, Mexico joined the USA robust program of clean production initiatives, including activities designed to promote energy efficiency and the use of renewable energy

Morocco, on the other hand, although being a developing country, has clearly declared its willingness to pursue Sustainable Development including better environment for two decades. This was translated into concrete action, with the creation of a ministerial department for the environment in 1992 and the implementation of a process that has fully integrated environment protection concerns in the social, political and economic plans.

In 1992, Morocco developed a National Action Plan for the Environment. Created with the support of the United Nations Development Program (UNDP) and the United Nations Fund for Population, the goal of plan is to design tangible, concrete actions that reflect the objectives stated in Morocco’s national environmental strategy and ensure their continuing development. Over 165 specific actions are recommended in the plan, which is structured around seven broad priorities that reflect Morocco’s environmental objectives

• Protection and sustainable management of water resources;

• Protection and sustainable management of soil resources;

• Air protection and promotion of renewable energies;

• Protection and sustainable management of natural surroundings;

• Prevention of natural disasters and major technological risks;

• Improving urban and urban‐related areas; and

• Environmental management and communication

Today, Morocco has a better understanding of the environmental problems. A national environment strategy has been developed and well‐founded environmental regulations exist. However, Morocco is still facing challenging environmental


problems, some of which would require appropriate solutions, in order to achieve the national strategy and assure the population of a healthy and acceptable life.

2.8.3. Recommendations 2.8.3.1. Translate NEAP into detailed action plans

As mentioned earlier, the NEAP is a framework that represents Egypt’s environmental agenda for the coming 15 years. Nevertheless, it is recommended that this framework be translated into detailed action plans that would cover the following issues:

• Enforcement and implementation of the Clean Production program

• Protection and Management of National Resources

• Promotion for implementing Environmental Management Systems

2.8.4. Recommendations Summary Table 19 summarizes the recommendations listed in this subsection as well as their scope, level and laws affected.

No.

Scope

Level


16 0 0 Translate NEAP into detailed action plans

None

Table 19 – Recommendations on Future Directions and Planning

Study on Environment as an Aspect of M/SME Policy Development in Egypt Action Plan - Page 61

3. Action Plan

3.1. Column Headers: Recommendation Narration of the recommended action Affected Laws These are the legal statutes that would be affected by the

recommendation and therefore would need to be modified, repealed on added.

Owner The entity that owns the action and is responsible for coordinating with different authorities to manage its implementation

Actors these are the different authorities participating in implementation of the recommendation, whether by: • Approval; • Actual implementation of the recommendation or of a

part thereof; or • Providing consultation on how to implement the

recommendation If the cell contains the sign “__” then it means that the owner is the sole actor for this recommendation.

Impact/Justification to include the expected impact or to justify the recommendation

Term When defining the term for implementing the recommendation, the following should be considered: • Define Short term for recommendations that do not need

modifications in laws or restructuring departments or authorities

• Define Medium term for recommendations that need modifications in laws or restructuring on the level of departments

• Define Long term for recommendations that need modifications in laws or restructuring on the level of authorities


3.2. Implementation Action Plan Recommendations included in the study report for “Environment as an Aspect of M/SME Policy Development in Egypt”

Recommendation

Affected Laws

Owner Actors Term Impact/Justification

1. Assign a single authority to be responsible for regulations with “Vito” rights

4/1994 EEAA38 The Prime Minister, MSEA39

Short Ensure that the EEAA is the sole entity responsible for regulations related to or affecting the environment

2. Translate the National Environment Action Plan into published detailed plans

None EEAA EEAA/ Outsourcing

Short Increase the credibility of the government in general and the EEAA in particular

3. Assign the role of environmental inspection to a single authority


EEAA Prime Minister, MSEA, MHP40, MIWR41, MoA42, MoEE 43and MoI44.

