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

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C H A P T E R 3
C H A L L E N G E S T O E N V I R O N M E N TA L F I N A N C I N G I N S E E
S T R AT E G I C M O V E S
Financial
High level of investment needed
The investments in water and waste infrastructure that are needed in order to
reach full compliance are extremely high relative to the GDPs of SEE countries. The
EU water and waste acquis introduce high EU standards for inbuilt infrastructure.
Compliance with the EU environmental acquis requires the construction of new
infrastructure such as sanitary landfills, wastewater treatment plants for towns with
fewer than 10,000 inhabitants etc. Even the EU-10 countries experience difficulties
achieving compliance years after joining the EU. Some of them are even facing legal
actions. The situation is even less favourable in SEE, where existing infrastructure has
suffered from years of underinvestment. (For further details see Chapter 2.)
Poor bankability of proposed investments
Related to affordability, in many cases large-scale infrastructure investments
that are needed for compliance with legislative requirements (e.g. the construction
of mechanical WWTPs or sophisticated waste management and disposal sites) are
not attractive investments due to long payback periods and other constraints. This
greatly inhibits the availability of investment capital and also requires more sophisticated
project planning and preparation, which is lacking in the region.
Legal
Low level of transposition of key directives
The full transposition of the investment-heavy directives is an important driver
for environmental infrastructure projects, as it will place a legal burden on national
and local governments to create the conditions and undertake the actions necessary
for investments to take place. The CEE experience has shown that very often the
process is carried out within a short period of time, and that compromises are often
made in terms of quality. (For further details see Chapter 4.)
Strategic framework
The drafting of national and local horizontal and sectoral (water and waste)
strategies also belongs among the “planning” challenges. However, it also has strong
legal implications as strategies set the framework and the direction for subsequent
laws and regulations. Drafting strategies through wide stakeholder dialogue has
the benefit of combining different interests at an early stage and attracting support
for future actions. Significant progress has been made in strategy drafting in SEE
during the last two to three years. The drafting of strategic horizontal and sectoral
documents is very important as it “translates” the vision of the government in a
given sector, creates the institutional framework, and provides the legal technology.
The availability of strategic documents is indispensable for the absorption of funding
from the Instrument for Pre-accession Assistance (IPA). (For further details on
strategic documents see Chapter 5, and on IPA see Chapter 7.)