the economic and environmental implications for the eu of...

FINAL STUDY 22.04.2015

EUROPEAN COMMISSION DG ENVIRONMENT

ENV.E.1/ETU/2014/0008rl

The economic and environmental implications for the EU of strengthening cooperation with

the Eastern Neighbourhood countries

www.stellaconsulting.com

The economic and environmental implications for the EU of strengthening cooperation with the Eastern Neighbourhood countries

STELLA Consulting – Final study 22.04.2015

Disclaimer: “The economic and environmental implications for the EU of strengthening cooperation with the Eastern Neighbourhood countries” is a study produced by STELLA Consulting for the European Commission’s DG Environment (DG ENV). The information and views set out in this study are those of the author(s) and do not necessarily reflect the official opinion of the Commission. The Commission does not guarantee the accuracy of the data included in this study. Neither the Commission nor any person acting on the Commission’s behalf may be held responsible for the use which may be made of the information contained herein.



TABLE OF CONTENTS

EXECUTIVE SUMMARY ............................................................................................................................................ I

ABSTRACT .............................................................................................................................................................. V

1 SCOPE ........................................................................................................................................................... 1

1.1 STUDY OBJECTIVE ................................................................................................................................................. 1 1.2 BACKGROUND ..................................................................................................................................................... 2

2 METHODOLOGY ............................................................................................................................................ 4

3 RESULTS ........................................................................................................................................................ 5

3.1 WATER QUALITY................................................................................................................................................... 6 3.1.1 Current environmental situation ............................................................................................................ 6 3.1.2 Benefits from improved water quality ................................................................................................. 11

3.2 MARINE AREAS .................................................................................................................................................. 14 3.2.1 Current environmental situation .......................................................................................................... 14 3.2.2 Benefits from improved marine areas ................................................................................................. 23

3.3 AIR QUALITY ...................................................................................................................................................... 25 3.3.1 Current environmental situation .......................................................................................................... 25 3.3.2 Benefits from improved air quality ...................................................................................................... 28

3.4 BIODIVERSITY .................................................................................................................................................... 32 3.4.1 Current environmental situation .......................................................................................................... 32 3.4.2 Benefits from improved biodiversity .................................................................................................... 37

3.5 WASTE MANAGEMENT ........................................................................................................................................ 39 3.5.1 Current environmental situation .......................................................................................................... 39 3.5.2 Benefits from improved waste management ...................................................................................... 43

3.6 TRADE .............................................................................................................................................................. 45 3.6.1 Eco-industry ......................................................................................................................................... 45 3.6.2 Level playing field ................................................................................................................................ 51

4 CONCLUSIONS ............................................................................................................................................ 54

5 RECOMMENDATIONS FOR ACTION BY THE EU ............................................................................................ 56

5.1 ASSIST EAP COUNTRIES IN IDENTIFYING PRIORITY AREAS FOR PROGRESS ........................................................................ 57 5.2 SUPPORT EAP COUNTRIES IN IMPROVING THEIR ENVIRONMENT SITUATION .................................................................... 57 5.3 CONTINUE TO ENSURE THAT FUTURE TRADE AGREEMENTS MITIGATE ANY ADVERSE ENVIRONMENTAL IMPACTS ...................... 60

BIBLIOGRAPHY ..................................................................................................................................................... 61

ANNEX I – ENVIRONMENTAL PRIORITY AREAS IN EAP COUNTRIES ......................................................................... I

ANNEX II – WATER QUALITY: CURRENT PERSPECTIVE FOR THE EU...................................................................... VIII

ANNEX III – CALCULATIONS OF BENEFITS FROM IMPROVED WATER QUALITY ..................................................... XII

ANNEX IV – AIR QUALITY: CURRENT PERSPECTIVE FOR THE EU .......................................................................... XVI

ANNEX V – CALCULATIONS OF BENEFITS FROM IMPROVED AIR QUALITY ............................................................ XX

ANNEX VI – BIODIVERSITY: CURRENT PERSPECTIVE FOR THE EU ........................................................................ XXII

ANNEX VII – ECO-INDUSTRY MARKET: CALCULATIONS .................................................................................... XXVI

ANNEX VIII – EXECUTIVE SUMMARY IN RUSSIAN ............................................................................................... XXX

ANNEX IX – ABSTRACT IN RUSSIAN ................................................................................................................ XXXIV



LIST OF FIGURES

1. EAP COUNTRIES AND EU MEMBER STATES ............................................................................................................ 1

2. TRANS-BOUNDARY SURFACE WATERS IN THE EAP EASTERN EUROPE COUNTRIES ............................................... 7

3. BALTIC SEA ............................................................................................................................................................ 15

4. CLASSIFICATION OF EUTROPHICATION STATUS IN BALTIC SEA ........................................................................... 16

5. BLACK SEA ............................................................................................................................................................. 18

6. EUTROPHICATION LEVELS IN THE BLACK SEA....................................................................................................... 20

7. DISABILITY ADJUSTED LIFE YEARS (DALYS) ATTRIBUTED TO URBAN PM10 POLLUTION ...................................... 25

8. AVERAGE RESIDENCE TIMES IN THE ATMOSPHERE OF SELECTED POLLUTANTS AND MAXIMUM EXTENT OF THEIR IMPACT ....................................................................................................................................................... 26

9. BLACK STORK (CICONIA NIGRA) AND EUROPEAN BISON (BISON BONASUS): ENDANGERED SPECIES IN AZERBAIJAN AND BELARUS RESPECTIVELY ........................................................................................................... 33

10. OBSOLETE PESTICIDES IN EAP COUNTRIES IN 2013.............................................................................................. 41

11. ENVIRONMENTAL PRIORITY AREAS IN EAP EASTERN EUROPE ............................................................................. III

12. ENVIRONMENTAL PRIORITY AREAS IN EAP SOUTHERN CAUCASUS .................................................................... VII

13. EAP AREAS OF THE DANUBE RIVER BASIN.............................................................................................................. X

14. RIVERS OF BELARUS AND EU-28 IMPACT ............................................................................................................ XIII

15. RIVERS OF MOLDOVA AND EU-28 IMPACT ........................................................................................................ XIV

16. RIVERS OF UKRAINE AND EU-28 IMPACT ........................................................................................................... XIV

17. CURRENT STATUS OF IMPLEMENTATION OF CLRTAP AND ITS PROTOCOLS BY EAP COUNTRY ........................ XVII

18. EMERALD NETWORK PROTECTED SITES ............................................................................................................ XXII



LIST OF TABLES

1. MAIN TRANS-BOUNDARY RIVERS ........................................................................................................................... 6

2. TRANS-BOUNDARY AQUIFERS ................................................................................................................................ 8

3. ACCESS TO SAFE DRINKING WATER BY EAP COUNTRY IN 2008 ............................................................................. 9

4. ACCESS TO SEWAGE NETWORK BY EAP COUNTRY IN 2008 ................................................................................... 9

5. EU RIVERS BENEFITTING FROM IMPROVED RIVER QUALITY IN EAP EASTERN EUROPE GROUP .......................... 12

6. WATER QUALITY TRANS-BOUNDARY BENEFITS TO THE EU IN 2020 .................................................................... 13

7. LENGTH OF COASTLINE OF BLACK SEA COUNTRIES ............................................................................................. 19

8. ESTIMATED DAMAGE FROM EUTROPHICATION IN UKRAINE .............................................................................. 24

9. AIR POLLUTANTS EMITTED (1,000 TONNES) BY EAP COUNTRY IN 2005 .............................................................. 28

10. AIR POLLUTANTS EMITTED (1,000 TONNES) BY EAP COUNTRY IN 2020 .............................................................. 28

11. AIR QUALITY TRANS-BOUNDARY BENEFITS TO THE EU IN 2020 .......................................................................... 30

12. AIR QUALITY DOMESTIC BENEFITS IN 2020 .......................................................................................................... 30

13. PROTECTED AREAS AND PROPOSED EMERALD SITES IN EAP COUNTRIES ........................................................... 35

14. MUNICIPAL SOLID WASTE GENERATION IN EAP COUNTRIES ............................................................................... 40

15. OBSOLETE PESTICIDES BY EAP COUNTRY IN 2011 ................................................................................................ 42

16. WEEE BY EAP COUNTRY IN 2012 .......................................................................................................................... 43

17. PAST ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN SIX EAP COUNTRIES........................................... 46

18. PAST ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN EU-28 ................................................................ 47

19. ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN EU-27.......................................................................... 47

20. ESTIMATED 2013 EPE IN SIX EAP COUNTRIES ...................................................................................................... 48

21. EPE GROWTH IN THE EU (2000-2008) .................................................................................................................. 49

22. ESTIMATED 2020 ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN SIX EAP COUNTRIES ....................... 49

23. SHARE OF EXTERNAL ECO-TRADE IN SIX EAP COUNTRIES CAPTURED BY EU-28 .................................................. 50

24. EU EXPORTS TO THE SIX EAP COUNTRIES IN 2013 ............................................................................................... 51

25. CURRENT STATUS OF EU TRADE AGREEMENTS WITH EAP COUNTRIES ............................................................... 52

26. UNECE WATER CONVENTION AND EAP COUNTRIES ............................................................................................. IX

27. DOMESTIC BENEFITS OF MEETING WATER QUALITY IMPROVEMENT TARGETS IN 2020 .................................... XII

28. EU RIVERS BENEFITTING FROM IMPROVED RIVER QUALITY IN EAP EASTERN EUROPE GROUP ......................... XIII

29. WATER QUALITY TRANS-BOUNDARY BENEFITS FOR THE EU IN 2020 ................................................................. XV

30. DOMESTIC BENEFITS BY EAP COUNTRY IN 2020 ................................................................................................. XX

31. TRANSBOUNDARY BENEFITS BY EAP COUNTRY IN 2020 .................................................................................... XXI



32. AIR QUALITY TRANS-BOUNDARY BENEFITS FOR THE EU IN 2020 ...................................................................... XXI

33. POPULATION AND GDP PER CAPITA OF EAP COUNTRIES ................................................................................. XXVI

34. EU ECO-EXPORTS TO THE SIX EAP COUNTRIES IN 2012 AND 2013 ................................................................ XXVIII

35. EXTERNAL TRADE FOR ENVIRONMENTAL TECHNOLOGIES AND GOODS IN 2010 ............................................ XXIX



LIST OF BOXES

1. CROSS-BORDER COOPERATION (POLAND, BELARUS, AND UKRAINE) TO PROTECT AGAINST FLOODS IN THE BUG RIVER VALLEY .............................................................................................................................................. 10

2. EU WATER INITIATIVE IN EASTERN EUROPE, THE CAUCASUS AND CENTRAL ASIA............................................. 11

3. BENEFITS TO THE BALTIC SEA FROM BELARUS, A LANDLOCKED COUNTRY........................................................ 17

4. PARTIAL RECOVERY OF THE BLACK SEA ECOSYSTEM .......................................................................................... 20

5. OIL POLLUTION IN THE BLACK SEA ...................................................................................................................... 21

6. IMPROVING ENVIRONMENTAL MONITORING IN THE BLACK SEA (EMBLAS) ..................................................... 22

7. MSFD GUIDING IMPROVEMENTS IN THE BLACK SEA INTEGRATED MONITORING SYSTEM (MISIS) ................... 22

8. SPREAD OF RADIATION FROM CHERNOBYL ACCIDENT....................................................................................... 27

9. AIR QUALITY GOVERNANCE IN ENPI EAST COUNTRIES ....................................................................................... 29

10. EMERALD NETWORK ........................................................................................................................................... 32

11. THE IMPACTS IN HUNGARY OF SHOOTING THE RED-FOOTED FALCON IN UKRAINE .......................................... 33

12. SPREAD OF HERACLEUM SOSNOWSKYI IN EAP COUNTRIES AND THE EU .......................................................... 34

13. SUCCESSFUL REINTRODUCTION OF THE BISON IN BELARUS AND POLAND ....................................................... 36

14. CONSERVATION OF THE SAKER FALCON (FALCO CHERRUG) IN THE EU AND IN UKRAINE ................................. 38

15. SAFE DISPOSAL OF HARMFUL CHEMICAL SUBSTANCES IN MOLDOVA ............................................................... 42

16. WASTE GOVERNANCE IN THE ENPI EAST ............................................................................................................ 44

17. COMPARATIVE ADVANTAGE OF EU IN THE GLOBAL ECO-MARKET .................................................................... 49

18. GREENING ECONOMIES IN THE EASTERN NEIGHBOURHOOD ............................................................................ 50

19. KEY RECOMMENDATIONS OF ENPI STUDY ......................................................................................................... 56

20. KEY RECOMMENDATIONS OF EAP GREEN ECONOMY STUDY ............................................................................. 56



ACRONYMS AA Association Agreements BAM Benefit Assessment Manual BRICS Brazil, Russia, India, China and South Africa BSAP Baltic Sea Action Plan BSC Black Sea Commission CAP Common Agricultural Policy CBC Cross-Border Cooperation CBD Convention on Biological Diversity CLRTAP Convention on Long-Range Trans-boundary Air Pollution CO Carbon Monoxide CO2 Carbon Dioxide DALYs Disability Adjusted Life Years DCFTA Deep and Comprehensive Free Trade Areas DG ENV European Commission’s DG Environment DRPC Danube River Protection Convention EaP Eastern Partnership EC European Commission EEA European Environment Agency EEE Electrical and Electronic Equipment EIA Environmental Impact Assessment EIB European Investment Bank ENI European Neighbourhood Instrument ENP European Neighbourhood Policy ENPI European Neighbourhood and Partnership Instrument EPE Environmental Protection Expenditures EPTATF Eastern Partnership Technical Assistance Trust Fund EU European Union GDP Gross Domestic Product GES Good Environmental Status GHG Greenhouse Gas GIS Geographic Information System GPP Green Public Procurement HELCOM Baltic Marine Environment Protection Commission HH Households IPPC Integrated Pollution Prevention and Control IUCN International Union for Conservation of Nature IWRM Integrated Water Resources Management JASPERS Joint Assistance to Support Projects in European Regions MS EU Member States MSFD EU Marine Strategy Framework Directive MSW Municipal Solid Waste NACE Statistical Classification of Economic Activities in the European Community NH3 Ammonia NMVOC Non-Methane Volatile Organic Compounds NO2 Nitrogen Dioxide NO3 Nitrate NOx Nitrogen Oxides NPD National Policy Dialogue PAHs Polyaromatic hydrocarbons PCA Partnership and Cooperation Agreements PM Particulate Matter



POM Placed on the Market POPs Persistent Organic Pollutants PPP Purchasing Power Parity SCI Site of Community Importance SCP Sustainable Consumption and Production SEA Strategic Environmental Assessment SEIS Shared Environmental Information System SMEs Small and Medium-sized Enterprises SO2 Sulphur Dioxide

