Strategic Moves - Regional Environmental Center for Central and ...

level (ADA, 2008l). The purpose of the revolving fund would be to provide funds
for water supply and wastewater treatment, waste management, the construction of
roads and other infrastructure projects. The environmental fund is expected to become
operational in 2009, pending the adoption of a corresponding law by the Parliament.
The fund will be set up as an independent legal entity, but its overall human
and financial resource endowments remain to be decided. The fund’s activities are
expected to cover all the main environmental sectors, including capital investments
in infrastructure, the promotion of environmental education and research, and the
use of renewable energy sources. Financial resources will be provided by the fund in
the form of grants, subsidies and soft loans. The fund is intended to mediate the use
of resources provided by the government, and possibly by international organisations
and IFIs (REC, PEIP Analytical Reports, 2007–2009).
One of the main domestic sources of financing for environmental protection in
Serbia is the Environmental Protection Fund (EPF). The fund covers the development
and implementation of programmes and projects in the field of environmental
protection, the sustainable use of natural resources, environmental
infrastructure, energy efficiency and renewable energy (ADA, 2008h). In practice,
the EPF mostly finances projects in the waste sector (and some in the air sector),
while water sector projects are funded by the Water Directorate belonging to the
Ministry of Agriculture, Forestry and Water Management (MoAFWM). Since
2006, the EPF has been allocating grants for the preparation of project documentation
in relation to the clean-up, remediation and closure of existing landfills. Since
2007, financing has been allocated for the actual construction of regional landfills.
None of these projects has yet been completed, although significant progress has
been made in the regional landfills in Uzice and Prokuplje: most of the funds have
been secured and the construction is under way.
In 2007, the EPF disbursed a total of EUR 2 million entirely for the waste sector,
directed to the preparation of project documentation for, and the actual construction
of, the first phase of the regional waste landfill in Prokuplje, and to the
upgrading of seven municipal landfills.
In 2008, the EPF disbursed EUR 17.4 million in total, of which EUR 9.4 million
(54 percent) was dedicated to the waste sector; and EUR 0.77 million (13.5
percent) to the air protection sector. In 2009, the EPF secured a total of EUR 15
million, entirely for the waste sector (REC, PEIP Analytical Reports, 2007–2009).
The water sector is financed from the Directorate for Waters.
Fund revenues include charges for nature and resource use; pollution charges;
a proportion of funds from privatisation; funds from multilateral and bilateral programmes,
projects and other activities in the field of environmental protection and
energy efficiency; reinvested income; and contributions, donations and grants.
Fund assets are granted through loans, guarantees, direct grants and interest rate
subsidies on commercial loans (ADA, 2008h). Currently, between 70 and 80 percent
of resources are allocated through grants, although in the future it is planned
to increase the share of loans. In 2006, the amount directed to the EPF from charges
was about 0.02 percent of GDP, thus it is clear that, with the current low revenues
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