Medium Enhance the credibility of EEAA, eliminate redundancy in inspection activities

4. Ensure that the enterprise receives a copy of the inspection report

None EEAA EEAA Inspectors Short Increase transparency and credibility of EEAA

5. Ensure that penalties stipulated by the new amendments to the environmental law are proportional to the magnitude of the environmental infringements

None EEAA EEAA Short Eliminate the chance of having negative impacts on the formal industrial sector

38 Egyptian Environmental Affairs Agency 39 Ministry of State for Environmental Affairs 40 Ministry of Health and Population 41 Ministry of Irrigation and Water Resources 42 Ministry of Agriculture 43 Ministry of Electricity and Energy 44 Ministry of Interior


Recommendation

Affected Laws


6. Increase the number of qualified environmental inspectors

None EEAA MSEA, EEAA Medium Boosting the human capacity of EEAA and enable it to enforce the environmental law

7. Develop and publish Enterprises Environmental Compliance Index

None EEAA EEAA, Outsourcing Medium Increase transparency of the inspection procedure and provide a moral incentive to M/SMEs to comply with environmental requirements

8. Publish inspection reports through the EEAA website

None EEAA EEAA Short Increase transparency of the inspection procedure

9. Conduct awareness seminars directed to M/SMEs

None EEAA EEAA, NGOs, Funding Agencies

Short Increase M/SMEs awareness about different environmental issues and how they would benefit from compliance with the requirements

10. Provide Pre‐Inspection consultation None EEAA EEAA Short Provide M/SMEs with necessary awareness and knowledge of pre‐inspection environmental criteria

11. Develop a structured tax incentive program to support environmentally complying M/SMEs

Ministerial Decree

EEAA Prime Minister, Ministry of Finance

Medium Provide a powerful incentive for M/SMEs to be compliant and compensate them for efforts and costs of compliance

12. Assign a focal point for coordinating donor programs


EEAA Prime Minister Short Harmonize different donor programs according to Egypt’s national plans and priorities

13. EEAA to orchestrate technical assistance programs directed to MSEs

None EEAA EEAA, NGOs, Funding Agencies

Short To leverage M/SMEs into enterprises that apply good environmental practices in production and waste management


Recommendation

Affected Laws


14. EEAA to establish closer presence for M/SMEs

None EEAA EEAA, NGOs Medium Maximize the benefits that M/SMEs could gain from different initiatives

15. Encourage entrepreneurs to enter the field of recycling industries

None EEAA EEAA, NGOs Short Create new jobs, enhance the economy and solve the problem of waste

16. Translate NEAP into detailed action plans

None EEAA EEAA Medium Transform the environmental agenda into actual detailed plans to cover the short, medium and long terms and achieve sustainable improvement in managing environmental affairs

Study on Environment as an Aspect of M/SME Policy Development in Egypt Bibliography - Page 65

4. Bibliography

4.1. Glossary 4.1.1. Environmental Management System (EMS) Environmental Management System is a tool used by a company to identify, to measure and to manage the effects of its activities on the environment. An EMS sets out the company’s goals for environmental performance and a plan for achieving those goals. Ideally, company managers will set goals in areas such as compliance with environmental laws, minimization of risks to human health and the environment, use of natural resources, and prevention and reduction of pollution.

4.1.2. EMS Models Today, EMSs can range in complexity from simple reminders of regulatory deadlines at a single facility to an elaborate, Internet‐based, enterprise‐ wide performance management system that tracks regulatory requirements, assigns tasks, controls documentation and records, provides training, and shares information across multiple operations and facilities around the world. EMSs are most effective when they are part of normal business activities rather than treated as separate programs or initiatives. Although businesses typically have many elements of an EMS already in place, the EMS provides a systematic way to integrate those efforts and direct them toward company‐established goals. The significant range and variations of EMSs can be attributed to the differences among organizations in size, activities, impacts, regulatory requirements, corporate culture and policy commitments.

4.1.3. Micro/Small and Medium Enterprises (M/SMEs) • Definition of the MSMEs according to the “The Law on Development of Small

Enterprises”, Section I: Definitions

Article I:

In the context of application of the provisions hereof, by a small enterprise shall be meant every company or sole proprietorship practicing an economic activity, whether productive, service‐rendering or commercial in which the paid‐up capital shall not be less than fifty thousand pounds and shall not exceed one million pounds and in which the number of employees shall not be more than fifty employees.

Article II:

In the context of application of the provisions hereof, by a very small enterprise shall be meant every company or sole partnership practicing an economic activity, whether productive, service‐rendering or commercial whose paid‐up capital shall be less than fifty thousand pounds.