SO42-

Sulphate SPA Special Protection Area TFP Total Factor Productivity UNCCD United Nations Convention to Combat Desertification UNECE United Nations Economic Commission for Europe UNEP United Nations Environment Programme UNESCO United Nations Educational, Scientific and Cultural Organization UNFCCC United Nations Framework Convention on Climate Change US United States of America USSR Union of Soviet Socialist Republics VOCs Volatile Organic Compounds WEEE Waste Electrical and Electronic Equipment WFD EU Water Framework Directive WTP Willingness to Pay

LIST OF PEOPLE CONTACTED

Laura Giappichelli Directorate-General for Neighbourhood and Enlargement Negotiations (DG NEAR)

Bella Nestorova Directorate-General for Neighbourhood and Enlargement Negotiations (DG NEAR)

Ruslan Zhechkov Regional Environmental Center

Oleksader Klitko European Commission's Delegation to Ukraine

Henno Putnik European Commission's Delegation to Moldova

Philippe Bernhard European Commission's Delegation to Belarus

Jeroen Willems European Commission's Delegation to Azerbaijan

John Barker European Commission's Delegation to Armenia

Murielle Lambert de Rouvroit European Commission's Delegation to Georgia

Anne Theo Policy officer Biodiversity Unit, DG ENV

Hannamaria Yliruusi Project manager PRESTO project

Nickolaï Denisov Regional director, Zoï environment network

Kaj Granholm Baltic compass

Aleksander Stankevich Belarus National Focal Point

Aliaksandr Pakhomau RCRCM Belarus

Jakob Granit & Maria Osbeck Stockholm Environment Institute

Timothy Turner Team Leader EU project "Environmental Protection of International River Basins"

Raphael Veit Sagis Ltd


STELLA Consulting – Final study 22.04.2015 Page i

EXECUTIVE SUMMARY

The countries neighbouring the EU-28 to the east –the Eastern Neighbourhood– have a special political and economic significance for the EU, and the EU pursues a policy of gradually strengthening ties with them. This study assesses the potential environmental and economic benefits for the EU that would result from the increased convergence of the Eastern Partnership (EaP) countries –Belarus, Ukraine, Moldova, Azerbaijan, Georgia and Armenia– to the EU environmental acquis. Environmental degradation in the Eastern Neighbourhood has a direct and visible impact inside the EU. Various environmental sectors have trans-boundary effects. For example, the EU has various common river basins with the EaP countries, shares the Baltic1 and Black seas, is affected by air pollution from EaP countries, and shares biodiversity resources. The application –or not– of environmental legislation in EaP countries, including horizontal legislation on environmental impact assessment, affects the EU economy and EU enterprises active in Eastern Europe. To assess and quantify (when possible) the main potential benefits to the EU of environmental improvements in the EaP countries, this study has analysed the current environmental situation in the EaP countries and projected (when possible) what the situation would be in 2020 in the following six areas:

1. Water quality; 2. Marine areas; 3. Air quality; 4. Biodiversity; 5. Waste management; and 6. Trade.

1 Although none of the EaP countries has a coastline along the Baltic Sea, two EaP countries (Belarus

and Ukraine) are in the drainage basin, i.e., they have rivers flowing into the Baltic Sea.

EaP EASTERN EUROPE AND EaP SOUTHERN CAUCASUS

For the purpose of the study, the six EaP countries were divided into two distinct geographic groups:

EaP Eastern Europe (Belarus, Moldova and Ukraine); and

EaP Southern Caucasus (Armenia, Azerbaijan and Georgia).

The EaP Eastern Europe group has common borders with six EU Member States (Latvia, Lithuania, Poland, Slovakia, Hungary and Romania). The three countries in this group therefore share more direct water, marine, air and biodiversity resources with the EU-28 than the EaP Southern Caucasus group. Nevertheless, the EaP Southern Caucasus countries share notable trade relations with the EU as well as an important environmental resource: the Black Sea.


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The results presented in the study lead to three main conclusions:

1. EaP countries and EU to benefit significantly from environmental improvements in EaP countries

The EaP countries and the EU will both benefit from environmental improvements in EaP countries and these benefits will be significant, even if some of them are difficult to quantify due to a lack of valuation studies on the impact of environmental degradation in the literature. The EU can expect to gain benefits amounting to at least €8 billion per year as of 2020: €2.6 billion from air improvements due to reduced mortality and morbidity, and €5.4 billion from water improvements, estimated based on willingness to pay. The EU should also benefit from increased revenue from eco-trade of €51 million/year, equivalent to 434 jobs. Other benefits would accrue from an enhanced marine environment, increased biodiversity and improved waste management. The six EU countries bordering the EaP countries (Romania, Hungary, Slovakia, Poland, Lithuania and Latvia) stand to gain the most.

2. Preliminary indications for identifying priority areas for action This study is a first illustrative estimate of the benefits expected to accrue from environmental improvements in EaP countries. For example, the study shows that the highest expected benefits would be from improvements in the water and air sectors. However, this is likely to be because these two sectors are the ones for which the most valuation studies are available in the literature. Similarly, the study suggests that improvements in Ukraine would yield the highest benefits; however, this is primarily because Ukraine is the largest and most populated EaP country. The study also shows that the EaP countries and the EU would benefit from the remediation of ‘hot spots’, such as obsolete pesticides in various locations in Moldova, or hazardous waste tanks in Belarus. However, it was beyond the scope of the study to quantify the risk from these hot spots or the benefits that would result from their remediation.

3. Expected benefits to materialise only if the EaP countries improve their environmental situation

Unsurprisingly, the first countries to benefit from environmental improvements in the EaP countries are the EaP countries themselves. Overall, citizens from EaP countries would benefit in terms of cost savings and improved quality of life. These benefits could be substantial, e.g., €9 billion/year due to improved air quality alone. To improve their environmental situation, the EaP countries have to increase their investment in more effective environmental policy-making, implementation, financing and enforcement. The EaP countries should strengthen their national environmental policies/targets and support their implementation in order to perceive trans-boundary benefits.


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How can the EU support the EaP countries with this process? The EU is already supporting the EaP countries in many ways (e.g., cross-border cooperation, regional programmes on environment, financial support through the EIB investments, technical assistance and negotiation of trade agreements). Therefore, the primary requirement is to strengthen and speed up the EU support to EaP countries. This study has identified three recommendations for the EU to support the EaP countries in improving their environment:

1. Assist EaP countries in identifying priority areas for progress To identify priority areas for progress, the EaP countries and the EU need to improve the quality of the available environmental data and indicators; this improved data would in turn allow detailed cost-benefit analyses. The improvement of data quality should be ensured through the following measures:

Improve the EU Shared Environmental Information System (SEIS) for better environmental data and indicators; and

Conduct a detailed cost-benefit analysis to identify the cost-effectiveness of improvements in various environmental sectors.

2. Support EaP countries in improving their environment situation

Many hot spots in the EaP countries could benefit from an immediate remediation, particularly those on the border between one of the EaP countries and an EU Member State. More generally, any improvements in the environmental situation of the EaP countries will benefit the EaP countries and the EU. Therefore, the EU should strengthen its support by:

Pursuing cross border cooperation. The Commission should ensure that there are adequate CBC programmes addressing the priorities under Objective 6 (Environmental protection, climate change mitigation and adaptation).

Increasing financial support through EIB. Energy efficiency, renewable energy, sustainable transport, urban infrastructure and water have been identified as areas with substantial investment needs in the region.

3. Continue to ensure that future trade agreements mitigate any adverse

environmental impacts The EU and EaP countries are currently negotiating upgrades of trade agreements incorporating environmental dimensions. The EaP countries have already taken on, or will soon take on, significant obligations to promote high standards of environmental protection, to enforce environmental laws effectively and to not derogate such laws to


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attract investment. They will also promote corporate social responsibility, with particular attention to environmental management in key export sectors. EaP exporters have made progress in environmental management, improving EaP countries’ reputation as reliable suppliers and securing access to foreign markets. The Commission should continue to ensure that all ongoing and future trade agreements fully take into account the need to mitigate any adverse environmental impacts.


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ABSTRACT

This study assesses the potential environmental and economic benefits to the EU resulting from the convergence of the six Eastern Partnership (EaP) countries –Belarus, Ukraine, Moldova, Azerbaijan, Georgia and Armenia– to the EU environmental acquis. The study concludes that the EaP countries and the EU will benefit from environmental improvements in EaP countries and these benefits are significant, even if some of them are difficult to quantify (due to a lack of valuation studies on the impact of environmental degradation in the literature). The EU can expect to gain benefits amounting to at least €8 billion per year: €2.6 billion from air improvements due to reduced mortality and morbidity, and €5.4 billion from water improvements, estimated based on willingness to pay. The EU should also benefit from increased trade, a better marine environment, increased biodiversity and improved waste management. These expected benefits will materialise, however, only if the EaP countries increase their investments in more effective environmental policy-making, implementation, financing and enforcement. The study recommends therefore that the EU should strengthen and speed up its existing support to EaP countries as follows:

1. Assist EaP countries in identifying priority areas for progress;

2. Support EaP countries in improving their environment situation; and

3. Continue to ensure that future trade agreements mitigate any adverse environmental impacts.

This study is a first illustrative estimate of the benefits. For example, the study shows that the highest expected benefits would be from improvements in the water and air sectors. However, this is likely to be because these two sectors are the ones for which the most valuation studies are available in the literature. Similarly, the study suggests that improvements in Ukraine would yield the highest benefits; however, this is primarily because Ukraine is the largest and most populated EaP country. The study also shows that the EaP countries and the EU would benefit from the remediation of ‘hot spots’, such as obsolete pesticides in various locations in Moldova, or hazardous waste tanks in Belarus. However, it was beyond the scope of the study to quantify the risk from these hot spots or the benefits that would result from their remediation.


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1 SCOPE

1.1 Study objective

The objective of this study is to assess the potential environmental and economic benefits to the EU resulting from the convergence of the six Eastern Partnership (EaP) countries –Belarus, Ukraine, Moldova, Azerbaijan, Georgia and Armenia, see Figure 1– to the EU environmental acquis.

FIGURE 1 EAP COUNTRIES AND EU MEMBER STATES

Source: The Eastern Partnership, 2014 (http://eeas.europa.eu/eastern/index_en.htm)

For the purpose of this study, the six EaP countries are divided into two distinct geographic groups:

EaP Eastern Europe (Belarus, Moldova and Ukraine); and

EaP Southern Caucasus (Armenia, Azerbaijan and Georgia). The EaP Eastern Europe group has common borders with six EU Member States (Latvia, Lithuania, Poland, Slovakia, Hungary and Romania). Therefore, the three countries in this group share more water, marine, air and biodiversity resources with the EU-28 than the EaP Southern Caucasus group. Nevertheless, the EaP Southern

Armenia

Belarus

Azerbaijan

Georgia

Ukraine

Moldova



Caucasus countries share notable trade relations with the EU as well as an important environmental resource: the Black Sea. Annex I presents a number of key environmental priority areas in the EaP Eastern Europe group and the EaP Southern Caucasus group.

1.2 Background

The countries neighbouring the EU-28 to the east (Eastern Neighbourhood) have a special political and economic significance for the EU and the EU pursues a policy of gradually strengthening ties with them. Environmental cooperation with the EaP countries lies in the framework of EU external policy, the European Neighbourhood Policy (ENP). The foreign ministers of Poland and Sweden presented and launched the Eastern Partnership (EaP) initiative at a summit in Prague on 7 May 2009 to respond to the aspirations –albeit in varying degrees-- of the partner countries to move closer to the EU. The EaP's aim is to strengthen the bilateral and regional relations with EaP countries, support political and economic reforms and assist EaP countries in the process of EU political approximation and economic integration. At the basis of the initiative lies a shared commitment to international law and fundamental values, including democracy, the rule of law and respect for human rights and fundamental freedoms, as well as to market economy, sustainable development and good governance. Special relations with most of the Eastern neighbours led to the negotiation of new Association Agreements (AA), which include Deep and Comprehensive Free Trade Areas (DCFTA) with Armenia, Georgia, Moldova and Ukraine. The EU signed AA with Georgia, Moldova and Ukraine in June 2014. The AA will be a basis for further close cooperation and aligning with the EU acquis, including in the field of environment. The work under the EaP is divided into four areas (called Platforms). Environment is included in Platform 2: ''Economic Integration and Convergence with EU Policies''. To highlight the importance of environment and climate change, a Panel on Environment and Climate Change was created under Platform 2. The Panel focuses on establishing good environmental governance in the EaP region, introducing the concept of green economy and promoting climate change policies. More specifically, in the field of environment, the EU is interested in the following actions:

Improving the environmental status of air, soil, biodiversity, forests, and water including marine environment, improving water and waste management, etc.;



Ensuring better participation in and implementation of Multilateral Environmental Agreements towards the achievement of regional and global environmental goals on air, biodiversity and civil society involvement on environmental matters;

Strengthening environmental governance by, inter alia, enhancing institutional capacities;

Engaging with countries on introducing resource efficiency and adopting green economy principles;

Strengthening civil society; and

Creating a level playing field for EU enterprises by introducing similar requirements towards environmental issues.

Approximating EU legislation remains a priority for the EaP countries, as agreed in the Work Programme of Platform 2 for 2014-2017. In the years to come, despite the difficult geo-political situation in the region, we can expect an increased focus on approximating the EU environmental legislation in the EaP countries. The degree of approximation will probably vary from significant (Georgia, Moldova) to ''cherry picking'' (Azerbaijan, Belarus), but will be an important pillar of the EU policy towards the EaP partners and should raise environmental protection standards in the EaP countries.



2 METHODOLOGY

To achieve its objective --to estimate the potential economic benefits that the EU would gain from environmental improvements in the EaP countries-- the study has assessed six key areas:

1. Water quality;

2. Marine areas (Baltic Sea and Black Sea);

3. Air quality;

4. Biodiversity;

5. Waste management (municipal solid waste, persistent organic pollutants and waste electric and electronic equipment); and

6. Trade (eco-market and a level playing field). For each of these six areas, the study:

1. Identified shared resources between the EU and the six EaP countries;

2. Analysed the current environmental situation and –when possible– the situation expected in 2020; and

3. Estimated the benefits to the EU resulting from improvements. The methodology consisted of a desk review and analysis, based on multiple sources of information (see Bibliography). In particular, the study relied on the ENPI study (ten Brink et al., 2011) and its associated Benefit Assessment Manual (Bassi et al., 2011), an excellent tool to quantify and monetise environmental benefits. The study also relied on ‘hot spot’ maps to summarise the key environmental priority areas in the EaP countries. In addition, the study contacted various stakeholders in the EaP countries (see list of contacted people at the beginning of the study), including EU Delegations and the offices of the Regional Environmental Center. View the limited resources available, the approach was to identify the most important benefits to the EU of environmental improvements in the EaP countries via a set of indicators covering the six areas of the study; the study did not aim to be exhaustive. The study quantified the benefits from environmental improvements wherever possible, but did not provide any estimate where data or other relevant information was not available.



