by Slavica Dimovska
The brown economy refers to industries, such as mining, metallurgy, machinery, and petrochemicals, which rely heavily on the consumption of fossil fuels and other primary resources. These sectors play a significant role in the economies of the Western Balkans, however they also have a long history of creating serious environmental problems in the form of high carbon emissions, significant pollution, resource depletion and environmental degradation.
In this article, I outline some recent examples of how technological and political advances are trying to address this conflict between economic importance and environmental objectives in order to transform critical industries as part of a shift from the brown to a green – or at least greener – economy.
Importance of the brown economy in the Western Balkans
Whilst the importance of fossil fuel-reliant industrial activity is seen across the whole of the Western Balkans, its precise share varies between countries.
In Serbia, brown industry is significant, accounting for about 26% of GDP, especially in metallurgy and machinery, with 10% of industrial employment. In Bosnia and Herzegovina, brown industry, particularly mining and metallurgy, makes up about 30% of industrial production and employs 15% of the industrial workforce. North Macedonia's brown industry, especially metallurgy, accounts for 22% of GDP and 25% of industrial production. In Montenegro, Albania, and Kosovo, the share of brown industry is somewhat smaller, ranging from 10% to 15% of GDP.
Brown industry has significantly contributed to the economies of these countries for many years, but at the same time, has created serious environmental problems. It is increasingly recognised that, without significant changes, the long-term continuation of these brown economy activities conflicts directly with the needs and objectives of environmental sustainability and public health.
Abandoning a brown economy activity in Montenegro
In some cases, the shift away from the brown economy requires industries to be closed down. One such example of prioritising a healthy environment over a brown economy industry comes from Montenegro where the national government recently terminated a contract for an open mine.
This decision followed a year-long battle by local citizens in Mojkovac, who displayed considerable strength, resilience and environmental awareness. Refusing promises of economic prosperity, they stood firm against potential environmental impacts.
Despite foreign and financial pressures to continue the activity, in May 2024, citizens of Mojkovac emerged victorious in their fight for the prioritisation of environmental safety and residents’ health and well-being over economic interests and the mine was closed. This decision marks a victory for citizens and underscores the government's commitment to transparency and responsibility.
The potential to shift industrial activity from the brown to the green economy
Whilst some industrial activities may need to be abandoned as part of the green transition, the introduction of environmentally sustainable technologies and practices can mitigate some of the negative impacts associated with some traditional industries. Switching to renewable energy sources can reduce dependence on fossil fuels and lower CO2 emissions. Introducing energy-efficient technologies can decrease energy consumption and emissions of harmful substances.
These approaches can not only maintain traditional industries, but can also bring new economic opportunities and create new jobs in green technologies. Here below I outline two examples of how this transition from the brown to a greener economy is being explored in the Western Balkans region.
Transforming a traditional industry in Serbia
In the heart of Serbia, Smederevo Steel Mill was once a symbol of industrial pride, yet it also created significant environmental challenges. When a foreign company took over the factory in 2016, they brought revolutionary changes. They modernised production processes and introduced innovative technologies that not only improved steel manufacturing, but also reduced harmful emissions.
Through recycling waste heat and utilising gas for electricity generation, the plant became more energy-efficient. They also implemented systems for wastewater treatment, reducing the impact on the environment. These changes not only contribute to preserving the planet, but have also created new jobs and boosted the regional economy.
Today, Smederevo Steel Mill serves as an example of how innovation can transform industry, making it greener and thus more sustainable and prosperous for future generations.
Exploring the reopening of a previously brown industrial activity in Montenegro In Pljevlja, Montenegro, an important cement plant was closed down in 1991, after a prolonged period of economic and environmental challenges. This decision was taken despite the plant being renowned for producing high-quality cement and being a source of both pride and employment within the local community.
However, the potential provided by new and emerging ‘greener’ technologies has led to growing interest in recent years to the idea of reopening the cement plant in Pljevlja. Modern technologies and production processes in the new cement plant – including more efficient technologies for filtering waste gases and treating wastewater - could significantly reduce the negative impacts on the environment compared to its predecessor.
Reopening the plant would reduce the economic and environment costs of transporting cement into the region from outside to meet growing local needs. Planned infrastructure development projects in the transportation, tourism, and energy sectors require significant amounts of construction material, including cement. Reopening the cement plant would create a local source of this crucial material, building on the availability of local resources such as limestone, which make Pljevlja an ideal location for cement production.
The primary rationale for reopening the plant is clearly economic in that it would create opportunities to meet local demand as well as exploring export markets, stimulating the local and regional economy and supporting local jobs. But whilst the economic sector would be the same, this time, the colour of the industrial activity would be more green and less brown.
Conclusion
The shift of industrial activity in the Western Balkans from the brown to the green economy is crucial for the long-term survival of these industries. This transition is largely based on new and emerging cleaner technologies and processes, which not only require up-front investment, but also a range of associated skills in green technologies. Ensuring the workforce in the Western Balkans has these skills will be essential for delivering on this green transition.
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