• The Definition of Micro, Small and Medium Enterprises published by SMEPoL, January 200445:

Enterprise Type Ceiling for the Range

Labor Fixed Assets (LE)

Annual Revenue (LE)

Manufacturing and Construction

Micro 1‐4 25,000 100,000

Small 5‐49 5,000,000 10,000,000

Medium 50‐99 10,000,000 20,000,000

Services and Trade

Micro 1‐4 25,000 100,000

Small 5‐9 500,000 1,000,000

Medium 10‐19 2,000,000 4,000,000

• M/SME Definitions used by Other Organizations in Egypt46

Ministry of Industry 10 – 100 workers 0 – 500 000 EGP Fixed Assets

Ministry of Planning 0 ‐ 50,000 in fixed assets including land and buildings

Ministry of Rural Development

Definition does not use economic criteria.

Institute for National Planning 10 ‐ 49 workers Central Agency for Public Mobilization and Statistics

50 – 100 workers

Industrial Development Bank

Uses value of fixed assets, adjusted periodically

Credit Guarantees Corporation (CGC)

EGP 40,000 ‐ EGP 7 million of Assets (exclud‐ing & land buildings); 1 ‐ 5 resp. 6 workers

USAID: For National Bank For Development (NBD)

0‐ 15 workers 0‐ 25,000 Fixed Assets

For Business Associations Micro: (1‐5) Employees Small: (6‐15) employees

45 http://www.sme.gov.eg/English_publications/Definition.pdf 46 http://www.sme.gov.eg/English_publications/MSME_Profile_2005.pdf


4.1.4. Cleaner Production (CP ) Cleaner Production is the continuous application of an integrated preventive environmental strategy to processes, products, and services to increase overall efficiency, and reduce risks to humans and the environment. Cleaner Production can be applied to the processes used in any industry, to products themselves and to various services provided in society.

For production processes, Cleaner Production results from one or a combination of conserving raw materials, water and energy; eliminating toxic and dangerous raw materials; and reducing the quantity and toxicity of all emissions and wastes at source during the production process.

For products, Cleaner Production aims to reduce the environmental, health and safety impacts of products over their entire life cycles, from raw materials extraction, through manufacturing and use, to the ʹultimateʹ disposal of the product.

For services, Cleaner Production implies incorporating environmental concerns into designing and delivering services.

4.1.5. Environmental Kuznets Curve (EKC) The Environmental Kuznets Curve (EKC) model posits between economic development and environmental quality. It adopts the notion that that developing countries should “grow first and clean up later.”

According to the model, in the first stage of industrialization, pollution grows rapidly because people are far more interested in jobs and income than clean air and water, communities are too poor to pay for abatement, and environmental regulation is correspondingly weak. The balance shifts as income rises. Leading industrial sectors become cleaner, people value the environment more highly, and regulatory institutions become more effective. Along the curve, pollution levels off in the middle‐income range and then falls toward pre‐industrial levels in wealthy societies


4.2. References 1. “2005 Environmental Sustainability Index Report”, by: Yale Center for

Environmental Law and Policy Yale University & Center for International Earth Science Information Network, Columbia University

2. “A research sought to explore small firm responses to growing environmental pressures from markets and state regulations as a part of a report conduced for a project titled “UK Small Firms and Their Response to Environmental Issues” and under a program called “Environment and Human Behavior” during 31.12.2003

3. “Air Pollution During Growth: Accounting for Governance and Vulnerability” by the World Bank, August, 2004.

4. “Environmental Standards and Competitiveness of Key Economic Sectors” By United Nation, 2005.

5. “International Business Ethics: Mexico, Law, Adjudication, and Enforcement” by, Joseph M. Kates, Graduate School of Business ,University of Pittsburgh .