3 RESULTS

The current environmental situation in the EaP countries and projection (when possible) of the situation in 2020 are presented in the following six sections:

1. Water quality;

2. Marine areas;

3. Air quality;

4. Biodiversity;

5. Waste management; and

6. Trade.



Monetised trans-boundary benefits, according to willingness to pay (WTP) –based on ten Brink et al., 2011– and adjustment based on river length:

€5.4 billion per year starting in 2020

Rough estimates of benefits due to the uncertainty around transferring values

across quite different contexts, assuming that differences in WTP are only related to differences in socio-economic or environmental context variables.

3.1 Water quality

3.1.1 Current environmental situation

The countries in the EaP Eastern Europe group share a number of rivers with the EU-28 (see Table 1). Most of the water resources in this group are of a trans-boundary nature, with many countries highly dependent on flows generated outside their boundaries, as shown in Figure 2. Such interconnectedness and related vulnerability emphasise the importance of good trans-boundary cooperation. Measures to improve the quality of water bodies and improve water use efficiency will, therefore, in many cases provide additional benefits to neighbouring countries and, conversely, some benefits from improved water quality will require measures to be adopted in neighbouring countries. This study identifies benefits from improved water quality in the countries of the EaP Eastern Europe group.

TABLE 1 MAIN TRANS-BOUNDARY RIVERS

River characteristics Length in EaP country

Length in EU-28 Name Length (km) Source Mouth

Daugava (or Western Dvina)

1,020 Russia Baltic Sea Belarus (338 km) Latvia (352 km)

Neman 914 Belarus Baltic Sea Belarus (436 km) Lithuania (359 km)

Neris (or Viliya) 510 Belarus Neman river (then Baltic Sea)

Belarus (276 km) Lithuania (235 km)

Merkys 213 Belarus Neman river (then Baltic Sea)

Belarus (18 km) Lithuania (195 km)

Narew 484 Belarus Vistula river (then Baltic Sea)

Belarus (36 km) Poland (448 km)

Bug 772 Ukraine Narew river (then Baltic Sea)

Ukraine (185 km) Poland (224 km)

Ukraine-Poland border (185 km)

Belarus-Poland border (178 km)

Latorica 188 Ukraine Tisza river (then Black Sea)

Ukraine (157 km) Slovakia (31 km)



River characteristics Length in EaP country

Length in EU-28 Name Length (km) Source Mouth

Tisza (or Tisa) 965 Ukraine Danube (then Black Sea)

Ukraine (155 km) Hungary (572 km) Romania (61 km) Slovakia (5 km)

Siret (or Sireth) 706 Ukraine Danube (then Black Sea)

Ukraine (110 km) Romania (596 km)

Prut (or Pruth) 953 Ukraine Danube (then Black Sea)

Ukraine (211 km) Romania (22 km)

Moldova-Romania border (681 km)

Ukraine-Romania border (39 km)

Source: STELLA Consulting

FIGURE 2

TRANS-BOUNDARY SURFACE WATERS IN THE EAP EASTERN EUROPE COUNTRIES

Source: Bernardini et al., 2011



The countries in the EaP Eastern Europe group share aquifers with some EU Member States (see Table 2), but the EaP Southern Caucasus group countries do not, being too distant. The total surface area of shared EaP aquifers with the EU is 152,653 km2.

TABLE 2 TRANS-BOUNDARY AQUIFERS

Area (km2) EaP country EU-28 country

62,871 Belarus Lithuania, Latvia

24,137 Belarus Lithuania, Poland

17,008 Belarus, Ukraine Poland

3,364 Ukraine Romania

4,948 Moldova Romania

24,831 Moldova Romania

15,494 Moldova, Ukraine Romania

152,653

Source: ISARM, 2014 (http://ggmn.e-id.nl/ggmn/GlobalOverview.html)

Although water is a critical foundation for ecosystems, health and social and economic well-being, in general, the EaP countries suffer from low quality of drinking water and surface water, inadequate water supply and poor wastewater collection and treatment (ten Brink et al., 2011). Almost all the infrastructure finds its origin in Soviet planning, which included the provision of drinking water systems, some wastewater collection and treatment, as well as the adoption of relevant standards. In many cases, however, the infrastructure is out of date or has ceased to function. Annex II summarises the current commitment of the EaP countries to comply with the most relevant Multilateral Environmental Agreements and EU legislation (UNECE Water Convention, Danube River Protection Convention, and Water Framework Directive). The current status of water resources in the EaP countries is summarised in the following points:

Access to safe drinking water: provision of safe drinking water is an important development objective and adopting measures to ensure its provision, and implementing these measures, will lead to significant benefits. Access to safe drinking water is more extensive for urban than rural populations (see Table 3). In rural areas, the differences among countries are more significant (from over 70% in Armenia and Belarus down to only 13% in Moldova).



TABLE 3 ACCESS TO SAFE DRINKING WATER BY EAP COUNTRY IN 2008

EaP country Piped water on premises (%)

Urban Rural Total

Eastern Europe group

Belarus 95 75 89

Moldova 79 13 40

Ukraine 87 25 67

Southern Caucasus

group

Armenia 97 70 87

Azerbaijan 78 20 50

Georgia 92 51 73

Source: ten Brink et al., 2011

Sewage network and wastewater treatment: the discharge of untreated, or poorly treated, wastewater from domestic sources can contaminate drinking water. Therefore, the problems of poor drinking water and poor access to a sewage network overlap. The connection rate to a sewage network in the EaP countries varies significantly (see Table 4). The connection rates in rural areas are very low: Belarus has the highest rate (38%) while Moldova (3%) and Azerbaijan (2%) have the lowest rates. The level of wastewater treatment is often poor, especially in rural areas.

TABLE 4

ACCESS TO SEWAGE NETWORK BY EAP COUNTRY IN 2008

EaP country Toilets connected to sewage network (%)

Urban Rural Total


Belarus 79 38 68

Moldova 63 3 28

Ukraine 68 6 48

Southern Caucasus

group

Armenia 92 17 65

Azerbaijan 62 2 33

Georgia 78 4 43


Surface water quality: the main problem of surface water quality in EaP countries is the lack of infrastructure for clean water supply and wastewater treatment, especially in rural areas. The discharge of wastewater without adequate treatment affects most major rivers. Surface water generally has high concentrations of heavy metals, biological oxygen demand, and



chemical oxygen demand. Unauthorised, spontaneously created dump sites also pollute surface water, since household waste is often dumped on the banks of rivers. For example, one illustrative problem concerns the Bug valley at the border between Poland and Belarus, in the area of Terespol-Brest: the presence of sludge storage tanks could cause an ecological disaster in case of an accident (see Box 1).

BOX 1 CROSS-BORDER COOPERATION (POLAND, BELARUS, AND UKRAINE) TO PROTECT AGAINST

FLOODS IN THE BUG RIVER VALLEY

Source: Baltic Compass Report, 2012

In Ukraine, the Chernobyl2 accident added to the pollution of surface water, foremost the catchments of the Prypiat and Dnipro river basins (ten Brink et al., 2011).

2 The accident at the Chernobyl nuclear power plant in 1986 was the most severe in the history of the

nuclear power industry, causing a huge release of radionuclides over large areas of Belarus, Ukraine and the Russian Federation (see

Despite many political problems, some international projects such as Flood Wise, Baltic COMPASS, reconstruction of the Augustowski Channel or Polish input to the reconstruction and extension of the treatment plant in Brest have tried to improve the water quality of the Bug River. The basic issues to be agreed on during bilateral cooperation between Poland and Belarus are: common strategy for water monitoring, identification of threats to water quality, and common actions undertaken in case of flood risk. One of the main problems to solve in the Bug Valley, in the area of Terespol-Brest, is the presence of sludge storage tanks that could cause an ecological disaster in case of an accident. These tanks have stored untreated waste from Brest for many years and are not currently used. However, a flood could destroy the embankments and send the untreated waste to the river, thus causing significant pollution. There are no data on the volume or chemical composition of this waste; however, given its origin, it is likely to contain harmful chemicals, including heavy metals. Between 2003 and 2006, two independent studies in cross-border cooperation between Poland, Belarus and Ukraine were prepared to protect against floods:

“Cross-border strategy for protection against flood in the basin of the Bug River” contains a general programme of basic directions and frames of protection of objects in the flood plains; and

“The concept of technical and ecological protection of the cross-border Bug River valley against flood in the area of Brest and Lubelskie Voivodship” defines flood protection devices in the area of Brest and Lubelskie Voivodship in the flood plain.



The National Policy Dialogues (NPD) on Integrated Water Resources Management (IWRM) in Eastern Europe, the Caucasus and Central Asia -EU Water Initiative (EUWI-EECCA)- aims to improve coordination and cooperation between sectors with a view to favouring water management policy reform processes and facilitate more effective development assistance in the water sector. This EC-financed €3.2 million project is implemented over the 2012-2015 period in Armenia, Azerbaijan, Georgia, Moldova, Russia, Ukraine, Kazakhstan, Kyrgyz Republic and Tajikistan. The main activities include:

Promoting political commitment;

Benchmarking and exchanging experiences;

Disseminating project information and strengthening stakeholder involvement;

Promoting trans-boundary policy dialogues on IWRM; and

Developing a robust analytical basis for elaborating policy packages.

Overall, the lack of monitoring stations, and sometimes also lack of, or inadequacy of, national quality standards for substances, make it impossible for most countries to assess the pollution situation of their rivers, lakes, reservoirs and groundwater.

3.1.2 Benefits from improved water quality

As the countries in the EaP Eastern Europe group share trans-boundary waters with neighbouring EU countries, both upstream and downstream, measures to improve the quality of water bodies and water use efficiency will provide additional benefits to neighbouring EU countries. The EaP Southern Caucasus group of countries, on the other hand, is too distant from the EU-28 (its impact on the Black Sea is analysed under the marine areas section (see Section 3.2 below)). To achieve these benefits, Integrated Water Resources Management is necessary, as well as proper water governance and management, sustainable river basin approaches, financial resources, and political commitment. The EU Water Initiative is promoting all these and is a good example of successful cooperation (see Box 2).

BOX 2 EU WATER INITIATIVE IN EASTERN EUROPE, THE CAUCASUS AND CENTRAL ASIA

Source: EUWI, 2014 (www.euwi.net)

Box 8 below). Since 1986, radiation levels in the affected environments have declined several hundred-

fold because of natural processes and countermeasures. Therefore, the majority of the ‘contaminated’ territories are now safe for settlement and economic activity. However, in the Chernobyl Exclusion Zone and in certain limited areas, some restrictions on land-use will remain for decades to come.



To quantify the benefits for the EU from improved water quality, this study has estimated monetary trans-boundary benefits for the main EaP rivers that have an impact on EU rivers (see Table 5). This study assumes that all EaP countries would aim to match the targets of the EU Water Framework Directive and the objective of no deterioration in quality and achievement of Good Ecological Status in 2020.

TABLE 5 EU RIVERS BENEFITTING FROM IMPROVED RIVER QUALITY IN EAP EASTERN EUROPE GROUP

EaP Eastern Europe group EU river benefitting from improved river quality

Belarus Neman, Neris and Merkys (in Lithuania)

Vistula, Bug and Narew (in Poland)

Daugava (in Latvia)

Moldova Prut, Danube and Chilia (in Romania)

Ukraine Vistula and Bug (in Poland)

Danube, Siret, Chilia and Borcea (in Romania)

Latorica (in Slovakia)

Tisza and Bodrog (in Hungary)

Source: STELLA Consulting

This study has estimated monetary trans-boundary benefits with a Geographic Information System (GIS), identifying the main EaP rivers that have an impact on the EU-28 territory. To estimate the benefits for the EU in particular, this study assumed that the impact would be proportional to the length of the river. The monetary benefits are equal to the estimated amount of money that households in each EaP country would be willing to pay for improved surface water quality by 2020. This study has calculated the benefit per kilometre of river, using the average Willingness To Pay (WTP) estimate3 (ten Brink et al., 2011) and calculated the length of the rivers shared with an EU Member State to estimate the trans-boundary benefit according to the length of river within the EU-28 territory. This assumes that all water bodies in each country have the same value, which becomes important when considering that values for some water bodies may be higher if they are of significant importance (for example, for cultural reasons) or if water resources are scarce. Values may also decrease when overall water quality in the country increases as a result of the improvements.

3 The WTP used for this study is based on a Benefits Function Transfer (BFT) defined in Bassi et al.,

2011. Unlike direct value transfer, the BFT method allows for the incorporation of differing socio-economic and site quality characteristics between the original study site for which the original benefits estimates were obtained and the policy site under evaluation. Under this approach, typically only one original valuation study is selected. The main assumption is that preferences/tastes are the same for both locations and differences in WTP are only related to differences in socio-economic and/or environmental context variables.



This study has adjusted the WTP in ten Brink et al., 2011 (based on the ratio of the EU GDP to the GDP in each EaP country) and considered that the EaP countries’ WTP was the same as in the neighbouring EU Member States (Latvia, Lithuania, Poland, Slovakia, Hungary and Romania). Annex III has more details on the methodology and calculations. Due to the uncertainty around transferring values across quite different contexts, including the assumption that differences in WTP are only related to differences in socio-economic or environmental context variables, the findings should be treated as fairly rough estimates. The domestic benefits are shown in a range (from a lower to an upper estimate) to illustrate the degree of uncertainty associated with the estimates; this study has used the average to estimate the trans-boundary benefits. In conclusion, the study foresees that improved water quality in the EaP countries could provide the EU with monetary benefits of €5.4 billion per year starting in 2020 (see Table 6), provided the water quality levels achieve the Good Ecological Status for all river surfaces. More than 70% of the benefits (€3.9 billion) come from improvements in Ukraine.

TABLE 6 WATER QUALITY TRANS-BOUNDARY BENEFITS TO THE EU IN 2020

EaP Eastern Europe group

Domestic aggregated benefits in 2020

(€ million) Rivers' length (km)

Trans-boundary benefits to the EU in 2020 (€ million)

Lower estimate

Upper estimate

Average estimate

Average after GDP

adjustment

In the country

In the EU-28 (down-stream)

Benefits per km of river

Benefits for the EU

rivers

Belarus 204.00 718.00 461.00 2,083.95 13,317.06 6,100.14 0.16 954.60

Moldova 45.40 177.10 111.25 1,708.71 2,722.69 901.85 0.63 565.98

Ukraine 870.10 3,180.50 2,025.30 17,782.81 26,252.99 5,702.82 0.68 3,862.88

Total 5,383.46

Source: STELLA Consulting’s estimates based on ten Brink et al., 2011



Main contributors to the environmental problems of the Baltic Sea and the Black Sea are the rivers leading into them

Key trans-boundary problems of marine areas include eutrophication/nutrient enrichment, changes in marine living resources, chemical pollution (including oil), and biodiversity/habitat changes, including alien species introduction

Estimates of benefits due to better water quality in rivers already include to a

large extent the potential marine benefits

3.2 Marine areas


The EU and EaP countries share the Baltic Sea and the Black Sea, which are home to a wide diversity of underwater habitats and species. However, the marine environment is under ever-increasing pressure from human activity, including fisheries, pollution and industrialisation.

