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4.4.1 Concept

Sustainable production means the efficient management of resources at all stages of value chains of goods and services. Sustainable production encourages the development of processes that use fewer resources and generate less waste, including hazardous substances, while yielding environmental benefits and frequent productivity and economic gains. Sustainable production also encourages capturing and reusing or recycling valuable resources, thereby turning waste streams into value streams (Beaton & Perera, 2012; Ekins & Lemaire, 2012).

Two of the central ideas of sustainable production are decoupling and leapfrogging. Decoupling refers to the process of reducing the resource intensity of, and environmental damage relating to, economic activities; in other words, the decoupling of economic growth from environmental degradation. Leapfrogging expresses the fact that societies do not need precisely to imitate each other in their processes of development. They can adopt modern technologies without following the development trajectories undertaken when those technologies were not available (Beaton & Perera, 2012).

Cleaner production and appropriate technology are two key approaches under the umbrella concept of sustainable production. Cleaner production is a worldwide approach for environmental pollution control and prevention in industry. On the one hand, inefficient production methods lead to wasting of resources, economic losses, poor working conditions and environmental pollution. On the other hand, production processes that are more energy efficient, use fewer resources, and re-use waste materials not only reduce environmental impacts but may also reduce economic costs. Pollution prevention therefore can be a more attractive approach for industries than treatment of waste by end-of-pipe measures that add on costs. Cleaner industrial production must be concerned not only with reducing levels of toxic and hazardous waste emissions but also

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with life cycle analysis, including the whole production and consumption process to achieve more efficient use of resources (OECD, 1995).

Cleaner production measures have proved to be particularly attractive for SMEs in developing countries (OECD, 1995). Several studies, mainly in Asia, have been already done on cleaner production as industrial restructuring strategy of SMEs (Evans & Hamner, 2003; Sonnenfeld, 2000). However, SMEs are constrained in implementing cleaner production by various attitudinal, organizational, technical and economic barriers (Frijns & Van Vliet, 1999). Although cleaner production offers opportunities for ‘win-win solutions’, where environmental improvements go hand-in-hand with economic benefits, its implementation often remains difficult and will not happen overnight. Cleaner production is not simply a matter of applying new technologies but requires readjustment and rethinking throughout the company (Christie, Rolfe & Legard, 1995). So, cooperation, involvement and commitment of management and employees are essential to implement cleaner production methods (Zwetsloot & Geyer, 1996). Despite the potential saving in costs, cleaner production is restrained by financial obstacles, for instance, low prices for raw materials, low waste disposal charges, and lack of funding. Successful introduction of cleaner production methods for environmental improvements require better coordination of policy efforts and organization of small scale enterprises (Frijns & Van Vliet, 1999).

The approach of appropriate technology refers to environmentally sound technology that puts an emphasis on small scale solutions, use of intensive labor, efficient use of locally available energy and local control (Schumacher, 1983). Therefore, sustainable production not only focuses on eco-efficiency and the transfer of modern large scale technologies but also on saving energy and resources based on the adjustment of technology to the local context (NCAT website, 2011; Practical Action website, 2011). Appropriate technology is equivalent to intermediate technology. Appropriate technology might be the result of the improvement of a traditional technology, the adaptation of an advanced technology to local conditions or the development of a new ‘tailor made’ technology. Appropriate technology is intended to tackle the need of technology of poor people in rural and urban areas based on a regional focus and on decentralization. The typical sectors of application of appropriate technology are building materials, garment, farming tools, post harvesting methods and basic industrial transformation of agricultural products (Schumacher, 1983).

4.4.2 Developments and trends

The evolution of sustainable production is related to a number of developments. The 1992 United Nations Conference on Environment and Development in Rio de Janeiro (the Earth Summit) is the early landmark for many efforts to promote sustainable production at the regional and national levels. Agenda 21, the action plan for sustainable development adopted at the summit, called for action to promote patterns of consumption and production that reduce environmental stress and will meet the basic needs of humanity (Beaton & Perera, 2012). In 1993, the government of Norway at the United Nations Conference on Trade and Development (UNCTAD) organized a workshop on the transfer and development of environmental sound technologies. In the same year, the government of Colombia and the United States sponsored preparatory meetings on technology transfer, cooperation and local capacities. In April 1994 the Agenda 21 process called

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for the transfer of environmentally sound technology, cooperation and capacity building (OECD, 1995). In 1995 the OECD held a workshop for development assistance and technology cooperation for cleaner industrial production in developing countries (OECD, 1995). The main landmark in the promotion of cleaner production is the launching of the National Cleaner Production Centres (NCPCs) programme in 1995 by the United Nations Industrial Development Organization (UNIDO) and the United Nations Environment Programme (UNEP) (UNEP website, 2011; UNIDO website, 2011). In 2002 at the Johannesburg World Summit on Sustainable Development (WSSD) a 10-Year Framework Programme on Sustainable Consumption and Production (10YFP) was approved to promote the shift to sustainable production and consumption. 10YFP was followed by the Marrakech Process, which developed various mechanisms, including regional consultations, Task Forces, and dialogues with different stakeholders, in order both to refine the concept of sustainable production and to show how it could be made operational in very different countries, economic sectors and cultural contexts (Beaton & Perera, 2012).

