SKOPJE – Instrument for Pre-accession Assistance (IPA) III offers significant opportunities for green investments in the Western Balkans. As much as 20% of the IPA III will contribute to climate change objectives by 2027 and countries of the region are directing large shares of their IPA III funding to green initiatives. However, they also face organizational challenges to implement them effectively, which need to be addressed.
These were some the main messages of the policy meeting titled “Did EU and its ‘Green’ funding meet the expectations of the WB Countries: Opportunities and challenges for Green Investments”, which was organized by the Institute for good governance and policies in environment and climate change – Skopje (IPECC) on 29 November.
All participants agreed that the successful implementation of green investments relies on several key preconditions – a mature pipeline, which should mitigate delays of insufficiently prepared projects, sufficient administrative capacity at all levels, and effective retention measures to prevent staff turnover and knowledge loss.
Additional needs are strong coordination between local and national authorities on identified priorities, streamlining the approval process for green infrastructure projects, and simplifying administrative procedures.
IPA III: 20% will contribute to climate objectives
In the policy paper presented at the meeting, the IPECC reminds that the EU has contributed to green investments in the region through financial mechanisms like the Western Balkans Investment Framework, IPA III, and the Economic and Investment Plan.
IPA III, in force from 2021 to 2027, is expected to contribute 18% of its overall financial envelope to climate objectives, with the objective to increase this percentage to 20% by 2027.
Under IPA III assistance, green investments for the Western Balkans focus on areas such as renewable energy and energy efficiency projects, sustainable transport, water and waste management, biodiversity preservation, as well as increased resilience to climate change, such as flood protection and sustainable agriculture practices.
Across the Western Balkans, green investments constitute a significant proportion of the total IPA III allocations, according to the IPECC policy paper. Serbia, Albania and Kosovo are leading in terms of the share of their IPA III funding directed toward green initiatives, with Serbia allocating the highest share at 61%, followed by Kosovo at 52%, and Albania at 48%.
However, the fact that these amounts have been programmed does not necessarily mean that they would be implemented, which was one of the challenges addressed at the policy meeting. Apart from Serbia, which has initiated procurement activities for a Regional Waste Facility, and North Macedonia, where a project aimed at clean air was entrusted to the United Nations Office for Project Services (UNOPS), no other countries have yet begun work on the planned green investments financed under IPA III.
“Despite the increasing commitments, implementing actions need to be improved”, said Andrijana Nelkova-Chuchuk, Commissioner at the Energy and Water Services Regulatory Commission of North Macedonia, at the policy meeting.
She added that the green energy transition is expensive and could be successful only with significant support from the EU and other donor funds.
Nicola Bertolini, Head of Cooperation in the EU Delegation in Serbia, stated that the beneficiary countries have to improve governance, capacity and implementation for all needed environmental infrastructure investments.
How can the projects be implemented more efficiently?
According to the IPECC policy paper, IPA III funds will be implemented through a combination of Annual Action Programmes (AAPs) and multiannual Operational Programmes (OPs), with a stronger focus on OPs as a central tool for achieving strategic long-term objectives.
Among the Western Balkan countries, only North Macedonia and Montenegro have prior experience implementing OPs under IPA I and IPA II, and now OPs are also available for Serbia and Albania.
“Good programming through IPA III sets the basis for the further smooth realization of the EU-funded infrastructure projects”, said Brankica Cmiljanovic, Focal point for GAWB and Head of the Directorate for Enhancing the Environment in the Ministry of Ecology of Montenegro.
However, considering that for most countries staff turnover is evident, implementing OPs is expected to have a sharp learning curve, and the proper guidance from the EC is of crucial importance.
This is one of the recommendations suggested by IPECC in its policy paper. The document outlined paths forward aimed to empower the Western Balkan countries to make the most of the opportunities provided by IPA III.
These include reducing staff turnover in IPA bodies, establishing a more robust project review process that could help ensure that only fully mature projects are approved, streamlining regulatory approvals for green infrastructure and creating flexible budget mechanisms due to the volatility in market prices.
Cooperation of multiple stakeholders necessary
IPECC also recommended enhancing coordination and collaboration between local and central institutions in identifying financing priorities.
“A good collaboration between representatives of local authorities which are mayors and presidents of Regions and National Government is utmost importance in order to seen all the projects finished in due time”, said Adrian Teban, Mayor of Cugir City, Alba County in Romania, at the policy meeting.
Evgenija Serafimovska-Kirkovski, Head of NIPAC Office in North Macedonia, emphasised that active involvement of civil society and local self-government in drafting strategies and policies ensures transparency and partnership.
“The success of EU-funded green investments relies on timely project preparation and their maturity, regular update of pipeline of projects, and effective planning to address delays and changing conditions”, she said.
Panellists from EU Member States emphasized the evolution of green initiatives, transitioning from a “smart” to a “circular” approach. This shift places greater emphasis on aligning the benefits of green activities with citizens’ needs, ensuring these initiatives are more tangible and impactful at the community level.
George Kremlis, Member of the Board of Directors at the European Public Law Organisation and Director of the Circular Economy and Climate Institute from Greece said that the circular economy should be mainstreamed through an ambitious projects pipeline.
The meeting was held within the IGNITA Initiative, which is funded by Open Society Foundations—Western Balkans.