IIP sknowledge Exchange Project on the Industrial Restructuring Experience of Germany s Ruhr Valley
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1 IIP sknowledge Exchange Project on the Industrial Restructuring Experience of Germany s Ruhr Valley Coal Consumption Cap and Energy Transition International Workshop Beijing, China November 18, 2014
2 Project Overview Project Objective: Assist Chinese localities to address impacts of industrial structural change by learning from practical experience in addressing structural change in Germany s Ruhr Valley. IIP is partnering on launch of project implementation with the Wuppertal Institute for Climate, Environment and Energy, located in Wuppertal, Germany adjacent to the Ruhr Valley. The project includes two planned implementation stages.
3 Project Implementation Stages Stage One (ongoing) Literature review (completed) On-site investigation and interviews in the Ruhr by IIP together with Wuppertal Institute (completed) Identification and confirmation of potential key specific topics of operational relevance in China for future in-depth exchange, through discussion with a range of interested Chinese parties (beginning, planned to continue through January 2015) Completion of IIP report, summarizing key relevant experiences of industrial restructuring in the Ruhr and recommending specific areas for future in-depth knowledge exchange (March 2015) Launching of initial exchange of German and Chinese experts for in-depth discussion and review of specific topics (Spring 2015) Completion of design of Stage Two (first half 2015)
4 Project Implementation Stages Stage Two (to be designed before mid 2015) Focus on in-depth exchange between German and Chinese authorities and experts on specific, operationally relevant topics, involving a mix of on-site investigation, in-depth study, reporting and fact-finding dissemination activities Involvement of both national and local entities and experts in China Focus on definition and design of new programs and supporting policies for implementation in China, especially at local levels
5 Where is the Ruhr Valley and what is it famous for? The Ruhr Valley is located in northwestern Germany, where three rivers (the Ruhr, the Emscher, and the Lippe) run into the Rhine River before the Rhine flows to the sea in the Netherlands. The Ruhr Valley is known for: 150 years of industrial development history, based on the region s coal resources and excellent transportation position Navigation through 50 years of major economic structural change involving many projects Definition of the Ruhr s city of Essen as 2010 European Capital of Culture, representing one of many symbols of successful change. Excellent soccer players! The Ruhr Valley in North-Rhine Westphalia (NRW) State, Germany
6 Pressures Mounting in the Ruhr in the 1960s and 1970s Declining competitiveness in the coal industry, and soon after, increasing loss of competitiveness and resulting overcapacity in the Ruhr s iron and steel industry. These shifts in the market dictated that new sources of economic output and employment were required to avoid slipping into massive economic decline. Increasing public intolerance of environmental degradation from mining and coal-based heavy industry: In 1961 future German Chancellor Willy Brandt declared, The sky over the Ruhr must be blue again! This is seen by many as the start of environmentally conscious political thinking in Germany. Recognition develops that the region s severe water pollution problems must be addressed, especially in the Emscher River.
7 Overview of the Ruhr s Radical Economic Structural Change 1. Coal production has fallen from mtin 1960 to 10.9 mtin 2009, with employment falling from 313,000 to only 21,000 miners. The last mine in the Ruhr will close in Once the steel production powerhouse of Western Europe, the Ruhr now produces only 15 mtper year, primarily in high-quality flat steel products. Employment in the steel industry has fallen from 230,000 workers in 1965 to about 48,000 in Industry and construction accounted for 62% of employment in 1961, but only 21% in Growth in jobs in the service sector has taken up most of the employment loss, rising from 38% of employment in 1961 to 78% in Growth in service sector value added and employment includes strong growth in services related to the previous manufacturing base, such as environmental protection technology and logistics, in addition to growth in R&D and the education sector.
8 Some Potential Specific Topics Relevant for China for In-depth Exchange (1) 1.Survival Strategies for Steel Companies in an Economically Challenging Environment. Strategies adopted by the German steel companies include diversification into other business, overseas acquisitions, increasing efficiency and scale economies, and concentration on high-quality specialized products. 2.Legal, Policy, Technology Application and Investment Mechanisms for Clean Up and Re-Development of Degraded Industrial Lands. The provincial and municipal governments have used a variety of successful models to transfer ownership, responsibly clean up, and re-develop land for high-value use in or near to town centers where coal mines, coke ovens, steel production plants or other heavy industrial facilities once operated.
9 Some Potential Specific Topics Relevant for China for In-depth Exchange (2) 3. Lessons in Development of High-Tech and Innovation Centers. Most municipalities in the Ruhr Valley have made efforts to develop new high-tech and innovation centers, seeking to develop new economic output and employment. A few have succeeded well, while many have not, providing practical lessons on some of the challenges with this approach. 4. Blending Bottom-Up Creativity with Top-down Planning for Identification and Implementation of Local Projects. Since the 1980s, local groups have become especially effective in involving local communities and business in developing new ideas for economic and re-development projects, making bottom-up creativity a strength in the Ruhr s development planning. Such participatory, bottom-up approaches are now being used to develop the province of NRW snew low-carbon Climate Protection Plan.
10 Some Potential Specific Topics Relevant for China for In-depth Exchange (3) 5. Dealing with Decline in Coal Mining and Coal Mining Legacies. The Ruhr Valley has become a centerpointof practical knowledge on dealing with declines in mine employment and addressing water and land environmental legacies from underground mining.
11 Next Steps In the coming weeks and months, IIP staff would like to consult with interested Chinese groups concerning what specific topics relating to the Ruhr Valley s experience in structural change would be most worthy for future in-depth knowledge exchange. Interested parties are encouraged to contact IIP s Beijing Office! Chen Dongmei Senior Advisor, Programs Institute for Industrial Productivity CITIC Building, Suite 26A, 19 JianguomenwaiAvenue, Chaoyang District, Beijing, P.R. China ext.101 dongmei.chen@iipnetwork.org
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