Intervention on 'Green Economy - Green Investment Adequacy'
It is a great pleasure to be here today and I would like to express my sincere thanks and congratulations to the Employers and Industrialists Federation, Top Kinisis Travel and the Cyprus Energy Office for the invitation and the whole organisation of the event.
As you all know the transition to a green economy and the achievement of environmental sustainability and climate neutrality is an objective of paramount importance for our country in order to ensure sustainable and long-term growth and to achieve the strengthening of our economy. As a state we are committed to promote the immediate implementation of the objectives of the Green Deal, the EU's new development strategy.
In this context we have already adopted and are implementing policies, investments and reforms that promote the achievement of the green transition. The amount of mainly investment measures to achieve the green transition objectives from the European Funds amounts to around €1.5 billion and includes programmes co-financed by the Cohesion Policy Funds (including the Fair Transition Fund - €784 million), the Recovery and Resilience Fund (RRF - €491 million), the Common Agricultural Policy Fund (around €185 million) and the European Maritime and Fisheries Fund (€52 million). In addition to investments, the Government is also promoting a number of reforms, notably through the Recovery and Resilience Plan , which are necessary for the transition to the new growth model.
More specifically, through the new Cohesion Policy Programme "Thaleia" and the Recovery and Resilience Plan, programmes under the responsibility of the Minister of Finance, investments of €616 million and €491 million respectively are being promoted. First of all, investments are promoted in the energy and climate sectors and the interventions concern the promotion of energy efficiency and greenhouse gas emission reduction measures, the promotion of Renewable Energy Sources (RES), sustainable water management (e.g. sewerage, replacement of water supply networks, smart water meters), enhancing biodiversity (management of Akamas National Forest Park and other NATURA sites), promoting sustainable transport, adapting to climate change and preventing risks from natural disasters and promoting the transition to a circular economy.
In particular, investments of €168 million will be promoted through the Fair Transition Fund,
The actions and policies to meet the climate targets are fully consistent with the National Energy and Climate Plan 2021-2030, which sets out the national programming with targets, measures and policies related to energy security, the internal energy market, energy efficiency, renewable energy and greenhouse gas emission reduction, research, energy efficiency, renewable energy, research and development, energy efficiency and climate change. We must ensure that all the projects that are being rolled out to achieve our current targets are implemented and also promote additional measures to achieve the new targets now being negotiated as part of the 'Fit for 55' package.
To assess the situation on where we are today, an attempt was made to assess the degree of adequacy of the measures approved for funding, both from European resources (EIF, THALIA, Fair Transition Fund, Common Agricultural Policy) and partly from national resources.
Therefore, as DG Development, we have entered into a Memorandum of Understanding with the Cyprus Institute (ICI) to support all government departments involved to ensure that the transition is coordinated and carried out in the most cost-effective and efficient way.
From preliminary assessments, it appears that the planned projects contribute largely to the achievement of the objectives of the National Energy and Climate Plan, but not all objectives. Targets in the energy sector under the existing Emissions Trading Scheme are being over-achieved, but, there is a significant shortfall in sustainable transport under the Responsibility Sharing Regulation, which is the legal responsibility of the State to achieve.
In particular, according to preliminary estimates by academics, additional investments in the two broad sectors of energy and transport need to increase by about 10-20% in the 2021-2030 decade, or by 1-1.5% of GDP per year (about €200-€300 million/year), in order to realize the green transition. Because the cost to consumers of these requirements will be too high and therefore likely to be a major burden on the competitiveness and viability of businesses, the Government, in cooperation with the European Commission, is studying ways in which affected consumers and businesses can be supported through various schemes supporting the whole effort to make the transition as equitable as possible.
The effectiveness of any efforts lies, of course, in The price will be high and the consequences will hit consumers and industries considering the EU's heavy dependence on Russian gas and oil. In addition, it is expected that the implementation of the objectives of the Green Deal will be accelerated in order to achieve the EU's energy independence from imports of fossil fuels from third countries.
Already at the initiative of the EU President, a plan has been proposed to eliminate the EU's dependence on Russian gas before 2030 (REPowerEU) through a more direct shift to renewable energy sources and hydrogen combined with more energy efficiency. The above effort will be beneficial in the long term on an economic and environmental level but in the short term it requires additional investments and drastic economic and social changes.
Therefore, the EU is attempting to give a helping hand against the energy shock through a support package. EU finance ministers have come up with a three-pillar strategy, which includes targeted support for the most directly affected companies (with state guarantees for loans, subsidies) and the promotion of a package of measures to achieve the fastest possible decoupling from Russian fossil fuels.
In parallel, the European Commission adopted a proposal for the Cohesion Action for Refugees in Europe (CARE) which allows Member States and regions to provide emergency support to people fleeing the Russian invasion of Ukraine. The CARE action introduces the necessary flexibility into the Cohesion Policy rules for 2014-2020 to allow for a rapid reallocation of available funding to this emergency support.
Ladies and Gentlemen,
In addition to the above challenges, perhaps the biggest challenge of the last two years is to communicate to the world that this framework of measures and policies is not just about meeting our EU obligation. To convince that climate change is here and that the green transition is both a necessity of the times and an opportunity for our country.
Understanding the problems we will face, and having solutions to them, we must inspire the world that we will pursue the "major" and that we will not just follow our European partners, but will be at the forefront of international energy and environmental developments, with modern policies and measures that will push us all forward and, at the same time, with a genuine concern that in this transition no one will be left behind.
In this context, I am confident that all social and economic partners, in a spirit of solidarity and collectivity, will make every possible effort to achieve our national goal, with a view to building the Cyprus of tomorrow.
Thank you.
(MB/IC)
Contents of this article including associated images are belongs to PIO
Views & opinions expressed are those of the author and/or PIO
Source
