Input Paper „Georgia and Euro­pean Green Deal“

Foto: Shut­ter­stock, artteam

Im Rahmen unseres Pro­jek­tes „Öst­li­che Part­ner­schaft Plus“ ver­öf­fent­li­chen wir eine zweite Reihe von Input Papers zum Thema Per­spek­ti­ven und Prio­ri­tä­ten des  Euro­pean Green Deals (EGD) in der Ukraine, Geor­gien und Moldau. Die Autoren aus der Region (Nata­liya Andru­se­vych, Manana Koch­ladze, Iuliana Can­t­ara­giu) ana­ly­sie­ren die Rolle der Euro­päi­schen Union bei der Unter­stüt­zung der Umset­zung des EGDs und for­mu­lie­ren ihre Hand­lungs­emp­feh­lun­gen an die Ent­schei­dungs­trä­ger in Berlin und Brüssel.

By Manana Koch­ladze, Demo­cra­tiz­a­tion and Human Rights, CEE Bank­watch Network

The Euro­pean Green Deal (EGD) will fun­da­ment­ally change eco­no­mic and poli­ti­cal rela­ti­ons with the EU’s neigh­bour­hood. The Government of Georgia has not made yet any com­mit­ments with regard to the EGD.[1][2] The government’s approach to the country’s eco­no­mic deve­lo­p­ment pri­ma­rily invol­ved exten­sive libe­ra­liz­a­tion and dere­gu­la­tion for decades. This changed only with the signa­ture of the EU-Georgia Asso­cia­tion Agree­ment (AA) in 2014. Since then, Georgia has taken a few posi­tive steps in the envi­ron­men­tal, energy and climate sector, but envi­ron­men­tal pro­tec­tion and climate resi­li­ence are still con­si­de­red to be of secon­dary prio­rity; eco­no­mic growth takes top priority.

The current path of eco­no­mic deve­lo­p­ment and its impact on health and the envi­ron­ment are chal­len­ging. The Global Alli­ance on Health and Pol­lu­tion has repor­ted that at least 140 out of every 100,000 deaths in Georgia are linked to air pol­lu­tion, one of the highest rates in Europe.[3] World Bank esti­ma­tes that the costs of envi­ron­men­tal degra­dation (air pol­lu­tion, lead expo­sure, forests, agri­cul­ture land degra­dation, climate change impacts) were equi­va­lent to 15% of Georgia’s GDP in 2018.

Article 29 of Georgia’s Con­sti­tu­tion requi­res the government to ensure the pro­tec­tion of the envi­ron­men­tal pro­tec­tion and ratio­nal use of natural resour­ces in the inte­rests of current and future genera­ti­ons. The Law on Envi­ron­men­tal Pro­tec­tion pro­vi­des for an envi­ron­men­tal plan­ning system to ensure “con­di­ti­ons appro­priate for the sus­tainable deve­lo­p­ment of the country”. The law requi­res the deve­lo­p­ment of a sus­tainable deve­lo­p­ment stra­tegy for the country. This requi­re­ment has yet to be met, as have those for a five-year natio­nal envi­ron­men­tal action plan and plans and policy docu­ments for indi­vi­dual areas. The social-eco­no­mic deve­lo­p­ment stra­tegy “Georgia 2020” (2014)[4] ack­now­led­ges inef­fi­ci­ent use of natural resour­ces and exten­sive agri­cul­tu­ral pro­duc­tion, com­bi­ned with low tech­no­lo­gi­cal deve­lo­p­ment and inno­va­tion level. In 2015, government adopted the a natio­nal stra­tegy to meet SDGs by 2030.[5]