6. “Profile of M/SMEs in Egypt, Update Report, by Ministry of Finance 7. “SME‐Environment 2003”, A survey to assess environmental behaviors among

smaller UK businesses by NetRegs, 8. “Successful Practices of Environmental Management Systems in Small and

Medium‐Size Enterprises” by Commission for Environmental Cooperation, December 2005

9. “UK Law and the Environment” by John Hartshorne, 47Naturenet web site. 10. “UK SMEs and their Response to Environmental issues”, by Small Business

Research Centre, Kingston University, March 2004. 11. 2005‐2007 Plan of Action Pursuant to the U.S.‐Morocco Joint Statement on

Environmental Cooperation. 12. A Study on the European commission‐ Environment web site. 48 13. Doing Business in Canada, Osler, Hoskin & Harcourt llp, June 2006. 14. Environment Canada, Environmental Protection Branch, office of Enforcement,

49web site 15. Environmental Protection Act 1990 (c. 43), 1990 c. 43 16. NEETF 2001. 17. Recommendations for International Network for Environmental Compliance and

Enforcement (INECE), 11 April 2005. 18. Report “No. 18071‐ME, Mexico, the Guadalajara Environmental, Management

Pilot” 19. The speech of Minister Mohamed El Yazghi, Ministry of Territory Planning,

Water, and the Environment, during the International Network for Environmental Compliance and Enforcement (INECE), 11 April 2005

47 http://www.naturenet.net/index.php 48 http://ec.europa.eu/environment/sme/pdf/smestudconc.pdf 49 http://www.atl.ec.gc.ca/enforcement/index.html


20. UNEP web site: http://www.unep.org/ 21. http://strategis.ic.gc.ca/epic/site/csr‐rse.nsf/en/rs00128e.html 22. http://www.ec.gc.ca/emsinfo/home_e.htm 23. http://www.ec.gc.ca/sd‐dd_consult/PDF/SDSfinal_e.pdf 24. http://www.ec.gc.ca/sd‐dd_consult/SDS2007/c3_e.htm#g1 25. COMPLIANCE PROMOTION IN THE UNITED KINGDOM, LEINSTER, GRAY,

HOWES, CLARK 26. http://www.csr.gov.uk/whatiscsr.shtml 27. http://www.environment‐agency.gov.uk/regions/wales/163950/487702/ 28. http://greenplans.rri.org/resources/greenplanningarchives/mexico/management1.

html#1 29. FINAL ENVIRONMENTAL REVIEW OF THE UNITED STATES ‐ MOROCCO

FREE TRADE AGREEMENT, July 2004 30. Environmental policy in Morocco: Institutional problems and the role of non‐

governmental organizations by Eva Weidnitzer, German Development Institute, Berlin

31. “Exchanging experience between developing and developed countries “, United Nations Environment Program, UNEP Chemicals

32. “Incomplete Enforcement of Pollution Regulation: Bargaining Power of Chinese Factories” by Development Research Group, World Bank, 1818 H Street NW, Washington, D.C. 20433, U.S.A. and University of the West Indies, Cave Hill Campus, Bridgetown, Barbados, January 2002.

33. “Disclosure of Environmental Violations and the Stock Market in the Republic of Korea” World Bank Policy Research Working Paper 3344, June 2004

34. “A financial industry benchmark for determining, assessing and managing social & environmental risk in project financing” July 2006: www.equator‐principles.com

35. “Formal And Informal Regulation of Industrial Pollution: Comparative Evidence from Indonesia and the US”, by Sheoli Pargal, The World Bank.

36. Environmental Performance Rating and Disclosure: China’s Green‐Watch Program, World Bank Policy Research Working Paper 2889, September 2002

37. INDUSTRIAL POLLUTION IN ECONOMIC DEVELOPMENT: KUZNETS REVISITED, Development Research Group World Bank, December, 1997

38. Industrial Ownership and Environmental Performance: Evidence from China, Development Research Group World Bank, December, 2002

39. European Funding support for Regional development with Addendum for Acceding Countries by Richard Warren – Steppingstones for for projects Beep (Best eEurope Practices) and Prisma (Providing Innovative Service Models and Assessment), February 2004

40. Country Analysis Briefs: Egypt Environmental Issues, August 2003‐ www.eia.doe.gov

41. Manual for Implementing EMS in SME: www.ifc.org/ifcext/enviro.nsf/content/EMS


42. GUIDANCE ON CHEMICALS LEGISLATION: OVERVIEW, Final Draft, United Nations Environment Programme, Environmental Law and Institutions, Programme Activity Center, International Register of Potentially, Toxic Chemicals

43. “ENHANCING COMPETITIVENESS FOR SMES IN EGYPT”: General Framework and Action Plan, Ministry of Finance, November, 2004

44. Country Profile of Environment Egypt, Planning and Evaluation Department, Japan International Cooperation Agency, February 2002.

