Northern Dimension Environmental Partnership: Successful meeting in Stockholm

As Chair of the NDEP Steering Group, NIB called this first meeting on 12 September 2001. The meeting was held at the City Hall in Stockholm, with support from the Swedish authorities, notably the Ministry of Finance and the City Council of Stockholm. Representatives of EIB, EBRD, WB, NIB, the Nordic Environment Finance Corporation (NEFCO), the EU Commission and the Russian Federation participated in the meeting, which was opened by the Minister of Finance of Sweden, Mr. Bosse Ringholm. At the outset the partnership will primarily focus on environmental projects in Russia to be financed within the NDEP framework.

At its meeting the Steering Group discussed several important environmental projects in the Baltic Sea and Barents Sea Regions. These projects are in the areas of district heating, solid waste management, wastewater treatment and the prevention of pollution from hazardous waste. A list of priority projects will be presented at a pledging conference later this year. The first NDEP project would be the South West Wastewater Treatment Plant in St. Petersburg (SWWWTP), a project that will have a very positive effect on the marine environment of the Baltic Sea, by reducing harmful effluent from the wastewater of St. Petersburg. The SWWWTP has been supported by both Finland and Sweden. Major contributions are also expected from the EU Commission and other donors, including Denmark. Environmental investments in the Kaliningrad region will be subject to particular attention of the NDEP.

Many priority environmental projects involve major investments and are difficult to prepare, structure and implement. They will require the full commitment and support from the local and federal governments concerned. It will take time before they are completed, and before tangible results on levels of pollution can be recorded. The partnership will focus on and accelerate project preparations and funding. The NDEP process will contribute to the progress and successful conclusion of important environmental investments in the transition countries of the Northern Dimension, both nuclear waste and other environmental problems will be addressed.

The background to the meeting is that last March the Nordic Investment Bank (NIB), at the invitation of the Swedish EU Presidency, hosted a meeting in Helsinki with participants from international financial institutions with activities in the Northern Dimension Area (NDA), Sweden, Belgium, Finland and the EU Commission. At the meeting, it was proposed that a Northern Dimension Environmental Partnership (NDEP) be established to strengthen and co-ordinate financing of important environmental projects with cross-border effects in the NDA. A working group was appointed under the chairmanship of the European Bank for Reconstruction and Development (EBRD) and Sweden to propose a framework for such a partnership. At the EU summit in Gothenburg in June, the proposal on NDEP developed by the working group was endorsed.

NDEP consists of two main elements:

• A Steering Group, consisting of a core group of representatives of the European Investment Bank (EIB), EBRD, NIB, the World Bank Group (WB), and EU Commission. Together with representatives of the country (or countries) where NDEP projects are being considered and other participating organisations, the main task of the Steering Group is to prioritise among the most urgent environmental and nuclear clean-up projects in the NDA, and to facilitate the co-ordination and financing of those projects. These projects require the blending of loans and grant financing from a number of different financing sources. The objective is to seek the best possible financing solution for each project, thereby contributing to meet the enormous environmental challenges in the NDA and its cross-boundary impacts.

• A Fund of grants for NDEP projects. The objective of the Fund is to be the mechanism for attracting grant financing from EU Commission and a wider group of contributing countries, in order to efficiently channel additional funds for those environmental projects being prioritised by the NDEP Steering Group. The Fund will be administered by EBRD and governed by a Board of Directors consisting of representatives of the contributors. The Fund will have two windows: one for general environmental projects with cross-border effects on water and air, the other for clean-up projects and nuclear waste management in the region. A meeting between contributors is planned for later this year.