Baltic Sea

The Baltic Sea’s coastline is around 8,000 km, its surface area is about 349,644 km² and its volume is about 20,000 km³. While none of the EaP countries has a coastline along the Baltic Sea (see Figure 3), two EaP countries (Belarus and Ukraine) are in its drainage basin, i.e., they have rivers flowing into the Baltic Sea:

Neman (Belarus);

Daugava (Belarus); and

Vistula (via Bug and Narew; Belarus and Ukraine). Eight EU Member States have a coastline along the Baltic Sea: Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Poland and Sweden. The only non-EU country with a coastline along the Baltic is Russia. In addition, other two EU Member States have rivers flowing into the Baltic Sea: the Czech Republic and Slovakia. The Baltic Sea’s main environmental challenges include: eutrophication, inputs of dangerous substances that affect biodiversity, an increase of algal blooms, dead sea-beds, and the depletion of fish stocks.

http://www.newworldencyclopedia.org/entry/Fishery

http://en.wikipedia.org/wiki/Denmark

http://en.wikipedia.org/wiki/Estonia

http://en.wikipedia.org/wiki/Finland

http://en.wikipedia.org/wiki/Germany

http://en.wikipedia.org/wiki/Latvia

http://en.wikipedia.org/wiki/Lithuania

http://en.wikipedia.org/wiki/Poland

http://en.wikipedia.org/wiki/Sweden

http://en.wikipedia.org/wiki/Czech_Republic

http://en.wikipedia.org/wiki/Slovakia



FIGURE 3 BALTIC SEA

Source: Natura 2000 Viewer - EEA, 2014 (http://natura2000.eea.europa.eu)

Eutrophication is probably the worst environmental problem of the Baltic Sea. The slow rate of water passage through the narrow Danish Straits and Sound areas linking the Baltic to the North Sea is a key reason behind the sensitivity of the Baltic Sea to eutrophication because of the slow renewal of oxygen in deeper basins (Bendtsen et al., 2009). Water exchange with the oceans is thus restricted and the half-life of its water is about 25 years (Håkanson, 2011). Moreover, the vertical stratification of water averts oxygenation of the bottom waters. A well-developed agricultural sector and other human activities including fossil fuel combustion from energy production and transport contribute to significant nutrient loading (HELCOM, 2009). As shown in Figure 4, the open waters of all basins (except the Bothnian Bay and the Swedish parts of the north-eastern Kattegat) are classified as ‘affected by eutrophication’, primarily due to an increase in chlorophyll-concentrations resulting from agriculture and intensive livestock-farming releasing mineral and organic compounds in the drainage basin.



FIGURE 4

CLASSIFICATION OF EUTROPHICATION STATUS IN BALTIC SEA

Green = good status, yellow = moderate status, orange = poor status, and red = bad status. Good status is equivalent to ‘areas not affected by eutrophication’, while moderate, poor and bad

are equivalent to ‘areas affected by eutrophication’. Large circles represent open basins, while small circles represent coastal areas or stations.

Source: HELCOM, 2009 In 1974, Denmark, Sweden, Finland, the Soviet Union, Poland, and East and West Germany signed the Helsinki Commission (HELCOM), which came into force in 1980, concerning the protection of the marine environment of the Baltic Sea. HELCOM has reduced nitrogen and phosphorus discharges by 40% since the late 1980s (HELCOM, 2008). One of the main objectives of HELCOM’s Baltic Sea Action Plan (BSAP) is to reduce phosphorous discharges by another 42% and nitrogen discharges by around 18% by 2021. The transnational character of eutrophication in the Baltic Sea has led to the adoption of a European strategy for the Baltic Sea Region (EUSBSR) in 2009. The top priority is to address the problem and act in cooperation with all Member States. Specifically, EUSBSR aims at organising new projects and initiatives, creating a sense of common responsibility.



Although Belarus does not have a coast on the Baltic Sea, its nutrients flow to the Baltic Sea via trans-boundary rivers (mainly Daugava, Neman and Vistula). The trans-boundary nutrient loads from Belarus to the Baltic Sea have been estimated at 2,800 tons of phosphorus and about 44,000 tons of nitrogen per year for 2004-20114, which corresponds roughly to 10% of the total phosphorus load and to 7-8% of the total nitrogen load to the Baltic Sea5. Nutrient pollution originates mainly from agriculture and municipalities. There are 300-350 major or medium-sized point-source polluters which discharge effluents to water bodies in the catchment of the Baltic Sea, causing trans-boundary riverine discharges. Investing in the HELCOM-recommended level of wastewater purification in the largest Belarusian cities on the Baltic Sea watershed could have significant benefits (see Box 3).

4 Preliminary Assessment of the Trans-boundary Nutrients Loads from territory of Belarus to the Baltic

Sea for 2004-2011 period, Conference presentation of Aliaksandr Pakhomau, Central Research Institute for Complex Use of Water Resources, Minsk, Belarus / Baltic Compass project; Estimated total nutrient inputs at the border to downstream countries without taking into account riverine retention. 5 Baltic Sea Environment Proceedings No. 128, Fifth Baltic Sea Pollution, Load Compilation (PLC-5),

2011.

Two projects PURE and PRESTO, run by the Union of Baltic Sea Cities (www.ubc.net) and financed by the 2007-2013 Baltic Sea Region Programme, including the ENPI Programme, focus on improving the wastewater treatment plants in Brest, Baranovichi, Grodno, Molodechno, and Vitebsk and reducing by 650 tons/year the amount of phosphorus that Belarus discharges to the Baltic Sea Region. Feasibility studies show that Belarusian wastewater treatment plants have a significant nutrient load reduction potential. Investing in the HELCOM-recommended level of wastewater purification (0.5 mg/l of phosphorus and 15 mg/l of nitrogen in outgoing wastewater) in the largest Belarusian cities on the Baltic Sea watershed could reduce the phosphorus load by about 1,500 tons and the nitrogen load by 5,000 tons. Reduction of this trans-boundary load can also motivate other downstream countries to further improve their own wastewater treatment. PURE Project on Urban Reduction of Eutrophication Budget: €3.2 million (€2.6 million from ERDF and €600,000 from ENPI) Implementation time: 2009-2012 www.purebalticsea.eu PRESTO Project on Reduction of the Eutrophication of the Baltic Sea Today Budget: €4.5 million (€1.4 million from ERDF and €3.1 million from ENPI) Implementation time: 2011-2013 www.prestobalticsea.eu

BOX 3 BENEFITS TO THE BALTIC SEA FROM BELARUS, A

LANDLOCKED COUNTRY

Source: Grönholm et al., 2011

http://www.ubc.net/

http://www.purebalticsea.eu/

http://www.prestobalticsea.eu/



Black Sea

The Black Sea is bounded by Europe, Anatolia and the Caucasus, and drains through the Mediterranean into the Atlantic Ocean, via the Aegean Seas and various straits (see Figure 5). The Black Sea receives river water from large Eurasian fluvial systems to the north, of which the Don, Dnieper and Danube are the most significant. The Black Sea has a surface area of 436,400 km2 (not including the Sea of Azov), a maximum depth of 2,212 m, and a volume of 547,000 km3.

FIGURE 5 BLACK SEA

Source: Natura 2000 Viewer - EEA, 2014 (http://natura2000.eea.europa.eu)

Two EU Member States (Romania and Bulgaria) have their coastal zones along the Black Sea as well as two EaP countries (Ukraine and Georgia). Ukraine and Georgia have a combined coastline of 1,938 km, which represents almost 45% of the length of coastline around the Black Sea (see Table 7). In addition, other two EaP countries have rivers flowing into the Black Sea: Belarus and Moldova. The Black Sea is one of the most vulnerable regional seas in the world given its limited exchange of water with the open oceans and the large area of continental Europe from which it receives drainage. As a result, the Black Sea is very vulnerable to pressure from land-based human activity and its health also depends on the coastal and non-coastal states of its basin. The replenishment of waters in the Black Sea through the Bosporus is an extremely slow process. In addition, hydrogen sulphide is present in the entire lower layer of the Black Sea, which makes it the largest anoxic water basin in the world.

http://en.wikipedia.org/wiki/Eurasia

http://en.wikipedia.org/wiki/Fluvial

http://en.wikipedia.org/wiki/Don_River_%28Russia%29

http://en.wikipedia.org/wiki/Dnieper

http://en.wikipedia.org/wiki/Danube



TABLE 7

LENGTH OF COASTLINE OF BLACK SEA COUNTRIES

Country Length of coast line

(km)

Bulgaria 300

Georgia 310

Romania 225

Russia 475

Turkey 1,400

Ukraine 1,628

Total 4,338

Source: The Black Sea Commission, 2002

The four priority trans-boundary problems of the Black Sea are eutrophication/nutrient enrichment, changes in marine living resources, chemical pollution (including oil), and biodiversity/habitat changes, including alien species introduction. These issues are strongly interlinked with their underlying root causes such as industrial activities, agriculture, domestic wastewater, sea transport (oil spills, ballast water), and coastal zone degradation (urbanisation, tourism). The six coastal countries (Russia, Ukraine, Romania, Bulgaria, Georgia and Turkey) contribute about 70% of the total amount of nutrients flowing into the Black Sea in the form of waste from human activities (The Black Sea Commission, 2007). Some of this amount, and nearly all of the remaining 30% (from the countries with no direct access to the sea), enter the Black Sea through the Danube River. Eutrophication occurs over wide areas of the Black Sea. The overall yearly input of nutrients from human activity amounts to 647,000 tons of nitrogen and 50,500 tons of phosphorus (The Black Sea Commission, 2002). Large-scale eutrophication and the depletion of oxygen have caused mass mortalities of animal life within huge areas of the northwest shelf (see Figure 6). This reached a peak in 1990 when some 40,000 km² –or 80%– of the northwest shelf bed was considered to be effectively dead.

Nutrient pressures in the Danube catchment come from point and diffuse sources, reflecting the different drivers. The major point source is wastewater (treated and untreated) and the principal diffuse source is run-off of agricultural fertilisers (ICPDR, 2009). Modelling studies suggest that in the Danube catchment 86% of nitrogen emissions and 71% of phosphorus emissions now come from diffuse sources (ICPDR, 2009).



FIGURE 6 EUTROPHICATION LEVELS IN THE BLACK SEA

Source: Borysova et al., 2005

Recently there have been positive signs of Black Sea recovery (see Box 4). Earlier reductions in wastewater pollution from the upstream countries and the economic slowdown in the former communist countries were major contributors. However, agriculture is still a major activity and source of income in the lower Danube countries (O’Higgins et al., 2014). Agricultural subsidies are prevalent throughout the EU nations in the Black Sea catchment with a total of almost €32 billion paid through the Common Agricultural Policy (CAP) to Danube catchment countries between 2008 and 2010, providing a driver of eutrophication (http://farmsubsidy.org).

Pollution reduction and regulation efforts have led to a partial recovery of the Black Sea ecosystem during the 1990s, and an EU monitoring exercise, 'EROS21', has shown decreased nitrogen and phosphorus values, relative to the 1989 peak. Recently, scientists have noted signs of ecological recovery, in part due to the construction of new sewage treatment plants in Slovakia, Hungary, Romania and Bulgaria as a result of their accession to the EU. Although Slovakia and Hungary do not have any coastline around the Black Sea, they discharge wastewater into the Danube, which ends up in the Black Sea.

BOX 4 PARTIAL RECOVERY OF THE BLACK SEA

ECOSYSTEM

Source: Lancelot et al., 2002

http://farmsubsidy.org/



Oil pollution also threatens the Black Sea coastal ecosystems and the levels of

pollution are unacceptable in many coastal areas and river mouths (see Box 5). Other toxic substances such as pesticides and heavy metals appear mostly as ‘hot spots’ near well-identified sources. Another major problem is the discharge of insufficiently treated sewage waters, which results in microbiological contamination and poses a threat to public health. Last but not least, solid waste, dumped into the sea from ships and some coastal towns, is also a major problematic pollutant. The countries of the region have recognised the seriousness of water and environmental issues and have responded with national and regional strategies and reforms to

improve performance. The Convention on the Protection of the Black Sea against Pollution (Bucharest Convention) addresses these problems through enhanced cooperation among its signatories. The last Conference of the Parties adopted the Land-Based Sources and Activities Protocol and the 2009 Strategic Action Plan. Furthermore, the development/improvement of a monitoring network is considered to be a management target of high priority. Further coordination in policies and legislation among the Black Sea countries is also of common interest to the EU's partners countries (also members of the Black Sea Commission (BSC)). This will influence the ability of these countries to comply with the requirements of EU legislation and policies, notably the EU Water Framework Directive (WFD) and the EU Marine Strategy Framework Directive (MSFD), which guides future maritime policy in the EU and aims at achieving or maintaining a good environmental status (GES) of European seas by 2020. This is why the EC has funded two projects in 2013-2014: EMBLAS involving Georgia, Russia and Ukraine (see Box 6) and MISIS involving Romania, Bulgaria and Turkey (see Box 7).

Oil pollution is a concern for the Black Sea environment, in particular due to the increasing risk of accidental spills that may result from the expected twofold increase of oil transit by tankers. The freight flow of this oil resource from Middle Asia and Azerbaijan via Georgia is gradually increasing. Over 20 million tons/year of oil and petroleum products are transported via these terminals in Georgia to the west through the Black Sea. Polyaromatic hydrocarbons (PAHs) constitute a critical part of oil pollution with proven carcinogenic and mutagenic effects. In bottom sediments, the highest levels were detected near Odessa and the Danube coastline.

BOX 5 OIL POLLUTION IN THE BLACK SEA

Source: The Black Sea Commission, 2002



Responses are in place in the Danube catchment to tackle the eutrophication problem, both at the EU level and at the regional level through the International Commission for the Protection of the Danube River (ICPDR). Over €4 billion was spent to reduce eutrophication in 2000-2005 (ICPDR, 2007), primarily to improve wastewater treatment facilities (€3.7 billion). A further €6.2 billion is expected to be spent on urban wastewater treatment under the current joint Programme of measures which extends to 2015 (ICPDR, 2012). However, for nitrogen limited offshore eutrophication under the jurisdiction of the MSFD, the major driver of eutrophication is agriculture and the associated diffuse nutrient pressures has received relatively little investment in the past (€0.1 billion; ICDPR, 2007). Although legislation is in place to reduce diffuse agricultural sources of nitrogen, there are no firm budgets for reducing diffuse nutrients (ICPDR, 2012).

EMBLAS’ aim is to strengthen the capacities of Georgia, the Russian Federation and Ukraine in the biological and chemical monitoring of water quality in the Black Sea, in line with EU water related legislation. EMBLAS’ specific objectives are to improve:

The availability and quality of data on the chemical and biological status of the Black Sea, in line with expected MSFD and Black Sea Strategic Action Plan needs; and

Partner countries’ ability to perform marine environmental monitoring along MSFD principles, taking into account the Black Sea Diagnostic Report.