45. “DAIRY SECTOR REPORT, EGYPT”, Produced by Dr. Osman Abdel Aleem Aita for the SEAM Program, September 2004.

46. Challenges in cleaner production policy in Egypt ,Dr. Raymo Lilja, EPAP 47. FROM ENVIRONMENTAL FROM EGYPT, GENENA, TAREK M. Technical

Cooperation Office for the Environment, Egyptian Environmental Affairs Agency and National Coordinator for the National Environmental Action Plan,

48. “Pollution Prevention Practices Pollution Prevention Practices in Small and Medium in Small and Medium‐sized sized , Metal Finishers Metal Finishers, By Meena Hassanali Meena Hassanali‐Bourdeau, York University Bourdeau, York University, April 2004

49. “Proposed Economic Tools for Environmental Sustainability in the Middle East and North Africa” By Dr. Sherif Arif, Regional Environmental Advisor, Middle East and North Africa Region, The World Bank, Egypt‐ Environment, The Gateway for Profitable Environmental Compliance” 2003.

50. Climate Change Initiative (CCI) Final Report, April 2005 51. “The obstacles and opportunities related to implementation of management

system standards (including ISO 9001 and ISO 14001) in Canadian Small Business”, A Report for Industry Canada Prepared by E2 Management Corporation, 2006.

52. ʺOutline of a National Strategy For Cleaner Production: The Case of Egyptʺ, A paper presented at CP7, organized by The Czech Government, UNEP and UNIDO, Prague, 28 – 29 April 2002

53. ʺA Guide for Cleaner Production Opportunity Assessments in Small and Medium Enterprisesʺ SEAM Program, September 2004.

54. ʺPilot 2006 Environmental performance Indexʺ, Yale Center for Environmental Law & Policy Yale University, January 2006.

55. ʺGovernment position statement on Environmental Management Systems, September 2005, Environment Strategy Directorate Environment, Business and Consumers Division. DEFRA

Study on Environment as an Aspect of M/SME Policy Development in Egypt Annexes - Page 71

5. Annexes

5.1. Annex A: Outcomes of the Field Survey Number of interviewed sample: 66 Gender Male Female 84.8% 15.2% Enterprise size (number of employees) 5-15 16-30 31-50 51-70 71-99 4.5% 6.1% 27.3% 12.1% 50.0% Sector Textile Food Chemicals Others 19.7% 21.2% 15.2% 43.9% 100.0%

Awareness level 0% 1%-20% 21%-40% 41%-60% 61%-80%

81%-100%

3.0% 28.8% 34.8% 18.2% 12.1% 3.0% Environment basic elements 63.6% Laws and regulations 72.7% Concerned organizations 97.0% Waste management systems 83.3% Clean Production 48.5% Participating in Environmental Activities Yes No 27.3% 72.7% Ability to apply programs for compliance High Medium Low 47.0% 37.9% 15.2% Adopting good environmental practices Yes No 59.1% 40.9% Reasons for not adopting good environmental practices

Financial Technical Social Business

34.8% 1.5% 13.6% 6.1%


5.2. Annex B: Field Survey Questionnaire A Survey for SMEs: Awareness of Environmental Compliance -2007

Name: ------------------------------------------------------------- (Optional) Gender: Male Female Age: ------------------------- Position: Owner--- Manager--- Employee--- Enterprise Activity: ------------------------- No. of Employees: --------------- Male Percentage---% Female Percentage---% Governorate: -------------------------


A Survey for SMEs. Awareness of Environmental Compliance -2007

1- How can you describe environment?

a. Air b. Water c. Earth d. Nature Reserves

2- Do you have information about the Environment Law?

Yes--- No---

3- Who is responsible for environmental issues at you organization? (Owner- Technical Manager- No one- etc.) ----------------------

4- Do you know what are the operating Environmental Authorities?

