1. EC approach towards financing infrastructure projects Dagmar KALJARIKOVÁ Policy Officer for Turkey, Montenegro, REC CEE and NGOs Unit for Enlargement and Neighbouring Countries European Commission – DG Environment PEIP meeting Brussels, 26 November 2007

2. EU Environment Policy – The Challenge
Adoption of EU environment legislation is a major challenge:
Legislative
more than 270 pieces of legislation; 80 Major Directives
Institutional
strengthen administrative structures: ministries, agencies but also implementation and enforcement institutions
improve intra-ministerial co-ordination
environmental management in business needs attention
Financial
High estimates of compliance costs.

3. Financial challenge – how to address it
Key issues to be considered:
Compliance with the environment acquis
Heavy investments Directives (UWWTD, DWD, Landfills, WFD, IPPC, LCP, etc.)
EIA, Habitats and Birds Directives
Strategic planning and prioritisation
Approximation Strategies for Environment
Financing Strategies for Environment
Building capacity
To define strategic documents
To mobilise financial resources (attracting donors, national co-financing)
To absorb financial assistance available (PPFs)

4. ENV Financing Strategies – EC approach
EFS plays a number of important roles:
Defines the projects needed to achieve compliance with specific directives
Overall estimates for investments needed
Cost estimates for specific projects
Considers affordability issues
Nationally
For specific projects (focus on Operation & Maintenance costs)
Proposes a credible time frame for implementation

5. ENV Financing Strategies – EC approach
Preparation of EFS – process:
Identification of key stakeholders
Ministries, Agencies, National Funds, Regional and Local authorities (Ministry of Finance plays crucial role)
Establishment of sectoral working groups
Coordination amongst sectors
Steps in the process
Assessment of the existing situation
Description of requirements and making presumptions (e.g. sensitive waters)
Definition of measures needed and costs hereof
Plan for investments and realistic financing (affordability criteria)
Agreement of all relevant institutions

6. Financial challenge – EC assistance
Priority ENV Investment Programme (PEIP) – support to SEE through CARDS:
Identifying and prioritising investment infrastructure projects in line with EU acquis
Developing a list of priority environmental projects
Assistance in formulating bankable investment project proposals
Facilitating dialogue with IFIs
Facilitating exchange of expertise between SEE countries‘ experts

7. Financial challenge – EC assistance
Further capacity building activities – support through Phare, CARDS, FI for Turkey or TAIEX:
Environmental Heavy-Cost Investment Planning in Turkey – priority environment investments and DSPs
Capacity building of environmental authorities through transfer of best practice and training to support effective use of financial resources (MCP Phare2005) – regional financing strategies in BG, RO & TK, national financing strategy for HR, analysis of affordability criteria
website under development
DABLAS Task Force – a platform for co-operation on financing of water related investments in the region
TAIEX – workshops, study visits and expertise

8. Financial challenge – EC assistance
Instrument for Pre-Accession (IPA):
Component I
Technical assistance available for the preparation of Approximation and Investment strategies for ENV
Capacity building of the relevant institutions
Infrastructure investments in potential CCs
Component II
Cross-Border Cooperation (CBC)
Component III „Regional development“ (available only to CCs)
Investments in the field of transport, ENVIRONMENT (OP ENV) and regional competitiveness
Technical assistance for projects‘ preparation

9. Financial challenge – Involvement of IFIs and MSs
Enhanced cooperation with IFIs – 2006 MoU signed by the Commission (ELARG and ECFIN) and IFIs (EIB, EBRD, IBRD & IFC, Nordic Investment Bank, CoEB, Black Sea Trade and Development Bank)
IFIs Advisory Group established in March 2007 (replacement of Infrastructure Steering Group) in order to
Advisory function on the coordination of investment projects in the region
The scope of work extended beyond regional transport, energy and environment projects to cover sectors such as health, education, social issues, municipalities as well as Public Private Partnership
Operational WGs
Environmental principles signed by major IFIs – May
Enhanced cooperation with MSs:
Consultations with MSs on MIPDs for all countries
REC CEE

10. Thank you
for your attention!