BOX 6 IMPROVING ENVIRONMENTAL

MONITORING IN THE BLACK SEA

(EMBLAS)

Source: EMBLAS, 2015 (emblasproject.org/)

MISIS’ overall objective is to support efforts to protect and restore the environmental quality and sustainability of the Black Sea. Its specific objectives are to:

Improve the availability and quality of the chemical and biological data provided for integrated assessments of the Black Sea State of the Environment, including pressures and impacts (in line with the MSFD);

Increase the number and size of protected areas in the Black Sea as well as their degree of protection; and

Enhance stakeholders’ participation and public awareness on environmental issues.

BOX 7 MSFD GUIDING IMPROVEMENTS IN THE BLACK SEA INTEGRATED MONITORING

SYSTEM (MISIS)

Source: MISIS, 2015 (www.misisproject.eu/)



3.2.2 Benefits from improved marine areas

The EU would benefit from improved marine areas shared with the EaP countries in many ways, including improved fisheries and other water bodies production, enhanced biodiversity, reduced drinking water treatment costs and leisure opportunities. There have been very few valuation studies to estimate the benefits of measures to mitigate eutrophication of the Black Sea. The first economic assessment of the damage caused by eutrophication in the catchment of five Southern regions in Ukraine estimates that the total value of the economic damage resulting from eutrophication is €12.9 million/year (see Table 8) and there is a need to tackle the problem at a national, regional and/or international level (Borysova et al., 2005). The study concludes that this pilot assessment is in line with the internationally-recognised assessment of environmental damage of €385 million/year (US$500 million/year) to the regional economy. Several studies have assessed the Willingness to Pay (WTP) for reducing eutrophication in the Baltic Sea. According to Hyytiäinen et al., 2013, the net benefits of the abatement measures required to reach GES in the Baltic Sea would be about €2.2 billion/year (in 2012 constant prices). This is based on a WTP survey of 10,564 people living in the nine Baltic Sea countries (Denmark, Estonia, Finland, Germany, Latvia, Lithuania, Poland, Sweden and Russia). Another WTP survey, conducted in 2006 in the Gulf of Finland, estimated an annual WTP of €210-666 per household to achieve an ambitious scenario of reduced eutrophication (Kosenius, 2010). Given that none of the EaP countries borders the Baltic Sea, and that only two EaP countries (Belarus and Ukraine) have rivers that flow into the Baltic Sea, any improvement in the water quality of these rivers will have a limited impact on the quality of the water in the Baltic Sea. For the Black Sea, given that the main contributors to the Black Sea’s environmental problems are the rivers flowing into it, better water quality of these rivers would substantially benefit the Black Sea. The estimates in Section 3.1 already include to a large extent the benefits that the EU would derive from a better marine environment in the Black Sea.



TABLE 8

ESTIMATED DAMAGE FROM EUTROPHICATION IN UKRAINE

Main damage indicator

Estimated amount

US$ million € million

1. Reduced commercial values of the water bodies (fisheries and other water bodies products)

0.41 0.32

2. Reduced biodiversity of the water bodies 10.78 8.29

3. Increased costs of drinking water treatment 1.36 1.05

4. Clean-up costs of waterways (dredging, weed-cutting) 0.038 0.029

5. Reduced recreational and amenity value of water bodies for water sports (bathing, boating, windsurfing, canoeing), angling, and general amenities (picnics, walking, aesthetics)

0.81 0.62

6. Net economic losses for commercial aquaculture and shellfisheries

0.05 0.04

7. Negative ecological effects on biota (arising from changed nutrient status, pH and oxygen content of water), resulting in both changed species composition and loss of key or sensitive species

3.24 2.49

8. Costs of legislation compliance arising because of negative impacts of nutrient enrichment

0.14 0.11

TOTAL 16.828 12.945

Conversion: €1 = $1.3

Source: Borysova et al., 2005



Monetised trans-boundary benefits, according to reduced pulmonary and cardiovascular illness –based on ten Brink et al., 2011– and adjustment based on common border length:

€2.6 billion per year starting in 2020

Some uncertainties in the benefit estimates due to the transfer of results from

previous studies (e.g., in epidemiological exposure-response functions and monetary valuation) and to the air quality modelling limited to a select number of pollutants

3.3 Air quality


Air quality is currently a significant environmental hazard in EaP countries, particularly in large cities (ten Brink et al., 2011). Air pollution has a wide range of negative impacts especially on human health (e.g., pulmonary and cardiovascular illness and early mortality). Premature mortality and diseases associated with air pollutants are much higher in the EaP countries than in Western Europe (see Figure 7). Air pollution also causes socioeconomic and environmental problems and can damage ecosystems, crops and buildings, including cultural heritage.

FIGURE 7 DISABILITY ADJUSTED LIFE YEARS (DALYS) ATTRIBUTED TO URBAN PM10 POLLUTION

Source: UNEP, 2007



Air pollutants are emitted by either stationary sources, such as coal-fired power plants or industrial facility stacks, or by moving sources such as cars, buses, lorries, and rail and ship transport. Emitted pollutants have different residence times6 and are transported over varying distances, affecting the extent of their impact (see Figure 8). Substances with very short residence times (such as SO2, NO2 and PM10) affect mainly indoor and local air quality. Substances with a residence time of days to weeks (such as SO4

2-, NO3- and PM2.5) create local and regional problems. Those with residence

times of weeks to months (such as the tropospheric ozone) result in continental and hemispheric problems, while those with residence times of years (such as CO and CO2) give rise to global problems.

FIGURE 8 AVERAGE RESIDENCE TIMES IN THE ATMOSPHERE OF SELECTED POLLUTANTS AND

MAXIMUM EXTENT OF THEIR IMPACT

Source: UNEP, 2007

The Chernobyl accident is a good illustration of how far radioactive materials can travel. On 26 April 1986, a catastrophic nuclear accident occurred in the Chernobyl Nuclear Power Plant in Ukraine and released large quantities of radioactive particles into the atmosphere, which spread over much of the western USSR and Europe (see Box 8).

6 Residence time: time during which a pollutant stays in the atmosphere.

http://en.wikipedia.org/wiki/Catastrophic_failure

http://en.wikipedia.org/wiki/Nuclear_and_radiation_accidents

http://en.wikipedia.org/wiki/Chernobyl_Nuclear_Power_Plant

http://en.wikipedia.org/wiki/Chernobyl_Nuclear_Power_Plant

http://en.wikipedia.org/wiki/Europe



With funding from the European Commission, an atlas was published in 1998 showing the largest quantities of Caesium-137 deposited in the various European countries based on the data provided by these countries (see map below). Clearly, Ukraine, Belarus and Russia received the highest quantities of radioactive particles –about 60% of the total quantity of radioactive particles emitted. These countries have large surface areas (about 150,000 km²) with deposits of Caesium-137 over 40,000 Bq/m². There are also deposits of Caesium-137 over 40,000 Bq/m² in the south of Finland, the centre and the east of Sweden, the centre of Norway, the south of Romania, Slovenia, the border between Poland and the Czech Republic, Switzerland, Austria and the north of Greece.

BOX 8 SPREAD OF RADIATION FROM CHERNOBYL ACCIDENT

Source: Rekacewicz, 2007

In 2005, EaP countries emitted 5.6 million tonnes of pollutants with a local and regional impact, namely Ammonia (NH3), Non-Methane Volatile Organic Compounds (NMVOC), Nitrogen Oxides (NOx), Particulate Matter (PM2.5, PM10, PMco

7) and Sulphur Dioxide (SO2) (see Table 9).

7 PMco (Coarse Particulate Matter) is defined as the difference between PM10 and PM2.5.



TABLE 9 AIR POLLUTANTS EMITTED (1,000 TONNES) BY EAP COUNTRY IN 2005

EaP country NH3 NMVOC NOx PM2.5 PMco PM10 SO2 Total


Belarus 165 366 84 29 14 43 134 835

Moldova 21 73 14 25 21 46 7 207

Ukraine 306 838 544 305 202 507 863 3,565

Southern Caucasus

group

Armenia 17 101 6 16 10 26 8 184

Azerbaijan 64 318 76 18 9 27 135 647

Georgia 39 68 16 7 3 10 5 148

Total 612 1,764 740 400 259 659 1,152 5,586


This study has used the methodology described in the Benefit Assessment Manual to estimate future emissions of pollutants (Bassi et al., 2011). Accordingly, in 2020, the EaP countries are expected to emit nearly 8 million tonnes of these same pollutants (see Table 10), an increase of over 2 million tonnes compared to 2005. Ukraine is the country with the highest quantity of emissions (64% of the total) (for further details, see Annex IV).

TABLE 10 AIR POLLUTANTS EMITTED (1,000 TONNES) BY EAP COUNTRY IN 2020

EaP country NH3 NMVOC NOx PM2.5 PMco PM10 SO2 Total


Belarus 236 523 120 41 20 61 192 1,194

Moldova 30 104 20 36 30 66 10 296

Ukraine 438 1198 778 436 289 725 1,234 5,098

Southern Caucasus

group

Armenia 24 144 9 23 14 37 11 263

Azerbaijan 92 455 109 26 13 39 193 925

Georgia 56 97 23 10 4 14 7 212

Total 875 2,523 1,058 572 370 942 1,647 7,988

Source: STELLA Consulting’s estimates based on Bassi et al., 2011

3.3.2 Benefits from improved air quality

Air pollution modelling in Europe has repeatedly shown that –due to their dispersion by atmospheric wind currents– the emission of pollutants in one country may result in significant impacts in other countries within certain geographical areas. Air pollutant emissions reductions would provide significant benefits to human health (pulmonary and



cardiovascular illness), which account for around 90% of the total benefits (ten Brink et al., 2011). A reduction in emission levels would also yield environmental and socio-economic benefits, such as increased crop yields, and reduced the soiling of buildings. To achieve such benefits, improved air quality compliance in the EaP countries is necessary, along with the approximation of the national air pollution legislation to the EU standards, as promoted by the Air Quality Governance project in 2011-2014 (see Box 9).

BOX 9 AIR QUALITY GOVERNANCE IN ENPI EAST COUNTRIES

Source: EU Neighbourhood Info Centre, 2014 (www.enpi-info.eu)

This study has estimated the benefits to the EU assuming that the trans-boundary benefits are proportional to the common border length (see methodology in Annex V). This study considers trans-boundary benefits only for the EaP Eastern Europe group of countries as the EaP Southern Caucasus group of countries is too distant from most of the EU-28 to benefit from any measurable impact. In 2020, the monetary benefits to the EU of improved air quality in the EaP countries could reach €2.6 billion per year, provided the emissions of the pollutants are 50% less than their current levels (see Table 11). Most of the benefits (€2.25 billion) come from reductions in Ukraine. The benefits accrue to four categories: mortality (70% of the total), morbidity (20%), crops (6%) and building materials (4%). These results are indicative, as trans-boundary benefits are difficult to calculate; however, they serve to demonstrate the potential importance of such benefits. These results validate previous monetary estimates made in the region and showing that total damages from air pollution amount to about 4% of GDP.

Project: Air Quality Governance in ENPI East countries Timeframe: 2011-2014 Location: Armenia, Azerbaijan, Belarus, Georgia, Moldova, Russia, Ukraine Budget: € 7 million Financial source: EC By supporting the participating countries in improving their convergence with European legislation and regulations, the project contributed to improved air quality, strengthened implementation and compliance, and improved the implementation of multilateral environmental agreements. It also raised environmental awareness through cooperation at national and regional levels among decision makers, industry and civil society.



TABLE 11 AIR QUALITY TRANS-BOUNDARY BENEFITS TO THE EU IN 2020


Total trans-boundary benefits

(€ million PPP8)

Total border

length (km)

Common border length with EU

Trans-boundary benefits to the EU

(€ million PPP) (km) (%)

Belarus 603 3,306 1,456 44 266

Moldova 280 1,390 450 32 91

Ukraine 9,499 5,581 1,324 24 2,253

Total 2,610

Source: STELLA Consulting’s estimates based on ten Brink et al., 2011

On the other hand, there are some uncertainties in the estimates of these benefits. Some of them are due to the transfer of results from previous studies (e.g., in epidemiological exposure-response functions and monetary valuation) that were undertaken in non-EaP countries. Similarly, the air quality modelling is limited in the number of pollutants incorporated and does not include NO2, heavy metals, PAHs, etc. Potentially important impact categories that are not considered quantitatively include negative impacts to ecosystems. In 2020, the domestic benefits (i.e., benefits realised in the individual countries in which the emissions are being reduced) in the three countries of the Eastern Europe group could be about €9.2 billion per year (see Table 12). It is interesting to note that the domestic benefits for Ukraine (€6.650 billion) are only two-thirds of the trans-boundary benefits for Ukraine (€9.499 billion).

TABLE 12 AIR QUALITY DOMESTIC BENEFITS IN 2020


Total domestic benefits (€ million PPP)

Belarus 2,306

Moldova 253

Ukraine 6,650

Total 9,209


8 Purchasing Power Parity (PPP equates the purchasing power of different currencies).



These results reflect patterns of economic activity in these EaP countries, including their industrial composition, the proximity of population centres to large polluting enterprises, and patterns of car ownership and the age and maintenance regimes of such vehicles. These results therefore suggest that –as being initiated in many of these countries– future regulation should address both stationary (i.e., point, sources) and non-stationary (i.e., transport, sources) and consider technological options as well as spatial planning. Future research should focus on more detailed, context-specific modelling of the air quality impacts, as well as using this information to conduct cost-benefit analyses of alternative air quality regulatory strategies.



The EaP Eastern Europe group (Belarus, Moldova and Ukraine) shares several protected areas with the EU-28

There are some isolated examples of cross-border cooperation for the elaboration of management plans for protected areas

Only Armenia and Azerbaijan have adopted the target proposed by the Convention on Biological Diversity (CBD): 17% of terrestrial and inland water bodies should be protected areas by 2020

3.4 Biodiversity

Biodiversity is a source of natural resources and agricultural production; it is also of immense intrinsic value and human well-being depends upon it. Genetic, species and ecosystem diversity is a ‘natural capital’ that provides a country, its economy and its people with a flow of goods and services that are fundamentally important for prosperity, livelihoods and well-being (ter Brink et al., 2011). For example, the EU and the EaP countries have a large number of plant and animal species in common; they must join efforts across their borders to achieve and maintain a ‘favourable conservation status’ for all species, and in particular those that are threatened.


The status of biodiversity is poorly known in much of the EaP region. However, recent initiatives --such as the Emerald network (see Box 10 and Annex VI) or the Convention on Biological Diversity (CBD) National Reports-- are helping to assess the state of natural habitats and the associated flora and fauna, as well as proposing protected areas coherent with the Natura 2000 network. It is however clear that there is on-going degradation of most ecosystems across the EaP countries, and many associated species are in decline. Consequently, a substantial number of species are threatened nationally, some of which are also at risk of global extinction (see two examples in Figure 9). Some countries have created Red Books to identify and protect rare and endangered species of wild animals and plants. For example, the Red Book of Belarus contains 188 species of fauna and 274 species of plants and mushrooms (MNRE, 2014) and the Red book of

The EU is a Contracting Party to the Convention on the Conservation of European Wildlife and Natural Habitats (or Bern Convention) that came into force on 1 June 1982. To fulfil the obligations arising from the Convention, the EU has set up the Natura 2000 network (based on the Habitats and Bird Directives). As part of its work under the Bern Convention, the Council of Europe launched the Emerald Network in 1988. The Emerald Network is based on the same principles as Natura 2000 and represents its de facto extension to non-EU countries; it is an ecological network that conserves wild flora and fauna and their natural habitats.

