This chapter of the Kiev report analyzes the main developments in industrial growth in relation to environmental pressure. The chapter concludes that industry remains an important sector of the economy in Europe and espe-cially in the former Soviet Republics (NIS). Industrial output is growing in whole Europe since the mid 1990s and largely decoupled from the inputs of water and energy and the outputs of several types of pollution. Industry in Central and Eastern Europe (CEE) is still three times more energy-intensive than in Western Europe, while industry in the NIS is still seven times more energy intensive. The main challenge in Western Europe is to ensure better protection of the environment while maintaining a competitive industrial base. In CEE, major investments are needed to raise the environmental performance of industry to the standards required by the accession process. In NIS, the main challenge is to build an appropriate regulatory framework and improve enforcement
* Besides the industry chapter, CE was also responsible for the chapter on transport, briefly reviewed under the publications of the transport division.