INTERNATIONAL POLICY ANALYSIS Ecological Industrial Policy A Strategic Approach for Social Democracy in Germany BENJAMIN MIKFELD October 2011 n With the concept of ecological industrial policy Social Democracy in Germany has put forward a way of reconciling the economic and social interests of an industri­alised country with environmental protection and sustainability. The concept is the result of the Social Democratic Party’s decades of engagement with ecological and energy policy issues. n The concept of ecological industrial policy assumes that»green markets« have sub­stantial growth potential. They will be a major source of future jobs and determine an economy’s international competitiveness. Social Democracy must ensure that it is the political force that engages in close dialogue with industry and the trade unions and thus demonstrates its competence to shape the industrial future. n Government has a wide range of instruments with which it can accelerate and shape the ecological restructuring of industry. These instruments rely heavily on the devel­opment of strategic lead markets for ecological innovation. n Ecological change must be managed in a socially responsible way. Where jobs are lost, alternatives must be created. Fair distribution of the dividends of increasing resource productivity is a key condition of achieving societal consensus on an eco­logical change.