Compared to cleaner production, the attention to appropriate technology has declined over the last two decades. For instance, two of the main organizations promoting it, the German Appropriate Technology Exchange (GATE) and the Holland’s Technology Transfer for Development (TOOL), are no longer in operation. However, Intermediate Technology Development Group (ITDG), the organization founded by Fritz Schumacher in 1969, is still in operation and in the last years appropriate technology seems to re-emerge again. This re-emergence has to do with the rise of the open source appropriate technology (OSAT) such as Apropedia. This new wave of appropriate technology has benefited from the opportunities now offered by the Internet. OSAT refers to technologies that provide for sustainable development while being designed in the same fashion as free and open source software. According to Pearce (2012), OSAT is made up of technologies that are easily and economically utilized from readily available resources by local communities to meet their needs and must meet the boundary conditions set by environmental, cultural, economic, and educational resource constraints of the local community.

4.4.3 Agents

Agents promoting sustainable production intervene at global, regional and national level. Key global agents of cleaner production are the United Nations Environment programme (UNEP), the United Nations Industrial Development Organization (UNIDO), the World Bank, the Inter- American Development Bank (IDB), the Global Environment Facility (GEF) and the Swiss State Secretariat for Economic Affairs (SECO). They play key roles in establishing policies in developing countries to support cleaner production diffusion, making pollution prevention an integral part of their technical assistance activities, enhancing the capacity development to manage technological change and facilitating access to information and the technological innovation, diffusion and implementation (OECD, 1995). UNEP is an international organization that coordinates United Nations environmental activities and assists developing countries in implementing environmentally sound policies and practices. UNIDO is the specialized agency of the United Nations that promotes industrial development for poverty reduction, inclusive globalization and environmental sustainability. UNEP and UNIDO have worked on promoting cleaner production in SMEs for several years but since 2011 they are working together to further

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cleaner production under the umbrella of sustainable consumption and production (UNEP website, 2011; UNIDO website, 2011)

The World Bank is an international financing institution consisting of five organizations. One of them is the International Finance Corporation (IFC). IFC provides loans and technical assistance to stimulate private sector investment in developing countries. IFC is interested in helping clients to take full advantage of cleaner production techniques by offering advice to optimize facility and process design, identify retrofit opportunities and explore alternative energy and other resource efficiencies. SMEs across a range of sectors and regions are part of their clients (IFC website, 2012; World Bank website, 2011).

IDB is the largest source of development financing for Latin America and the Caribbean. In 1993 IDB established the Multilateral Investment Fund (MIF) to finance small projects that promote innovative development of the private sector and strengthen SMEs. The projects include energy efficiency technologies and practices, and other climate change adaptation strategies (IDB website, 2011; MIF website, 2011).

SECO’s aim regarding international cooperation is to integrate partner countries into the world economy and promote their sustainable economic growth, making an efficient and effective contribution to reducing poverty. In close collaboration with the Swiss Agency for Development and Cooperation (SDC), SECO has been financing the implementation of Cleaner Production Centers (CPCs) in Africa, Asia, and Latin America (SECO website, 2011).

The Global Environment Facility (GEF) is a financial organization integrating 182 member governments established in 1991. GEF provides grants to developing countries and countries with economies in transition for projects related to biodiversity, climate change, international waters, land degradation, the ozone layer, and persistent organic pollutants. GEF is today the largest funder of projects to improve the global environment. GEF works in close collaboration with 10 international agencies, including the UN Development Programme, the UN Environment Programme, the World Bank, the UN Food and Agriculture Organization and the UN Industrial Development Organization. The allocation of grants to implement cleaner production centres in order to improve environmental conditions in SMEs is one of its priorities (GEF website, 2011).

Regarding appropriate technology, the principal worldwide agents are ITDG (now Practical Action) and the International Development Research Center (IDRC). Other key agencies are the National Center for Appropriate Technology (NCAT) in USA and, the Centre for Appropriate Technology (ICAT) in Australia. During the last years new pioneer organizations promoting appropriate technology at global level have emerged, including Appropriate Technology Collaborative (ATC), Catalytic Communities (CatCom), Appropriate Infrastructure Development Group (AIDG), Digital Green, Engineers Without Borders, Kopernik and Village Earth (Pearce, 2012; Zelenika & Pearce, 2011).

Agents operating at a regional level on cleaner production development are the Organization of American States (OAS) and the Spanish Agency of International Cooperation (AECI). The OAS brings together all 35 independent states of the Americas and constitutes the main political, juridical, and social governmental forum in that hemisphere. One of the main tasks of OAS is to formulate and execute technical cooperation projects, including follow-up of the mandates of the Summit of the Americas on Sustainable Development. Projects include the promotion of sustainable technologies to improve the conditions of SMEs in the region (OAS website, 2011).

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AECI works in 50 countries, including Latin America countries. One of its main aims is to promote productive activities by enhancing business capacities, developing markets, connecting SMEs to markets and enhancing innovation and technology. During the last years the support of a network of Centers of Technological Innovation (CITEs) in Latin America has been one of the projects funded by AECI (AECI website, 2011).

At the local level, key agents promoting cleaner production during the last years in Peru are the NGOs CER and IPES, the (inter)governmental agencies ITACAB and CONCYTEC, and the public-private organization CITEs. The main organizations promoting appropriate technology are Practical Action Peru (a local NGO linked to Practical Action UK), the Catholic University’s GRUPO and the National University of Engineering. Local agents are described in more detail in Chapter 7.

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Chapter 5.

Organic production