BOX 10 EMERALD NETWORK

Source: Obretenova et al., 2014



Azerbaijan has identified 338 species of higher plants, 12 species of fungi, 23 species of lower plants and 223 species of fauna (MENR, 2014).

FIGURE 9 BLACK STORK (CICONIA NIGRA) AND EUROPEAN BISON (BISON BONASUS): ENDANGERED

SPECIES IN AZERBAIJAN AND BELARUS RESPECTIVELY

Source: Environmental Atlas of Europe - UNEP-EEA-ESA, 2014 (www.eea.europa.eu/atlas/eea)

The main threats to biodiversity in the region include (ten Brink et al., 2011):

- Logging of natural / near-natural forest and expansion of commercial forestry;

- Overgrazing and desertification;

- Expansion of agricultural

land and agricultural intensification;

- Wetland drainage;

- Pollution;

- Illegal hunting (see Box 11)

and overexploitation of some species, especially fish; and

- Spread of invasive species

(see Box 12).

BOX 11 THE IMPACTS IN HUNGARY OF SHOOTING THE

RED-FOOTED FALCON IN UKRAINE

The Red-footed Falcon (Falco vespertinus) is protected by the Birds Directive (included in Annex I). The species is “Near Threatened” according to IUCN; it is legally protected in all EU range states and in most of the breeding range countries, except in Ukraine. In 2009, a national scale survey conducted in Ukraine estimated a population decline of 23% compared to 1990-2000. Persecution in the breeding range may be direct (illegal shooting and or disturbance) or indirect (persecution of rooks). Although, Red-footed Falcons are not a hunted species, shooting is reported in Ukraine. The scale of shooting is not known, but it should not be underestimated and is qualified as ‘High’ by Ukrainian ornithologists. Two out of eight satellite tagged individuals from Hungary were located in the southern part of Ukraine for more than a month before the autumn migration, suggesting that shooting in the area may have an impact on the breeding population of EU range states as well.

Source: Palatitz et al., 2009



BOX 12

SPREAD OF HERACLEUM SOSNOWSKYI IN EAP COUNTRIES AND THE EU

Source: EPPO, 2009

One of the main ways of protecting biodiversity resources is to protect areas of high biodiversity that are at risk of degradation. Ecological networks of protected areas can positively influence the conditions for the survival of species populations in Europe’s fragmented natural areas and human dominated landscapes. They also allow a suitable and sustainable use of natural resources by interconnecting their physical elements with the landscape and existing social/institutional structures. The CBD recognises the role of protected areas. According to the CBD’s Strategic Plan for Biodiversity 2011-2020 and its Aichi Targets, at least 17% of terrestrial and inland water bodies and 10% of marine areas should be protected areas by 2020. Out of the six EaP countries, only Armenia and Azerbaijan have adopted the 17% target proposed by the CBD (see Table 13). On the other hand, the Emerald project has proposed several sites for the network; this is an ongoing exercise and data are not definitive (for further details, see Annex VI).

Heracleum sosnowskyi (Sosnowsky’s hogweed) is native to the Eastern and Central Caucasus, Central, Eastern and South-Western Transcaucasia, and N.E. Anatolia in Turkey. It was introduced into North-West Russia at the end of the 1940s in experimental farms as a potential forage crop. From the 1960s, it was cultivated for forage over wider areas in Russia, Belarus, Ukraine and the Baltic States. It was also tested in the former German Democratic Republic, Hungary and Poland. It is an undesirable invader on account of its large size, prolific seed production and vigorous growth leading to gross changes in vegetation, obstruction of access to riverbanks and soil erosion. In 2008, Latvia detected 7,956 ha of territories invaded by H. sosnowskyi. Cultivation of H. sosnowskyi as a forage plant was eventually abandoned in the Baltic States at the end of the 1980s as agricultural production systems and markets changed, partly because the aniseed scented plants affected the flavour of the meat and milk of the animals to which it was fed, and partly because of the health risk to humans and cattle. The plant is a close relative of the giant hogweed and contains extremely large amounts of furocoumarins, which are typically produced by Apiaceae. These substances are carcinogenic and make the skin extremely light sensitive. In its 2012 list of invasive alien plants, the European and Mediterranean Plant Protection Organisation (EPPO) described the giant hogweed as the most economically-damaging invasive plant and as a high priority internationally, whilst it has been recommending the introduction of plant health regulations to counter the threat posed by Sosnowsky's hogweed since 2009.



TABLE 13 PROTECTED AREAS AND PROPOSED EMERALD SITES IN EAP COUNTRIES

EaP country

National protected sites in 2014* (% country

coverage)

National targets for protected sites

in 2020 (% country coverage)

Proposed Emerald sites in 2014

Nº of sites

Total area (ha)

% country coverage


Belarus 7.7 8.3 16 980,626 4.7

Moldova 5.6 8.0 18 388,465 11.5

Ukraine 5.0 Unknown 159 4,469,530 7.4

Southern Caucasus

group

Armenia 13.0 17.0 13 296,326 9.9

Azerbaijan 10.3 17.0 12 845,538 9.7

Georgia 7.5 12.0 21 919,934 13.2

Total / Average 8.2 12.5 239 7,900,419 9.4

* Belarus: 2011, Moldova: 2013, Ukraine: 2009, Armenia-Azerbaijan-Georgia: 2014.

Sources: MNRE, 2014. MNP, 2014. ME, 2013. MEP, 2010. MENRP, 2014. MENR, 2014. Obretenova et al., 2014.

Designating protected areas is not sufficient to conserve biodiversity within the sites. The elaboration of management plans is equally if not more important; the level of implementation of such plans is rather limited in the EaP countries. However, there are exceptions. For example, Polish and Belarus authorities have worked together on managing the Belovezhskaya Pushcha / Białowieża forest (located in Belarus and Poland) where they have successfully reintroduced the European bison (Bison bonasus), a species protected by the Habitats Directive (see Box 13). The forest is one of the last and largest remaining parts of the immense primeval forest that once stretched across the European Plain; it has been designated a UNESCO World Heritage Site, a UNESCO Biosphere Reserve, and an EU Natura 2000 SCI and SPA.



BOX 13 SUCCESSFUL REINTRODUCTION OF THE BISON IN BELARUS AND POLAND

Sources: World Heritage Information Sheets, 2013 (http://old.unep-wcmc.org/world-heritage-information-

sheets_271.html); World Database on Protected Areas - IUCN & UNEP, 2014 (http://www.protectedplanet.net); EUNIS, 2015 (http://eunis.eea.europa.eu/species/11241)

The European bison (Bison bonasus) is protected by the Habitats Directive (included in its Annex II). The bison is rare and threatened in Europe; its current conservation status is “Unfavourable-Inadequate”. The species is present in only 14 Natura 2000 sites. The Belovezhskaya Pushcha / Białowieża forest (a trans-boundary area in Belarus and Poland) is in the watershed between the Baltic and the Black Seas. This immense and relatively undisturbed forest of evergreen and deciduous broad-leaved trees is the last large primary temperate forest in lowland Europe and one of its largest biodiversity reserves. It contains several rare species of mammal such as wolf, elk and lynx; it is also home to the European bison. The bison was reintroduced in 1929; now there are over 315 animals on the Belorussian side. In 1952, the bison was reintroduced into forest areas outside the fenced reserve; at present, 260 bison range freely on the Polish side.

Shared protected area of Białowieża forest (Poland/Belarus)

Since 1991, Polish and Belarus authorities have worked together on management issues and the Director of the Belarussian Park is a member of the Scientific Council of the Polish Bialowieza National Park. Between 1992 and 1996, the National Park was the subject of a trans-boundary Forest Biodiversity Protection Project funded by the Global Environmental Facility. The project aimed at supporting research culminating in land use plans, involving local people in the management and benefits of the area and introduced a Geographical Information System. A bilateral trans-boundary cooperation agreement between the two national park authorities in November 2006 prioritised the conservation of the forest’s biodiversity and its use for educational and recreational purposes. In 2004, the 75th anniversary of the reintroduction of the bison, the Year of the Bison was celebrated with many promotional and conservation activities. Chief among these, urged by a 2003 IUCN and UNESCO Mission, was to achieve an integrated trans-boundary management plan for both sectors, incorporating improved practices for managing the core area and the adjacent forests. The greatest danger to the forest comes from large-scale government-sponsored commercial logging, which is intensifying its fragmentation.



3.4.2 Benefits from improved biodiversity

Benefits to the EU resulting from an improved situation for biodiversity resources in the EaP countries would be tangible. Political boundaries rarely coincide with natural boundaries thus a pan-European approach is necessary for the successful conservation of species and habitats, especially for the endangered biodiversity and the migratory species (see Box 14). It is also essential for addressing shared problems such as invasive alien species. However, due to the complexity of the issues, it is not possible to quantify the benefits with accuracy. These trans-boundary benefits would have a stronger impact in the EU-28 from improvements in the EaP Eastern Europe group since Belarus, Moldova and Ukraine share borders and several protected areas with the EU-28. This confirms the importance of the Emerald network, which is committed to integrate protected trans-boundary areas (see Annex VI).



BOX 14 CONSERVATION OF THE SAKER FALCON (FALCO CHERRUG) IN THE EU AND IN UKRAINE

Sources: LIFE+ Programme, 2014 (http://ec.europa.eu/environment/life/project/Projects/index.cfm);

Fidloczky et al., 2014; Prommer et al., 2012

The Saker Falcon occurs in a wide range across the Palearctic region from Eastern Europe to western China. The global population size remains subject to considerable uncertainty; however, a total population of 6,400-15,400 pairs (median 10,900) is estimated for 2010. The populations in Europe, and probably in Mongolia, are now increasing, but the overall population trend is estimated to be negative. Hungary and Slovakia are home to 450 pairs and the Saker population in the Ukrainian steppe zone can be assessed to 285-312 pairs. The species is in Annex I of the Convention on the Migratory Species (or Bonn Convention), Annex I of the EU's Bird Directive, Annex II of CITES and it is classified as 'Endangered' on IUCN's Red List; it is listed in Ukraine’s Red Data Book as “Vulnerable” and hunting is “strictly protected” by the law. The Saker Falcon is also legally protected in almost all across its range states; however, legal protection does not guarantee the effective and efficient conservation of the species if there is no efficient law enforcement. Two recent initiatives have aimed to stabilise and further strengthen the European core populations of the Saker Falcon:

A LIFE+ project (2010-2014) has implemented best practices for conserving the species in Bulgaria, Romania, Hungary and Slovakia. The project also involved other countries such as Ukraine with site visits and knowledge exchange. The project has provided important new information about the risks, survival rate, migration and roaming patterns of juveniles. Roaming behaviour of juvenile falcons has been mapped to reveal a very wide catchment, ranging from Spain to Kazakhstan.

Experts from Ukraine and Hungary have prepared a conservation plan that shows decision-makers the most important measures to be taken for various regions of Ukraine; the plan is based on the latest information about the species partly from projects in Ukraine, partly from other countries.

Satellite-tracking of central European Saker Falcons



Significant problem with industrial and hazardous waste, such as obsolete agrochemicals from Soviet times; current efforts from Moldova and Ukraine to eliminate stockpiles of obsolete pesticides

Steady increase of municipal solid waste (MSW) generation due to urban growth and economic development

EU companies could expect eco-exports of €10-12.8 million per year to support waste management in EaP countries

3.5 Waste management


Municipal solid waste (MSW), industrial waste and hazardous wastes (e.g. sludge from mining and enrichment industries, obsolete agrochemicals from Soviet times) pose significant problems in EaP countries. Waste management is generally inadequate, which leads to significant environmental and health problems (ten Brink et al., 2011). However, despite these serious impacts, data on the types and quantities of waste ‘stored’ in the environment are poor. In addition, management methods are fragmented (Aspleaf et al., 2013). Industry in the region is currently little engaged in waste management: industries often stock the waste on their sites on adjacent land rather than recycling or disposing via due legal and sanitary means. Extended Producer Responsibility for products that have come to the end of their useful life has not yet been introduced in the region.

Municipal Solid waste

MSW generation has increased steadily in the EaP countries due to urban growth and economic development. In Azerbaijan, for instance, the estimated volume of MSW increased from 4.6 million m3 in 2000 to 9.3 million m3 in 2009 (Nunes et al., 2011). The estimate for 2020 (see Table 14) assumes that the average waste generation per capita grows in line with the economic growth (Bassi et al., 2011)9.

9 The assumption that waste generation is proportionally coupled to GDP is based on the so-called

Environmental Kuznets, which is based on the empirical finding that the environmental impact (or its sources such as waste generation) increases in line with economic growth; after a while, however, the environmental impact stabilises or even starts to decrease.



TABLE 14 MUNICIPAL SOLID WASTE GENERATION IN EAP COUNTRIES

EaP country

MSW generation (tonnes/year)

Current* Estimation for

2020


Belarus 3,757,939 7,382,635

Moldova 2,332,569 2,865,165

Ukraine 9,726,258 23,817,341

Southern Caucasus

group

Armenia 368,618 1,324,849

Azerbaijan 1,620,902 3,788,140

Georgia unknown 961,209

* Belarus: 2005, Moldova: 2013, Ukraine: 2007, Armenia: 2007, Azerbaijan: 2011

Sources: Waste Atlas, 2014 (http://www.atlas.d-waste.com/) and ten Brink et al., 2011

Nearly all collected MSW goes to non-managed dumpsites (ten Brink et al., 2011) and only in a few cases does it go to sanitary landfills. More environmentally friendly management solutions such as recycling, composting and incineration are currently underdeveloped. Waste is generally not collected separately, although there are some exceptions. Considerable amounts of waste are therefore dumped or burned in an uncontrolled way. None of the EaP countries has full waste collection coverage, especially in rural or less densely populated areas, which leads to illegal dumping or unauthorised burning. In addition, the current shift in consumption patterns (e.g., widespread use of plastics and hazardous substances) has brought new problems to rural areas, where the level of waste reuse has been traditionally high.

Industrial and hazardous waste

Industrial and hazardous waste, such as obsolete agrochemicals from Soviet times or sludge from mining and enrichment industries, is a serious problem. For example, Persistent Organic Pollutants (POPs) --toxic chemicals that resist environmental degradation and pass from one species to the next through the food chain-- have significant adverse effects on human health and the environment. They are transported by wind and water, and therefore POPs generated in one country can and do affect people and wildlife in neighbouring countries. Many POPs are currently used as pesticides, or were so in the past. Nowadays, obsolete pesticides pose a significant concern in the EaP countries, stemming from overuse and mismanagement during the Soviet era. Around 200,000 tons of obsolete pesticides (about 40% of the world's stockpiles) are found in the 12 former Soviet Union republics, including all of the EaP countries (see Figure 10). They are kept in tens of thousands of unprotected sites and pose a serious threat to people’s health and the environment.