(50EEAA- Ministry of Health- Ministry of Interior- Ministry or Irrigation-etc.) --------------------------- ------------------------------- --------------------------- ------------------------------- --------------------------- ------------------------------- --------------------------- -------------------------------

5- Have you dealt with any of these organizations during your enterprise establishment or

operation? Yes--- No---

6- If yes, please specify the name and reason for dealing with the organization? --------------------------- -------------------------------

--------------------------- ------------------------------- --------------------------- -------------------------------

7- Does any of these organizations monitor your enterprise?

Yes--- No--- If yes, please specify the name of the organization

--------------------------- ------------------------------- --------------------------- -------------------------------

8- Do you know the proper methods of Wastes Handling ?

Yes--- No---

9- Do you apply any of these methods ? Yes--- No---

If yes, please specify reasons behind applying it:

Abiding by governmental regulations. Making use of a certain grant or service (Please specify).

50 Egyptian Environmental Affairs Agency


These methods are profitable Other reasons (Please specify)---------------------------------

10- If the answer is No, what is the reason behind not applying the proper methods of Wastes Handling?

a. Costs with no return. b. Too complicated procedures. c. Employees are not familiar with them. d. Efforts with no return. e. Have no idea about these methods.

11- Do you think there is a link between a cleaner environment and productivity improvement? Yes--- No---

------------------------------------------- -------------------------------------------

12- Do you think Egypt is suffering from an environmental problem?

Yes--- No--- If yes, do you think your enterprise is contributing to this problem? Yes--- No---

--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

--------------

13- Do you think environment is the responsibility of? a. Every citizen b. EEAA c. Local Authorities d. Others (Please specify)

14- Do you have any idea about the Cleaner Production Programs? Yes--- No---

15- Do you know any of the Clean Production Methods? Yes--- No--- I don't Know---

16- What are the types of wastes your enterprise produces?

a. Solid b. Gas c. Liquid


17- Do you have any system for Waste Treatment?

Yes--- No--- I don't Know---

18- Have you ever asked for receiving technical assistance in the environmental? compliance area? Yes--- No---

19- Do you believe that environmental compliance has an financial reward?

Yes--- No---

If yes, what are environmental compliance benefits -------------------------------------- -------------------------------------- -------------------------------------- 20- Have you ever participated in an environmental awareness activity?(if yes please

specify) Yes--- No---

-------- ----------- ------------------------ 21- What are your environmental information resources? (Friends, TV, Radio, Newspapers, Federation of Industries, NGOs, governmental organizations, etc.)

---------------------- --------------------- --------------------- ---------------------- --------------------- ---------------------

22- Will you agree to join a free of charge program for environmental compliance?

Yes--- No--- I don't Know--- 23- Will you agree to join a profitable program environmental compliance and pay a cost

share ? Yes--- No--- I don't Know--- If yes, what is the percentage of the cost share you can afford (20%, 30%, 40%)

24- Will you agree to adopt free alternative actions for waste treatment in order to achieve

environmental compliance ? Yes--- No--- I don't Know---

25- Do you know which entity you should address in case you encountered an

environmental problem Yes--- No--- I don't care---


26- Which entity will you address in case you detected an environmental problem related

to wastes weather at your enterprise or at the others? a. Police b. EEAA c. 51IMC d. Media Channels e. NGOs. f. Local Authorities

27- Which entity will you address in case you have an environmental technical problem?

a. Social Security Fund b. EEAA c. IMC d. Media Channels e. NGOs. f. Local Authorities

28- Which of these entities will you address to perform certain procedures like (Issuing a

license, obtaining a grant, inquiring about investment services or opportunities) a. Social Security Fund b. Industrial Development Authority c. 52GAFI d. EEAA e. IMC f. Media Channels g. NGOs. h. Local Authorities

29- Do you have any suggestions to improve environment at work or home

--------------- ------------------ --------------------- ----------------------- -------------------- --------------- ------------------ --------------------- ----------------------- --------------------

--------------- ------------------ --------------------- ----------------------- -------------------- --------------- ------------------ --------------------- ----------------------- -------------------- --------------- ------------------ --------------------- ----------------------- -------------------- --------------- ------------------ --------------------- ----------------------- --------------------

--------------- ------------------ --------------------- ----------------------- -------------------- --------------- ------------------ --------------------- ----------------------- --------------------