The Asso­cia­tion Agree­ment between EU and Georgia and the Asso­cia­tion Agendas have fuelled nume­rous posi­tive changes. The first step was enact­ment of a new Envi­ron­men­tal Assess­ment Code in line with the nEIA and SEA direc­ti­ves (2018), addres­sing mul­ti­ple fail­u­res in envi­ron­men­tal decision-making on pro­jects and poli­cies during (2007–2017), and rein­tro­du­cing public par­ti­ci­pa­tion in decision making. Several other laws and policy docu­ments have also been adopted, inclu­ding the Waste Code and Waste Manage­ment Stra­tegy 0216–2030, the Forest Code (2020), envi­ron­men­tal lia­bi­lity legis­la­tion (2021), etc. The Third Natio­nal Envi­ron­men­tal Action Program of Georgia (NEAP‑3) 2017–2021,[6] the key policy docu­ment in this area, was influ­en­ced by the EU-Georgia Asso­cia­tion Agree­ment and United Nations Sus­tainable Deve­lo­p­ment Goals. However, its imple­men­ta­tion is behind sche­dule both with respect to envi­ron­men­tal gover­nance and in key stra­te­gic sectors. This is due to inef­fec­tive gover­nance and insti­tu­tio­nal model, ina­de­quate funding, only 0.4% of the state budget was allo­ca­ted to envi­ron­men­tal pro­tec­tion (around 60 million GEL). This was coupled with con­stant lob­by­ing on behalf of the busi­ness sector to delay or abandon the new envi­ron­men­tal regu­la­ti­ons. For instance, Georgia is behind sche­dule in in desi­gna­ted pro­tec­ted Emerald-network sites[7] under the Council of Europe’s Con­ven­tion on the Con­ser­va­tion of Euro­pean Wild­life and Natural Habi­tats (Bern Con­ven­tion). The country needs to develop a natio­nal freshwa­ter stra­tegy due to abundant hydro­power deve­lo­p­ment plans.[8]

Georgia has been a full member of the Euro­pean Energy Com­mu­nity since 2016. The adop­tion of the Law on Energy and Water Supply in line with the Third Energy Package (2019) was a bre­akthrough for further energy reforms. Rene­wa­ble energy legis­la­tion was adopted in 2019 is in line with the EU’s 2009 rene­wa­bles direc­tive. Legis­la­tion on energy effi­ci­ency adopted in 2020 twill enter into force after 2022. The trans­po­si­tion of the Large Com­bus­tion Plants Direc­tive into Geor­gian law and the pre­pa­ra­tion of the Energy and Climate Action Plan (NECP) have been delayed. As the Clean Energy Package will be inte­gra­ted into the Energy Com­mu­nity Treaty by the end of 2021, the ECT Secre­ta­riat has started to assist with the trans­po­si­tion and imple­men­ta­tion of energy reforms, inclu­ding the Clean Energy Package.[9]

Georgia has no energy sector deve­lo­p­ment stra­tegy or action plan for 2030 aimed at deco­u­pling energy use and eco­no­mic growth. Unsus­tainable electri­city con­sump­tion and the country’s depen­dence on impor­ted fossil fuels (70–75% of primary energy con­sump­tion) are not stres­sed in any stra­tegy docu­ment. Spar­sely avail­able policy docu­ments[10] promote incre­a­sed energy con­sump­tion and the buil­ding of new genera­tion plants, inclu­ding the large hydro­power plants that the vast majo­rity of the public oppose. Mean­while, cryp­to­cur­rency mining, which can be done at next to no cost thanks to low rates charged for electri­city, is nega­tively affec­ting both on the energy balance and on citi­zens’ lives in Abkha­zia and Sva­ne­tia[11]. It is esti­ma­ted that cryp­to­cur­rency accounts for at least 15% of Georgia’s total power load.[12] Accord­ing to USAID, “Current and stra­te­gic decisi­ons of the energy sector are not made on the basis of rele­vant and suf­fi­ci­ent infor­ma­tion ana­ly­sis and rese­arch. There is no proper system and pro­ce­du­res in place for pro­vi­ding expert rese­arch and pro­fes­sio­nal support for decision-making”.[13]

In April 2021, the Government of Georgia appro­ved an updated natio­nally deter­mi­ned con­tri­bu­tion (NDC)[14] under the UNFCCC and an imple­men­ta­tion tool for it. The NDC inclu­des uncon­di­tio­nal (35%) and con­di­tio­nal (50–57%) miti­ga­tion targets for the reduc­tion of GHG emis­si­ons by 2030 com­pa­red to 1990 levels. It defines targets for a number of sectors (trans­port, con­struc­tion, energy genera­tion and trans­mis­sion, agri­cul­ture, indus­try, waste manage­ment and fores­try). The Natio­nal Adap­t­ation action plan will be ela­bo­ra­ted with the support of the Green Climate Fund.

