Conclusion

Central and Eastern Europe's self-interest requires that it spends less resources on energy production and consumption, and more on generating marketable products and services - at reduced costs, including reduced energy costs. Results from the case studies prepared by experts from these countries clearly indicate that it is often cheaper to save energy - and improve productivity at the same time - than to produce more energy. Doing so will also reduce the risk of climatic change by reducing the emission of greenhouse gases, particularly carbon dioxide.

The technological and economic changes that will be necessary in Central and Eastern Europe in order to achieve these goals will be enormous. To illustrate, the nation of Germany is subsidizing the region of the former East Germany - a region of only 16 million inhabitants - with about $90 billion per year. Still, many experts believe that it will take one generation before the former communist East Germany is culturally, economically, politically, and morally integrated into Germany as a whole. What resources will be required in the rest of Central and Eastern Europe, if that region wants to become a first class citizen of Europe? Clearly, no foreign government can play the leading role in such an undertaking. These countries must themselves take charge and lead the way. By the same token, Central and Eastern Europe, at once the most polluting and the most polluted part of the world, cannot expect that allowances be made always to accommodate their exceptional difficulties. These nations cannot disregard standards, environmental or otherwise, that are expected of those in Western Europe.

Reducing energy intensity and carbon dioxide emissions will require concerted effort on the part of these nations. They must implement economic and political reforms; assure non-inflationary growth, and create new forms of ownership of private property.

The end of the Cold War certainly presents a unique opportunity for Central and Eastern Europe and for the CIS to learn how best to create conditions for healthy market economies. Such conditions are necessary for their transition to economic and environmental well-being. Western aid agencies such as the European Bank for Reconstruction and Development, the World Bank, the International Monetary Fund, and bilateral aid organizations can only stimulate the process of reconstruction and restructuring. Their efforts, however important, cannot change the ways of a half billion people. Technology and know-how will be transferred in a lasting way only if Western commercial interests are rooted in the economies of these nations.

The effects of reducing energy intensity in the region will have an immediate impact on the macroeconomic level. Production and consumption patterns of goods and services will change dramatically to reflect the prevailing patterns in Western Europe. This shift will be most immediately apparent in Hungary, the former Czechoslovakia, and Poland, countries with energy and resource constraints similar to those of Western Europe. The role of the industrial sector will gradually decrease in the overall GNP balance, which will require large adjustments in the workforce as services become more important than industry.

In Romania, Bulgaria, and the FSU, these changes will most likely take longer than in Central Europe. The lack of market-economy tradition and the slower pace of economic and political reforms have already put these countries behind Hungary, the former Czechoslovakia, and Poland in the race to become fully-fledged partners in the European economic and political union, and thus delay their transformation into modern industrial nations. If any meaningful acceleration of pace is to take place in the economic transformation of these nations, the European Community must extend market access and economic cooperation to these nations. All of these changes are preconditions for an effective energy efficiency strategy that can reduce carbon emissions in these transitional economies.