FIGURE 10 OBSOLETE PESTICIDES IN EAP COUNTRIES IN 2013

Source: IHPA, 2015

POPs in non-EU countries pose an imminent risk for the EU because stocks are often stored near watercourses. POPs risk being washed into rivers, especially in times of floods, such as recent ones in Germany (2002) or in Romania, Ukraine and Moldova (2008) (CEPS, 2009). The Stockholm Convention on Persistent Organic Pollutants (2001) stated the intention of the international community to eliminate or severely restrict the production of POPs. The largest quantity of obsolete pesticides is in Ukraine. However, Moldova and Georgia have the largest quantity per person –more than twice the amount in Ukraine (see Table 15)-- due to high pesticide use in the past. Studies have shown conclusively that these materials have contaminated the sites and surrounding soils and nearby surface waters (Mehmetli et al., 2007).

0 5,000 10,000 15,000 20,000 25,000

Belarus

Moldova

Ukraine

Armenia

Azerbaijan

Georgia

7,950

4,900

24,500

864

11,000

6,470

(metric tonnes)



TABLE 15 OBSOLETE PESTICIDES BY EAP COUNTRY IN 2013

EaP country Metric tonnes Kg/person


Belarus 7,950 0.84

Moldova 4,900 1.38

Ukraine 24,500 0.54

Southern Caucasus

group

Armenia 864 0.29

Azerbaijan 11,000 1.17

Georgia 6,470 1.45

Source: Leonchikova, 2013 (https://obsoletepesticides.net/site/)

To date, with the help of the World Bank, Moldova has eliminated 1,300 tonnes of POP pesticides (see Box 15). In Ukraine, efforts are ongoing to export 1,000 tonnes of POPs to Germany for destruction and the elimination of a further 2,000 tonnes is already planned (CEPS, 2009).

BOX 15 SAFE DISPOSAL OF HARMFUL CHEMICAL SUBSTANCES IN MOLDOVA

In 2005-2010, Moldova reduced obsolete pesticide stocks by about 30 percent and eliminated 85 percent of Polychlorinated Biphenyls (PCBs) contaminated electrical equipment. In addition, the country established a set of fundamental legislative and operational principles for a modern, risk-based chemical management system. Moldova had used extremely high amounts of pesticides before independence in 1991, leading to a build-up of stockpiles of obsolete pesticides. In addition, during Soviet times, it was a hub for energy exports to Bulgaria and transmission equipment was contaminated with high amounts of PCBs. These substances are hazardous and represent a threat to public health and the environment. In 2004, Moldova joined the Stockholm Convention, committing itself to the elimination of Persistent Organic Pollutants (POPs) substances and requested assistance from the Global Environment Facility (GEF) to meet its obligations under the Convention as well as local legislation. As a GEF implementing agency, the World Bank assisted the Government of Moldova in preparing and implementing a GEF-financed project in support of the country’s POPs National Implementation Plan (NIP). Between December 2005 and December 2010, the US $13.41 million project:

Safely re-packaged, transported, and incinerated 1,293 tons of stockpiled obsolete pesticides from 13 warehouses –35% reduction in the country’s obsolete pesticide stocks;

Safe liquidated and disposed of 934.3 tons of PCB contaminated matter (equipment and soil)– 85% reduction in PCB contamination;

Established a PCB inventory registration system and national database which have strengthened the country’s capacity for a targeted and risk-based management of remaining contaminated sites and equipment;

Improved the country’s legislative and regulatory framework which set the stage for a modern chemical management system; and

Increased public awareness of health and environmental hazards from POPs.

Sources: World Bank News, 2013 (http://go.worldbank.org/PR11FUQ210)



Waste electrical and electronic equipment (WEEE)

Waste electrical and electronic equipment (WEEE) is one the fastest growing waste streams in the EU-28, with about 10 million tonnes generated in 2012 and expected to grow to more than 12 million tonnes by 2020. Until recently, the quantities of WEEE in the EaP countries were relatively small due to the low level of consumption and social tendency to keep old or defective equipment (e.g., computers, television sets, refrigerators and mobile phones). There is strong correlation between the amount of WEEE generated per person and the GDP of the country. Therefore, as the GDP of the EaP countries increases, the quantities of WEEE will also increase. Belarus and Azerbaijan are the two EaP countries that generated the largest quantities of WEEE per person in 2012. In fact, Belarus generated more waste than either Bulgaria and Romania did (see Table 16).

TABLE 16 WEEE BY EAP COUNTRY IN 2012

EaP country Estimated WEEE* GDP/capita

(EUR) metric kilo tonnes Kg/person


Belarus 88.32 9.41 €5,827

Moldova 7.34 2.06 €1,715

Ukraine 201.76 4.45 €3,000

Southern Caucasus

group

Armenia 11.09 3.30 €2,696

Azerbaijan 57.59 6.26 €6,009

Georgia 15.54 3.45 €2,771

Bulgaria 60.90 8.36 €5,613

Poland 472.60 12.36 €10,332

Romania 160.84 7.53 €7,307

EU-28 9,918 19.26 €26,341

*The estimate is based on the lifetime of EEE and volumes placed on the market (POM); in countries

where POM is not known, a correlation of POM to GDP is assumed. Source: StEP Initiative, 2012 (http://step-initiative.org/index.php/WorldMap.html)

WEEE is not currently managed properly in the region as there is a lack of unified legislation. As a result, heavy metals pollute the environment and have a negative impact on human health (due to toxic substances from burning and decomposition of EEE).

3.5.2 Benefits from improved waste management

The overall solid waste projection for 2020 gives rise for concern, as trends show an increase in waste generation and a complex and ineffective institutional framework.



Most of the EaP countries have significant legislation but it remains largely declaratory, and regulations and rules are rarely transformed into verifiable, on the ground, actions that are implemented nationwide. The challenge is to reduce the growth in waste (i.e., prevention of waste) and then, following the waste hierarchy, to duly reuse/recycle waste and then finally to dispose of it correctly. Improvements in waste management in the EaP countries could have a substantial positive impact. The most important benefits relate to environment and health (e.g., avoided birth defects and various diseases, avoided groundwater pollution, etc.). Such benefits would be mainly domestic, although the EU would benefit in certain cases (e.g., trans-boundary aquifers), especially if improvements take place in neighbouring countries (i.e., the EaP Eastern Europe group of countries). The largest cities of the EaP countries have already taken the first steps to achieve good waste management standards. Various international projects have also helped the EaP countries to move in the right direction (see Box 16). This study has quantified the potential business opportunities in the EU to support the waste management industry in EaP countries. Since EU companies have a global comparative advantage in terms of waste management (Rademaekers et al., 2012), the EU private sector is well positioned to capture a share of the future market. As explained in Section 3.6 below, EU eco-exports to the EaP countries could reach €51 million per year starting in 2020. Given that waste management represents the largest share (20-25%) of the total global market of eco-industries (Rademaekers et al., 2012), this means that EU companies could expect eco-exports of €10-12.8 million per year to support waste management in EaP countries.

BOX 16

WASTE GOVERNANCE IN THE ENPI EAST

Project: Waste Governance in the ENPI East Timeframe: 2009-2013 Location: Azerbaijan, Armenia, Belarus, Georgia, Moldova, Russia and Ukraine Budget: € 5.8 million Financial source: EC The project improved waste management by promoting higher standards at waste facilities, more effective waste prevention initiatives, increased capacities for waste collection and sorting, as well as increased reuse, recovery and safe disposal of waste. Working in one pilot region per country, the project promoted more sustainable consumption and production patterns in the partner countries to ensure a more holistic approach to minimising environmental impacts and maximising social benefits. Actions in brief:

Made an inventory of illegal waste disposal sites, developed waste forecasts, outlined ways of strengthening the institutional framework;

Reviewed current waste classification practices and identified alternative approaches;

Developed action plans for upgrading statistical data collection;

Developed waste management strategies for pilot regions;

Developed a platform for further investments in the waste sector; and

Organised training and raised awareness in the waste governance sector.

Source: Aspleaf et al., 2013



Monetised trans-boundary benefits (14% of external eco-trade equal to 4.1% of eco-market in EaP countries):

€51 million per year and 434 jobs starting in 2020

No strong evidence that relatively high environmental standards lead to loss of international competitiveness

3.6 Trade

More stringent environmental regulations in the EaP countries will require additional investments in pollution prevention and abatement technologies that may not be available in the EaP countries and that may have to be imported from various countries in the world, including the EU Member States. Therefore, trade is expected to increase between the EU and EaP, thus strengthening:

The eco-industry, defined as the "producer” of goods and services that measure, prevent, limit, minimise or correct environmental damage to water, air and soil, as well as problems related to waste, noise and ecosystems. This includes technologies, products and services that reduce environmental risk and minimise pollution and resources. It is possible to estimate the size of this EaP eco-industry by extrapolating previous studies and then to estimate the market share that the EU may be able to capture.

The level playing field between EaP and EU companies, i.e., production costs in EaP countries will increase and be comparable to production costs in the EU, which will increase the competitiveness of EU companies on the EaP market.

This chapter covers these two trade issues in the following two sections.

3.6.1 Eco-industry

The eco-industry has been addressed in studies which use a statistically delineated definition relying heavily on Environmental Protection Expenditures (EPE). Eurostat defines EPE as follows:

“… the money spent on all purposeful activities directly aimed at the prevention, reduction and elimination of pollution or nuisances resulting from the production processes or consumption of goods and services... Taking into account the limitations that occur due to data availability, the indicator environmental protection expenditure (EPE) that can be found in the data base includes total investments and total current expenditure.”



This study also relies on EPE to assess the six EaP countries’ eco-industry. The UNECE reports on Environmental Performance Reviews (EPR) provide data on past EPE in the six EaP countries, but over a period of 14 years (from 1998 for Armenia to 2013 for Moldova, see Table 17), which makes any comparison difficult. In addition, the EPE are often incomplete and do not include total expenditures. For example, Moldova is the country with the most recent EPE data (2013), but the EPE include expenditure only by the public sector and not by industry and specialised producers.

TABLE 17 PAST ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN SIX EAP COUNTRIES

EaP country EPE

(% of GDP) Year of

reference Comment Reference


Belarus 2.19 2002 Include domestic expenditures and expenditures from environmental protection funds

Pages 81 and 83, UNECE, 2005

Moldova 1.3 2013 Do not include expenditures by industry and specialised producers

Table 3.11, UNUCE, 2014

Ukraine 2.04 2004 Include expenditures by industry (1.7%) and public sector (0.34%)

Tables 6.1, 6.2, and 6.4, UNECE, 2007

Southern Caucasus

group

Armenia 0.19 1998 Include expenditures by enterprises (0.14%) and public sector (0.053%)

Tables 2.7 and 2.9, UNECE, 2000

Azerbaijan 1.61 2008

Include expenditures (0.44%), capital investments (0.35%), and state oil fund expenditures for water pipeline and irrigation (0.82%)

Tables 5.5, 5.6, and 5.9, UNECE, 2011

Georgia 0.5 2008 Include expenditures by public sector

Table 5.8, UNECE, 2010

Source: STELLA Consulting based on UNECE EPRs

Two of these UNECE EPR reports (Belarus and Ukraine) mention that the EPE are comparable to the EPE of OECD countries. Actually, the EPE of the EU-28 have been above 2% of GDP for 2003-2012 and have increased from 2.04% of GDP in 2003 to 2.20% in 2012 (see Table 18). According to Rademaekers et al., 2012, the EPE of the EU-27 were between 2.8 and 3.2% of the EU’s GDP (see Table 19), but they were slightly higher for those countries with a lower GDP such as Romania, Poland and Bulgaria. Four of the six EaP countries have a GDP per capita lower than Bulgaria’s (which is the lowest GDP per capita in the EU); the other two (Azerbaijan and Belarus) have a GDP per capita very similar to Bulgaria’s (see Annex VII).



TABLE 18 PAST ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN EU-28

Year EPE (% of GDP)

Industry Specialised producers Public sector Total

2003 0.42 1.01 0.61 2.04

2004 0.41 1.02 0.61 2.04

2005 0.4 1.02 0.65 2.07

2006 0.41 1.06 0.69 2.16

2007 0.42 1.04 0.67 2.13

2008 0.41 1.14 0.67 2.22

2009 0.4 1.14 0.75 2.29

2010 0.4 1.15 0.7 2.25

2011 0.4 1.16 0.68 2.24

2012 0.39 1.14 0.67 2.20

Source: Eurostat

TABLE 19

ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN EU-27

Country name EPE (% of GDP)

Old methodology New methodology10

Bulgaria 4.9 5.2

Poland 3.1 3.2

Romania 3.4 4.1

European Union* 2.8 3.2

*Data are for the EU-27; when the study was completed, there were only 27 Member States in the EU

Source: Rademaekers et al., 2012

Although there is no link between the GDP per capita of a country and the country’s EPE, the percentage of EPE seems to increase as the GDP per capita decreases. It may be possible to explain this relatively high percentage of EPE in poorer countries by the incompressibility of the EPE, i.e., the values of water or waste management expenses are similar in absolute terms; therefore, when presented as percentages, they appear to be higher in poorer countries. Another explanation could be that the newer Member States such as Romania and Bulgaria (and also Poland to a lesser extent) are

10

The different percentages depend on what the EU eco-industry market study (Rademaekers et al., 2012) refers to as the old and new methodologies. The new methodology has updated some of the indicators in the “old” studies and is based on updated data from Eurostat (see Annex VII).



under pressure to meet the targets in the environmental Directives; as a result, their EPE tend to be higher than the EPE of older MS. Eurostat does not have EPE data for the six EaP countries and the data from the UNECE reports are old and incomplete. Therefore, this study takes a conservative approach and assumes that the percentage of EPE in these six countries is the same and equal to 2.2% (average EPE of EU-28 in 2012 according to Eurostat, see Table 18). As a result, the EPE or eco-industry in the six EaP countries would have a total value of €6 billion in 2013 (see Table 20): this is about 0.5% of the €1.15 trillion estimated in 2010 for the global eco-industry and 1.5% of the €400 billion for the EU eco-industry (Rademaekers et al., 2012).

TABLE 20 ESTIMATED 2013 EPE IN SIX EAP COUNTRIES

EaP country Estimated EPE

(€ million) in 2013


Belarus € 1,213

Moldova € 134

Ukraine € 3,002

Southern Caucasus

group

Armenia € 177

Azerbaijan € 1,245

Georgia € 273

Total € 6,044

Source: STELLA Consulting’s estimates

There is a broad consensus that the global eco-industry could almost double by 2020, with an average estimate of about €2 trillion a year for 2020 (Rademaekers et al., 2012). Given that in 2010 the estimate was €1.15 trillion, this would represent an average annual growth rate of 5.7% over 2010-2020. It is hard to estimate the annual growth rate of EPE in the six EaP countries. The most conservative approach is to assume that EPE will grow at least at the same rate as the global market, i.e., an annual growth rate of 5.7%, which is still below the average growth rate recorded in the EU in 2000-2008 (see Table 21). In this case, the EPE in the six EaP countries would increase from €6 billion in 2013 to €8.9 billion in 2020, an increase of about €2.9 billion (see Table 22).



