Statement by Stientje van Veldhoven, State Secretary for Infrastructure and Water Management, for the TDI series ‘Boosting transport decarbonisation investment’,

Speech | 08-06-2021

• Your Excellencies, colleagues, ladies and gentlemen, I’m honoured to speak to you today. And delighted to open this round of introductory statements and discussion panel. 
• There’s so much to be gained from better management of motorisation and trade in used cars. Let me give you some examples. We know that 86 per cent of African cities suffer from poor air quality. And that Africa has the highest rate of road traffic deaths. We also know that in Europe transport-related air pollution costs us between 67 and 80 billion euros in extra healthcare. And that younger, well-maintained vehicles are more energy efficient and less polluting than older, poorly maintained ones. 

• Against this backdrop, it makes sense for us to join forces to improve the management of motorisation and trade in quality used cars. And I would welcome a comprehensive assessment in that respect. But we’ll have to act decisively and smartly if we’re to fully reap the benefits. Let’s look at the various pieces of the puzzle.

• Trade in used vehicles offers leapfrogging opportunities for developing countries. But leapfrogging is only possible if we have the right policies in place to ensure that only good-quality used vehicles are traded. The basic premise is simple. To achieve worldwide benefits, polluting and non-roadworthy vehicles should be taken off the market in high-income countries. But what sense does it make for them to continue causing pollution and making roads unsafe in developing countries?  

• At the same time, better motorisation management and better fuel and air quality standards in developing countries are the springboard to leapfrogging. So we need to take action on:

-     the export of vehicles;    

-     the entry of vehicles into import countries with air quality and fuel standards in mind;
-     the active use of vehicles in those countries;
-     what to do with end-of-life vehicles.

• We believe action is needed on two fronts. First, we need to harmonise the policies of importing and exporting countries and make them coherent. And second, we need to foster technical assistance and investment in developing countries.

• Let me highlight three critical factors: export standards, enforcement and maintenance, and vehicle end-of-life.

• First export standards. Many importing countries are in the process of modernising their vehicle fleets, or want to do so. For instance, the 15 West African countries in ECOWAS have jointly agreed that all imported vehicles must meet at least the Euro 4 emissions standard. I applaud their leadership in this. And I’m very pleased that we’re joined by Robert Lisinge from the UN Economic Commission for Africa, who will tell us more about the vision and leadership of the African nations on this issue.

• It’s now also up to the vehicle exporting countries in the EU, as the world’s biggest exporting hub, to reflect these policies as soon as possible in their own policies on improving the quality of used vehicle exports. I’m firmly in favour of using a valid road-worthiness certificate as a prerequisite for export, as well as considering ways of discouraging or preventing the export of used vehicles that fail to meet the Euro 4 emissions standard. I will use upcoming regulatory reform processes in the EU to try and make that a reality. 

• Second. Enforcement and maintenance. Training vehicle inspectors in countries that have adopted policies to modernise their fleet is key to better enforcement. And to ensuring that exports and imports are in line with the Euro 4 requirements of these countries. If not, the vehicles will get sent back to the country that exported them. 

• Motorisation management and well maintained vehicles are essential in reducing vehicle emissions and improving road safety. We’ll have to find smart financial mechanisms to fund that.

• Lastly, we need to make the private sector part of the solution, involving carmakers and stepping up extended producer responsibility. Under current EU legislation, car producers share responsibility for a high recycling rate of end-of-life vehicles. This is good, but in practice it only applies in Europe. So it doesn’t include the many vehicles exported to low-income countries when they are nearing the end of their life.

• So far, this is a blind spot for EU countries. I think it’s important to make extended producer responsibility more international. This could result in car producers having to assist low- and middle-income countries in setting up systems to collect and recycle end-of-life vehicles. This would also benefit the circular economy and help us with the huge challenge of ensuring that there are enough raw materials and minerals available. As wheels go round, so must materials.    

• To conclude, there are so many benefits that we can achieve if we act decisively and jointly. That is my call on all of you. I would like to present a set of recommendations at COP26 and at the UNEP fifth ministerial meeting on environment at next year’s UNEA-5.2. With political guidance. 

• I hope and trust the TDI series on motorisation management and export of used cars will help us formulate those recommendations. Very much from an investment and innovative finance perspective. It’s the economics and the investments that we need to get right. I hope the TDI series will boost investment and lead to smart business models and finance.

• Thank you.