Thanks for your valuable contributions,

51 Industrial Modernization Center 52 General Authority for Investment and Free Zones


5.3. Annex C: Canadian Incentive Programs

Program Name Recipient Incentive Type

Purpose Funding Level

Home Energy Efficiency Retrofit Grants

Homeowner Grant Assist home energy efficiency retrofits Up to $3,348

Power Smart™ Home Incentive for New Homes in Manitoba ‐

Residential customers of Manitoba Electric

Certificate Energy efficiency in newly constructed residential homes. Certificate for the value of up to $1000 towards the purchase of a front‐loading clothes washer or a $600 rebate on their Manitoba Hydro electric account

Certificate for the value of up to $1000 or a $600 rebate

Energy Star Consumers of Energy Star products, builders and developers

Multiple types: rebate, account credit, prime‐rate loan, incentives

Adoption of Energy Star, energy efficient products

Varies

Canadian Industry Program for Energy Conservation

Industrial companies

Grant Help industrial companies identify ways to increase energy efficiency, improve production processes and cut costs

Up to 50 percent of the cost of an energy audit, to a maximum of $5,000


Program Name Recipient Incentive

Type Purpose Funding Level

Commercial Building Incentive Program

Owners of new commercial and institutional buildings, retail food stores and arenas

Grant Encourage energy‐efficient design practices. Up to $60,000

Commercial Transportation Energy Efficiency and Fuels Initiative ‐

Owners of Class 6, 7 or 8 diesel‐powered trucks or buses.

Rebate Rebate for the installation of pre‐qualified equipment that provides truck‐cab or bus‐interior heating and/or cooling.

Up to $1,400

Energy Retrofit Assistance (ERA) for Commercial and Institutional Buildings

Commercial businesses and public institutions such as universities, hotels and multi‐unit residential buildings

Rebate Encourage commercial businesses and public institutions to invest in existing buildings.

Varies




Industrial Buildings Incentive Program

Industrial buildings with new designs / Industrial Energy Innovators

Incentive Energy efficiency in the designs of industrial buildings by fostering the integration of industrial building design and process design.

Up to $80,000

Wind Power Production Incentive

Electric utilities, independent power producers and other stakeholders

Financial support of installations

Develop wind energy in Canada

Covers about half of the current estimated cost premium for wind energy in Canada.

Renewable Energy Deployment Initiative

Private sector, federal departments and public institutions

Refund Stimulate the demand for renewable energy systems for water heating, space heating and industrial process heating.

Refund of 25 percent of the purchase and installation costs of a qualifying system, to a maximum refund of $80,000 per installation and a maximum of $250,000 per corporate entity.

Market Incentive Program Energy distributors

Contribution Encourage electricity distributors to experiment with projects to stimulate sales of electricity from Emerging Renewable Energy Sources that have low environmental impact to their residential and small business customers.

Up to 40% of eligible expenditures


Program Name Recipient Incentive Type

Purpose Funding Level

Emerging Technologies Program

Canadian industry

Contribution Identifies technical barriers to increasing the energy efficiency of Canadian industries. Supports industrial R&D.

Up to 50% funding assistance for technical assessments, prototype development and field trials.

Industry Energy Research and Development (IERD) program

Canadian industry

Contribution Supports the development and use of new energy‐efficient processes, products, systems and equipment proposed by industry.

Typically 35 percent of total project costs.

Technology Early Action Measures (TEAM)

Municipal, provincial, or federal programs, small, medium, and large businesses, and international companies or foreign governments.

Contribution Supports projects that are designed to develop technologies that mitigate greenhouse gas (GHG) emissions.

Unspecified




Atlantic Canada Opportunities Agency Business Development Program

Most business sectors are eligible except retail/wholesale, real estate, government services, and services of a personal or social nature. Both commercial and not‐for‐profit applicants are eligible.

Repayable contributions

Program offers access to capital in form of interest‐free, unsecured repayable contributions, focusing on small and medium sized enterprises.

Costs eligible for up to 50%‐75% financing depending on eligibility criteria.

IRAP/Technology Partnership Canada

Innovative small and medium enterprises (SMEs)

Contribution Environmental Technologies component encourages and supports the development and application of innovative technologies that contribute to the achievement of sustainable development, or that have significant environmental benefits. Enabling Technologies component supports the development, application and diffusion of those critical technologies that will have major impact and benefits within and across industry sectors.

