Policies for a Better Environment

Progress in Eastern Europe, Caucasus and Central Asia

Brendan GillespieOECD / EAP TF Secretariat

14th Session of the UNECE Committee on Environmental PolicyGeneva, 19 May 2007

The EECCA Report – An inclusive process

June 2003, Kiev Conference

– EECCA Environment Strategy adopted October 2004, Tbilisi Conference

– Stocktaking Report Feb-June 2005, Consultations with II.OO.s, Countries, NGOs

– EECCA Report to be a collaborative effort May 2006, Kiev Workshop: Country Input

– Report Structure, EAP TF Questionnaire March06-Feb07: Input from II.OO.s November 2006, NGO workshops: NGO Input December 2006, Profiles Workshop: Country Input

The EECCA Report – A simple structure

Introduction [the EECCA context] 6 pg Progress across Objectives 65 pg

- Introduction

- (Current situation)

- Recent progress

- Main barriers

- Ways forward

- Further reading Conclusions/recommendations 4 pg Country Profiles 48 pg

In a still difficult context… Rapid growth, but varying across countries Increasingly a Russian-centric trade bloc FDI in oil&gas sector…only Poverty declining, but still high Governance! Weak institutions, weak policy-

making capacities, endemic corruption Political diversification Security issues high on international and domestic

agendas

…progress is taking place…

Over 200 examples identified

Basic legal and policy frameworks often in place

Noticeable progress on– Enforcement (new

inspectorates) – WSS (tariff setting, private

sector operators)– IWRM (Water Codes,

roadmaps) – Agriculture and Forestry

(nutrient management, IPM, organic farming, certification)

WATER SUPPLY AND SANITATION SCORECARD

0

2

4

6

8

10

12

average tariff covers atleast 100% of

operational costs (excl.capital costs)

the tariff settingmechanism followsinternational good

practice

more that 30% of waterconnections are

metered

at least 5% of thepopulation are served

by utilities underperformance-based

contracts

No

of c

ount

ries

2002 2006

BUDGET OF THE MINISTRY OF THE ENVIRONMENT as % of GDP

0.00

0.05

0.10

0.15

0.20

0.25

0.30

% G

DP

2002 2005

WATER SUPPLY AND SANITATION SCORECARD

0

2

4

6

8

10

12

average tariff covers atleast 100% of

operational costs (excl.capital costs)

the tariff settingmechanism followsinternational good

practice

more that 30% of waterconnections are

metered

at least 5% of thepopulation are served

by utilities underperformance-based

contracts

No

of c

ount

ries

2002 2006

BUDGET OF THE MINISTRY OF THE ENVIRONMENT as % of GDP

0.00

0.05

0.10

0.15

0.20

0.25

0.30

% G

DP

2002 2005

…but (on the surface) has not accelerated.

Implementation gap persists, particularly at sub-national level

Lack of coherent approaches to reform

Less progress on

– Waste management

– Biodiversity (integration)

– Transport

– Energy (efficiency) Examples of regression

– Downsizing in Moldova

– Downgrading in Kyrgyz Rep Groundwork being done,

patience likely to pay off

WATER TARIFFS FOR INDUSTRIAL USESUS cents / m3

104.8 118.3

0

5

10

15

20

25

30

35

40

US

cen

ts

2003 2006

TRANSPORT AND ENVIRONMENT SCORECARD

0

2

4

6

8

10

12

Inter-ministerialworking groups in

place

TransportMinistry staff

receivingenvironmental

training

Last transportstrategy hasundergone

environmentalassessment

Last transportstrategy

incorporatesenvironmental

targets

Transportinvestment

programmesregularly

subjected to EIA

Nr

of

co

un

trie

s

2003 2006

Finance is a cross-cutting barrier…

Environmental protection expenditure remains low

PEE decreasing as % of total government spending

Little incentive for industry to invest in pollution abatement (Air, Water)

New sources of finance (CDM) not exploited

Local financial markets untapped (WSS, Waste)

Donor support declining

REGIONAL COMPARISON OF ENVIRONMENTALLY RELATED ODA/OA, SHARE OF TOTAL ODA/OA

0

5

10

15

20

25

30

Sub SaharaAfrica

Middle East& NorthAfrica

LatinAmerica &Caribbean

East Asia &Oceania

South Asia South EastEurope

EECCA

%

Average 2001-03 Average 2004-05

ENVIRONMENTAL PROTECTION EXPENDITURE PER CAPITA, CONSTANT 2003 USD

Armenia

Azerbaijan

Belarus

Kazakhstan

Kyrgyz R.

Moldova

Russian Fed.

Ukraine

0

10

20

30

40

50

60

2000 2001 2002 2003 2004 2005

co

ns

tan

t 2

00

3 U

SD

…but not always the most important one.

CHALLENGING BUT ACTIONABLE WEAKNESSES-Role of political leaders-Administrations “biased” towards producing laws rather than results-Shortage of “market-related” skills-Role of information in policy development and implementation-Weak horizontal and vertical co-ordination-Low awareness of the general public and economic agents

STRUCTURAL AND POLITICAL CONSTRAINTS-Lack of strong drivers-Poor governance context-Challenge of de-centralising responsibilities in a fiscally-sound way -Competitiveness and social concerns-Decreasing donor support-Top policy-makers’ perception of growth/environment trade-offs

A post-Belgrade Agenda

A clear vision A step-by-step approach to reform A stronger focus on implementation An approach that focuses on providing real incentives to

producers and consumers An improved institutional framework A comprehensive approach to environmental financing A strategic investment in skills A stronger engagement of stakeholders A more supportive international co-operation

framework

And the EECCA Environment Strategy?

A realistic evaluation from EECCA countries – Positives: useful as a framework for guiding action and support as well as for assessing progress)

– Negatives: non-binding character, lack of implementation mechanisms, too many issues)

A positive evaluation from donors– Useful to guide cooperation efforts

– Useful to mobilise funds for cooperation Need for a more differentiated geographic approach (sub-

regional, country-targeted)

but also for EECCA-wide mechanisms – to exchange information and good practice – to facilitate dialogue and co-operation with donors

Thanks