The trans­port sector repres­ents the biggest emitter and was respon­si­ble at least for 24% of GHG emis­si­ons (2015). The updated NDC pre­dicts that emis­si­ons would rise up to 71% under the base­line sce­n­a­rio by 2030, with planned reduc­tion of 15%. The country does not have “a single entity with respon­si­bi­lity for over­ar­ching natio­nal trans­port sector stra­tegy and policy.”[15] This has resul­ted in the allo­ca­tion of a dis­pro­por­tio­nate amount to road infra­st­ruc­ture, with severe impacts on local com­mu­nities, redu­cing their incomes and forcing invol­un­tary resett­le­ment, and on the envi­ron­ment, inclu­ding pro­tec­ted areas.

Despite pro­mi­ses to the con­trary, no green economy policy, green economy stra­tegy 2030 or green economy action plan for 2017–2022[16] were ever adopted. A tech­ni­cal report pre­pa­red for use in the deve­lo­p­ment of a green economy stra­tegy that ana­ly­sed three sectors of economy – con­struc­tion, agri­cul­ture and tourism – pointed out the poten­tial for such a stra­tegy to gene­rate signi­fi­cant savings and addi­tio­nal eco­no­mic and envi­ron­men­tal bene­fits, inclu­ding job crea­tion.[17] Acti­vity in this area is mainly sup­por­ted by inter­na­tio­nal donors, inclu­ding the EU.[18]

The EGD has the poten­tial to com­ple­tely eli­mi­nate the country’s reluc­tance to update exis­ting eco­no­mic models and to define new per­spec­ti­ves for Georgia’s deve­lo­p­ment. This would require the rele­vant gui­d­ance and skills support coupled with exten­sive awa­reness raising, trans­pa­rency and public invol­ve­ment in decision making to build the owners­hip and ensure a results-ori­en­ted approach. Georgia is expe­ri­en­cing sta­gna­tion in the deve­lo­p­ment of demo­cracy and its economy [19] due to a poli­ti­cal crisis[20] com­bi­ned with Covid-19 pan­de­mic. In this situa­tion, EGD could provide a much-needed sti­mu­lus for further development.

The party cur­r­ently in power is in the process of pre­pa­ring a natio­nal plan for Georgia deve­lo­p­ment to 2030. If deve­lo­ped with wider public par­ti­ci­pa­tion and based on the “grow back better and greener” principle in line with EU legis­la­tion and the EGD, the plan may be able to serve as reco­very tool to address immediate shocks and ensure the sus­tainable deve­lo­p­ment of the country. The EGD tog­e­ther with Asso­cia­tion Agree­ment pro­vi­des new oppor­tu­nities for Georgia to make pro­gress towards sus­taina­bi­lity goals and to access poten­tial finan­cial sources, as well as further Georgia’s ambi­ti­ons for closer inte­gra­tion with EU.

 

Recom­men­da­ti­ons:

  • The EAP summit in 2021 should spot­light the EGD as a major topic, and the EU should con­ti­nue to empha­size this topic on mul­ti­la­te­ral and bila­te­ral levels with the EaP coun­tries to encou­rage co-owners­hip and enga­ge­ment on their part.
  • The Green Deal Roadmap and Stra­tegy should be ela­bo­ra­ted with the invol­ve­ment of all sta­ke­hol­ders and ensure com­mit­ments in envi­ron­ment and climate sector in line with a long-term vision for the areas of energy, indus­try, trade, agri­cul­ture and transport.
  • The new envi­ron­men­tal action plan to be deve­lo­ped should be geared towards Georgia’s tran­si­tion to a climate-neutral, resource-effi­ci­ent clean and cir­cu­lar economy in line with 2030 targets of the Euro­pean Green Deal.
  • The capa­ci­ties of decision makers should be enhan­ced to promote the imple­men­ta­tion of already exis­ting envi­ron­men­tal and climate legis­la­tion, as well as EDG inte­gra­tion into dif­fe­rent eco­no­mic sectors.
  • Ensure sus­taina­bi­lity of the pro­jects funded through EU-related finan­cial streams, inclu­ding those of inter­na­tio­nal finan­cial insti­tu­ti­ons (e.g. EIB, EBRD and etc) and ECAs (e.g. KFW, ADFB , SACE and others).
  • The EU Taxo­nomy Regu­la­tion, estab­li­shing the frame­work for the EU taxo­nomy of sus­tainable acti­vi­ties, should be widely pro­mo­ted and encou­ra­ged vis-à-vis the EaP countries.
  • Promote EGD inte­gra­tion into dif­fe­rent areas at dif­fe­rent levels (coope­ra­tion among par­lia­ments, local aut­ho­ri­ties, deve­lo­p­ment of civil society, aca­de­mia, cross-border coope­ra­tion. etc.).
  • Country stra­te­gies and action plans for zero pol­lu­tion and zero emis­sion systems should be defined for the agri­cul­ture, energy and trans­port sectors.
  • Provide support for and engage in sys­te­ma­tic trans­fer of knowhow – new tech­no­lo­gies, inno­va­tive project models, internships and trai­nings for decision makers, experts, CSOs, businesses.

[1] 31 May 2021 on joint hearing of the Par­lia­men­tary Com­mit­tees on Euro­pean Inte­gra­tion and Envi­ron­men­tal Pro­tec­tion and Natural Resour­ces was men­tio­ned that there are ongoing nego­tia­ti­ons with the EU for Green Deal roadmap and stra­tegy deve­lo­p­ment. The state­ment does not receive any follow up.

[2]   The Euro­pean Green Deal and its Signi­fi­cance for Georgia, Eka­te­rine Mikadze, Febru­ary 2021,

[3] GAPH, 2019, 2019 Pol­lu­tion and Health Metrics: Global, Regio­nal and Country Analysis,

[4] Social-eco­no­mic Deve­lo­p­ment Stra­tegy of Georgia “GEORGIA 2020”, Government of Georgia 2014,

[5] Sus­tainable Deve­lo­p­ment Goals Natio­nal Document.pdf

[6] NEAP‑3 2017–2021,

[7] Network ana­lo­gous to Natura 2000 outside of the EU.

[8] https://rm.coe.int/files04e-2020-georgia-svaneti1-candidate-emerald-site-nenskra-govt-rep/16809ce010

[9] New phase of EU4Energy Gover­nance project laun­ched in Georgia, Moldova and Ukraine

[10] E.g. Georgia’s electri­city net­works deve­lo­p­ment plan 2021–2031

 [11]Despite Bitcoin’s Dive, a Former Soviet Repu­blic Is Still Betting Big , New York Times, 2019, November

[12] Georgia 2020 Energy Policy review, IEA

[13]  Energy Policy Concept of Georgia , Novem­ber 2020, USAID

[14] Georgia Natio­nally deter­mi­ned con­tri­bu­tion 2021,

[15]  Climate Decar­bo­niz­a­tion Sce­n­a­rios for Georgia Trans­port Sector, Thomas Day, Sofia Gon­za­les-Zuñiga, Swithin Lui, New Climate Insti­tute, January 2021

[16] Minis­try of Economy and Sus­tainable Deve­lo­p­ment, 2017, Green Economy Policy and Strategy,

[17] Sup­por­ting the Deve­lo­p­ment of a Green Growth Eco­no­mic Stra­tegy in Georgia, Tech­ni­cal Report, 2018, EaP Green

[18] EU-funded Pro­jects Aiming at the Main Goal and Princi­ples of the Green Deal in Georgia

[19] https://freedomhouse.org/country/georgia/nations-transit/2020

[20]Defu­sing Georgia’s Poli­ti­cal Crisis: An EU Foreign Policy Success? May 2021


 

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