Tenth meeting of the EAP Task Force’s
EECCA Environmental Finance Network
Environmental Financing Trends in South
Eastern Europe
Joanna Fiedler
Senior project manager
Environmental financing
Outline
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Introduction to the report, status of work;
SEE region context;
Key messages;
Domestic environmental expenditures;
International flows to environment;
Financial mechanisms in use.
www.rec.org
Introduction to the report
• Category II document for Belgrade Ministerial conference.
• Follow up to the “Environmental financing trends report”
for Kiev conference
http://www.rec.org/REC/Programs/SofiaInitiatives/Enviro.
Finance.in.CEE.pdf
• The main goal of the report is to propose
recommendations for decisions-makers in the region so
that they could take action and ensure more
environmental funding schemes and resources for
environmental actions.
www.rec.org
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Major economic and environmental trends which were influencing the
situation on environmental financing in the SEE between 2001 and
2005;
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Presenting trends in domestic environmental expenditures in the
SEE;
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Analyzing international financing flows to the region including bilateral
and multilateral sources;
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Analyzing established and emerging financing mechanisms in the
region and their development potential in the future;
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Identifying new possible financing mechanisms which could be
developed in the future;
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Providing recommendations to decision makers on improving
effectiveness of environmental financing from both domestic
and external financing sources.
www.rec.org
Trends in bilateral donors commitments
Others 7.7 %
US 7 %
Norway 6.2 %
Germany 39 %
Netherlands 5.7 %
Japan 17.6 %
Source: OECD DAC data base
Austria
Denmark
Germany
Italy
Japan
Netherlands
Norway
Spain
Sweden
United States
Others
Others = Donor countries with less than
3% share of toatal aid
www.rec.org
Source: OECD DAC data base
Recipients of assistance
35
30
25
20
15
10
5
0
Albania
BiH
Croatia
fYROM
UNMIK
Share of Total Bilateral Environm ental Aid per Recipient Countries (in %)
Serbia and
Montenegro
100.00
90.00
80.00
70.00
60.00
50.00
40.00
30.00
20.00
10.00
0.00
Albania
BiH
Croatia
fYROM
Bilateral Environmental Aid per Recipient Countries (usd / capita)
UNMIK
Serbia and
Montenegro
www.rec.org
Preliminary trends in assistance
Source:
OECD DAC
data base
%
2.5
2
1.5
1
0.5
2004
2003
2002
2001
Serbia and
Montenegro
UNMIK
Total Bilateral Environmental Aid per country
in relation to GDP (expressed in %)
(including the Zletovic project)
fYROM
Croatia
BiH
Albania
0
www.rec.org
Importance of different sources of finance
for infrastructure projects over the time
high
importance
public finance
EC
user charges
medium
importance
private sector
IFIs
bilateral donors
low
importance
1
2
3
4
5 from 5 onwards
short term
years
EU accession
medium term
long term
www.rec.org
Key messages
• Environment low on political agenda on central and local
levels
• Decentralisation process not supported by allocation of
fiscal means
• Low level of domestic financial resources for environment
• EU role is increasing, bilateral donors role decreasing,
IFIs – struggling (borrowing legislation)
• Important role of economic instruments
www.rec.org
Key messages
• Potential for innovative financial mechanisms (private
sector, carbon finance etc)
• Presenting environmental projects as contributors to
growth and employment
• Creating favorable conditions for borrowing,
• Important role of capacity building and technical
assistance
• Assistance needed on project preparation
• Need for diversification of sources of finance
www.rec.org
Thank you for your attention
Joanna Fiedler
Senior project manager
Environmental financing and economic instruments
Environmental Policy Programme
Regional Environmental Center for
Central and Eastern Europe
jfiedler@rec.org