Contributions will not normally exceed 33% of total eligible project costs.




IRAP/Technology Partnership Canada

Innovative small and medium enterprises (SMEs)

Contribution Environmental Technologies component encourages and supports the development and application of innovative technologies that contribute to the achievement of sustainable development, or that have significant environmental benefits. Enabling Technologies component supports the development, application and diffusion of those critical technologies that will have major impact and benefits within and across industry sectors.

Contributions will not normally exceed 33% of total eligible project costs


5.4. Annex D: Technical Assistance Programs in Mexico

Program Description Commission for Private Sector Studies in Sustainable Development

Promotes sustainable practices such as eco‐efficiency and social responsibility in Mexico’s industrial sector. Offers workshops and seminars on sustainable development, pollution prevention and environmental management systems.

Mexican Center for Cleaner

Serves as a vehicle for the UN Industrial Development Organization (UNIDO) and Mexican National Polytechnic Institute to implement pollution prevention projects.


5.5. Annex E: Technical Assistance Programs in Canada

Program Description Industry Canada

Operates an eco‐efficiency web site offering tools and best practices. Sponsors, with Natural Resources Canada and the National Research Council, free two‐day workshops for SMEs on eco‐efficiency (which includes EMSs). Involved in the Environmental Supply Chain Management Pilot Project, a voluntary initiative aimed at reducing greenhouse gas emissions from SMEs in the Canadian manufacturing sector.

National Research Council, Industrial Research Assistance Program

Directed at building the capacity of Canadian SMEs. Offers assistance for improving resource efficiency. Produces “Design for Environmentʺ online resources to facilitate the integration of environmental considerations into the product and process designs of SMEs.

Toronto Region Sustainability Program (TRSP)

Provides one‐stop pollution prevention technical assistance for SME manufacturers in the Greater Toronto Area (GTA), and a 50% cost‐share funding incentive. The GTA is Canada’s largest and busiest urban area, and includes a number of diverse manufacturing SMEs that generate smog, greenhouse gases, and toxic releases to the air and sewers, and hazardous wastes.

Business Water Quality Program (BWQP)

Designed to assist SMEs in preventing spills to groundwater, surface water and sewers in the Regional Municipality of Waterloo (Ontario). Grants are provided to local SMEs to cost share facility a review and assessment, and to implement best management practices, including EMSs. This includes an inventory of chemical substances; identifies risk areas and potential for spills; reviews pollution prevention plans;

Business Air Quality Program (BAQP)

A pilot program to reduce criteria air pollutants generated by SME industrial manufacturing operations in Southwest Ontario. The goal is to identify opportunities for SMEs to reduce emissions of key criteria air pollutants (nitrogen oxides, sculpture dioxide, particulate matter and volatile organic compounds), to improve their environmental performance and economic competitiveness.


Program Description Canadian Environmental Technology Advancement Centers (CETACs)

The three (3) CETACs provide business services to Canadian entrepreneurs, start‐up companies and SMEs to support the development, demonstration, verification and deployment of innovative environmental technologies. This is accomplished through the provision of support services such as general business development counseling, market analysis, assistance in raising capital, and technical assistance

Enviroclub, Quebec

Assists SMEs in Quebec by providing access to expertise and financing for pollution prevention projects, including EMSs. Provides workshops and professional consulting services to members for a fee.

Eco‐Efficiency Partnership (EEP), British Columbia

Helps small and medium‐size manufacturing enterprises to find ways to become more competitive, using fewer resources such as energy, water or materials. Is a cost‐sharing arrangement with participating companies, in which EEP provides matching funds to a company to pay for consultants able to recommend process improvements that make financial and practical sense.

Eco‐Efficiency Centre, Nova Scotia

Helps companies to adopt good environmental practices,While improving the efficiency of individual companies, primarily SMEs. Encourages companies to commit to conservation goals and to cooperate and exchange successful experiences. Also provides information on eco‐efficiency, offers training sessions and workshops and contributes to education and research.

Environment Study EN .Jan22-08mof.gov.eg/MOFGallerySource/English/SME/Research_studies/36.pdf ·...

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