TABLE 21 EPE GROWTH IN THE EU (2000-2008)

Country name Annual growth rate of EPE (%)

Bulgaria 14.7

Poland 15.0

Romania 14.5

European Union* 6.1

*Data are for the EU-27; when the study was completed, there were only 27 Member States in the EU


TABLE 22

ESTIMATED 2020 ENVIRONMENTAL PROTECTION EXPENDITURES (EPE) IN SIX EAP COUNTRIES

EaP country Estimated EPE



Belarus €1,789

Moldova €198

Ukraine €4,426

Southern Caucasus

group

Armenia €260

Azerbaijan €1,835

Georgia €402

Total €8,910


The current EU eco-exports to each of the six EaP countries are rather limited. In 2013, the EU eco-exports amounted to about €1 million, which is only 0.0026% of total EU exports to the six EaP countries (see Annex VII). However, as the environmental situation improves in the EaP countries, eco-exports are likely to improve too. The potential benefits to the EU would come from the share of the EaP eco-industry market that the EU-28 could capture, as estimated in this study. As stated in Box 17, the EU is already well positioned in the global eco-market for some sectors.

In general, European companies perform well on the global market. The EU has a revealed comparative advantage in three sectors:

Air pollution control;

Monitoring equipment; and

Waste management.

BOX 17 COMPARATIVE ADVANTAGE OF EU

IN THE GLOBAL ECO-MARKET

Source: (Rademaekers et al., 2012)



The EaP countries have already made efforts to move towards green economies. Various international projects also support the EaP countries in this direction (see Box 18).

BOX 18 GREENING ECONOMIES IN THE EASTERN NEIGHBOURHOOD

Source: EU Neighbourhood Info Centre, 2014 (www.enpi-info.eu)

To quantify such benefits, this study has extrapolated global data to the EaP situation. The global external trade for environmental technologies and goods was €47.6 billion in 2010, which represented 4.1% of the global eco-industry of €1.15 trillion (Rademaekers et al., 2012). Applying the same 4.1 percentage to the €8.9 billion eco-industry estimated for the six EaP countries in 2020 (see Table 22) results in a potential external eco-trade of €365 million for the six EaP countries in 2020 (see Table 23). This is basically an estimate of the environmental technologies and goods that the EaP countries imported in 2013 from all countries in the world.

TABLE 23 SHARE OF EXTERNAL ECO-TRADE IN SIX EAP COUNTRIES CAPTURED BY EU-28

Indicator 2020

Size of eco-industry in six EaP countries €8.9 billion

External eco-industry (4.1% of eco-market) in six EaP countries €365 million

Share of external eco-trade in six EaP countries captured by EU-28 (14% of external eco-trade)

€51 million


Assuming that the EU-28 can capture 14% of that market (average EU share of the global eco-industry, see Annex VII), then the potential benefits to the EU-28 could reach €51 million per year starting in 2020 (see Table 23), which is significantly more than the €1 million of EU eco-exports to the six EaP countries in 2013. This sharp increase is reasonable because many EaP countries have signed or are negotiating trade agreements that will boost trade with the EU. In addition, they are progressively

Project: Greening Economies in the Eastern Neighbourhood Timeframe: 2013-2016 Location: Armenia, Azerbaijan, Belarus, Georgia, Moldova, Ukraine Budget: € 10 million Financial source: EC

This project supports EaP countries in their efforts to move towards a green economy by decoupling economic growth from environmental degradation and resource depletion and by promoting sustainable consumption and production strategies. The project aims to integrate a product life-cycle approach into decision-making, making it possible to tackle pollution at source rather than concentrating on remedial actions.



increasing environmental investments as they start approximating the EU environmental acquis, which should increase EU eco-exports. A number of studies have shown the positive link between environmental performance and job creation. The research shows how ‘greening the economy’ can boost job creation in areas directly connected to the environment such as conservation, waste, water and air quality. In 2010, about 3.4 million people worked in the EU-27 eco-industry (Rademaekers et al., 2012). Since the estimate of the EU eco-industry was about €400 billion in 2010, this implies that each job is worth about €117,647. With such an estimate, the potential benefits of €51 million for the EU-28 represent 434 jobs.

3.6.2 Level playing field

EU exports to EaP countries were €41.3 billion in 2013, which represented 2.4% of total exports of EU goods worldwide (see Table 24).

TABLE 24 EU EXPORTS TO THE SIX EAP COUNTRIES IN 2013

EaP countries EU exports



Belarus €8,619

Moldova €2,284

Ukraine €23,939

Southern Caucasus

group

Armenia €718

Azerbaijan €3,741

Georgia €2,034

Total €41,335

Source: DG Trade, 2014 (http://ec.europa.eu/trade/policy/countries-and-regions/index_en.htm)

The EU has been working on trade agreements with EaP countries for over 20 years, since it started developing Partnership and Cooperation Agreements (PCA). More recently, the EU has started to upgrade these agreements into Association Agreements (AA), which usually include a Deep and Comprehensive Free Trade Agreement (DCFTA). The DCFTA is expected to boost bilateral trade in goods and services and gradually bring the EaP country's trade-related rules and standards in line with the EU's. As part of the AA, it provides the basis for modernising and developing the EaP country’s economy. As shown in Table 25, the most advanced agreements are with Moldova, Ukraine and Georgia. It is difficult to forecast EU exports to 2020, but the current work on trade agreements should result in a substantial increase. In addition, as explained earlier,



production costs in EaP countries will increase and be comparable to production costs in the EU, which will increase the competitiveness of EU companies on the EaP market.

TABLE 25 CURRENT STATUS OF EU TRADE AGREEMENTS WITH EAP COUNTRIES

EaP country Status of EU trade agreement


Belarus PCA concluded in 1995 but not yet ratified

Moldova AA (including DCFTA) signed in June 2014 and provisionally

applied since September 2014

Ukraine AA (including DCFTA) signed in June 2014 and provisionally


Southern Caucasus

group

Armenia

PCA in force since 1999

Negotiations on AA and DCFTA started in September 2013 Further steps are not clear following Armenia’s decision to negotiate its membership with the Customs Union of Russia, Belarus and Kazakhstan

Azerbaijan PCA in force since 1999

Georgia AA (including DCFTA) signed in June 2014 and provisionally


PCA: Partnership and Cooperation Agreement; AA: Association Agreement; DCFTA: Deep and

Comprehensive Free Trade Area Source: DG Trade, 2014 (http://ec.europa.eu/trade/policy/countries-and-regions/index_en.htm)

There are two opposing views about the impacts of environmental regulations on production costs. The conventional perspective suggests that environmental regulations damage the economic performance of regulated (usually pollution intensive) industries because they increase production costs leading to lower productivity or profitability (Dechezleprêtre et al., 2014). For example, the decline in U.S. manufacturing employment from 18 million (25.3% of total US employment) in 1970 to 12 million (9% of total employment) in 2012 mirrors the introduction and expansion of U.S. environmental policy (Greenstone et al., 2012). Moreover, where there are differences in environmental regulations applied to firms competing for the same market; higher costs and lower productivity can affect market share. For example, polluting industries in open economies tend to gravitate towards regions with lenient environmental policy. In the short term, uneven environmental regulations could lead to reduced exports from regions with relatively ambitious policies. If businesses believe that some countries will always have more stringent environmental regulations, they may move manufacturing capacity to countries with relatively lax policies in the long run. However, most of the literature that has empirically examined this issue does not provide strong evidence to support the contention that environmental standards lead to



loss of international competitiveness (Babool et al., 2005), i.e., relatively high environmental standards have no significant impact on international competitiveness. In fact, an alternative view articulated by Michael Porter argues that environmental regulations might lead private firms and the economy as a whole to become more competitive internationally by providing incentives for environmentally-friendly innovation that would not have happened in the absence of policy (Porter, 1991). The Porter hypothesis originated primarily from analysing cross-border differences in the stringency of environmental regulation and economic performance. However, various studies looking at the whole causality chain implied by the Porter hypothesis, from regulation to competitiveness, through to innovation, and thus the impact on firms’ profitability do not support the Porter hypothesis. Although there are no studies assessing whether exports from developed countries increase because of a level playing field due to more stringent environmental regulations in developing countries, one could argue that the loss of total factor productivity (TFP) in EaP countries (once they implement more stringent environmental regulations) would be compensated by imports from the EaP trading partners, including the EU. Given the lack of studies on this topic, it is not possible to quantify these potential exports from the EU to EaP countries. However, as shown in Annex VII, EU exports to EaP countries were €41.3 billion in 2013; a relatively small increase of 5% would amount to €2 billion, which is comparable to the economic benefits estimated for air (€2.6 billion) and water (€5.4 billion).



4 CONCLUSIONS

The goal of this study was to assess the potential environmental and economic benefits for the EU that would result from the increased convergence of the EaP countries to the EU environmental acquis. The study shows that this increased convergence can indeed yield benefits, but the quantification of these benefits is subject to various limitations that decision-makers must understand before prioritising their actions. The results presented in the study lead to three main conclusions:

1. EaP countries and EU to benefit significantly from environmental improvements in EaP countries: The EaP countries and the EU will both benefit from environmental improvements in EaP countries and these benefits will be significant, even if some of them are difficult to quantify due to a lack of valuation studies on the impact of environmental degradation in the literature (e.g., benefits from improved marine areas or biodiversity). The EU can expect to gain benefits amounting to at least €8 billion per year as of 2020: €2.6 billion from air improvements due to reduced mortality and morbidity, and €5.4 billion from water improvements, estimated based on willingness to pay. The EU should also benefit from increased revenue from eco-trade of €51 million/year equivalent to 434 jobs. Other benefits will certainly accrue from an enhanced marine environment, increased biodiversity and improved waste management. The six EU countries bordering the EaP countries (Romania, Hungary, Slovakia, Poland, Lithuania and Latvia) stand to gain the most.

2. Preliminary indications for identifying priority areas for action:

This study is a first illustrative estimate of the benefits expected to accrue from environmental improvements in EaP countries. For example, the study shows that the highest expected benefits would be from improvements in the water and air sectors. However, this is likely to be because these two sectors are the ones for which the most valuation studies are available in the literature. Similarly, the study suggests that improvements in Ukraine would yield the highest benefits; however, this is primarily because Ukraine is the largest and most populated EaP country. The study also shows that the EaP countries and the EU would benefit from the remediation of ‘hot spots’, such as obsolete pesticides in various locations in Moldova, or hazardous waste tanks in Belarus, along the Bug River, at the Belarusian-Polish border. However, it was beyond the scope of the study to quantify the risk from these hot spots or the benefits that would result from their remediation.



3. Expected benefits to materialise only if the EaP countries improve their environmental situation:

Unsurprisingly, the first countries to benefit from environmental improvements in the EaP countries are the EaP countries themselves. Overall, citizens from EaP countries would benefit in terms of cost savings and improved quality of life. These benefits could be substantial, e.g., €9 billion/year due to improved air quality alone. To improve their environmental situation, the EaP countries have to increase their investments in more effective environmental policy-making, implementation, financing and enforcement. The EaP countries should strengthen their national environmental policies/targets and support their implementation in order to perceive trans-boundary benefits.



5 RECOMMENDATIONS FOR ACTION BY THE EU

As explained in the previous section, this study shows that the convergence of the EaP countries to the EU environmental acquis will benefit both EaP countries and the EU. This study also seems to indicate that the highest benefits would come from improvements in the water and air sectors and also from Ukraine, which is the largest and most populated EaP country. However, the expected benefits resulting from the convergence to the EU environmental acquis will materialise only if the EaP countries take the appropriate measures to promote this convergence. How can the EU support the EaP countries with this process? The EU is already supporting the EaP countries in many ways (e.g., cross-border cooperation, regional programmes on environment, financial support through the EIB investments, technical assistance and negotiation of trade agreements). Therefore, the primary requirement is to strengthen and speed up the EU support to EaP countries. This study has identified the following three recommendations:

1. Assist EaP countries in identifying priority areas for progress; 2. Support EaP countries in improving their environment situation; and 3. Continue to ensure that future trade agreements mitigate any adverse

environmental impacts. These recommendations are described in more detail below; they complement the recommendations of other studies promoting environmental improvements in the EaP countries (see Box 19 and Box 20).

Source: ten Brink et al, 2011 Source: Safege, 2011

BOX 19

KEY RECOMMENDATIONS OF ENPI STUDY

Increase importance of green economy issues in ongoing projects

Prepare a new “umbrella” project on Green Economy Governance

Increase importance of green economy/green growth relevant issues in existing financing mechanisms and in "soft“ cooperation activities

Increase coordination of activities with international organisations active in the region in the field of green economy

Initiate regular meetings of international donors active in the region

Give greater attention in policy making, implementation, financing and enforcement

Strengthen national environmental policies/targets and obtain due support for their implementation

Encourage EaP countries to conduct their own national benefit assessment studies, in order to support good governance and facilitate identification of priority areas for progress

Invest in measurement and data

Act quickly to avoid the costs of inaction

BOX 20 KEY RECOMMENDATIONS OF EAP

GREEN ECONOMY STUDY



5.1 Assist EaP countries in identifying priority areas for progress

To identify priority areas for progress, the EaP countries and the EU need to improve the quality of the available environmental data and indicators; this improved data would in turn allow detailed cost-benefit analyses. The improvement of data quality should be ensured through the following measures:

Improve the EU Shared Environmental Information System (SEIS) for better environmental data and indicators

The implementation outlook of the EU Shared Environmental Information System (SEIS) explains that it is vital to have the right information and data at the right time (EC, 2013). Information needs may differ; yet for everyone, information needs to be fit-for-purpose. For that reason, common criteria such as accuracy, validity, reliability, timeliness, relevance, completeness, comparability and coherence over time are relevant to all kinds of environmental information. One indicator that would be very useful is the amount of a given pollutant emitted or discharged by region or country in order to determine the contribution of any region or country to the total amount of pollutant released to the environment.

Conduct a detailed cost-benefit analysis to identify the cost-effectiveness of improvements in various environmental sectors A detailed cost-benefit analysis could provide decision-makers with enough information to prioritise one environmental sector (e.g., air or water) over another (e.g., biodiversity or marine environment) depending on the estimated benefits and therefore the cost-effectiveness of the improvements in various environmental sectors. The analysis in this current study is not refined enough for such prioritisation. It would be necessary to develop a core set of country specific assumptions with a range of scenarios and sensitivities to provide additional nuance and robustness.

5.2 Support EaP countries in improving their environment situation

As explained above, there are many hot spots in the EaP countries that would benefit from an immediate remediation, particularly those on the border between one of the EaP countries and an EU Member State. More generally, any improvements in the environmental situation of the EaP countries will benefit the EaP countries and the EU. Therefore, the EU should strengthen its support and increase its financial support to cross-border cooperation:



Pursue cross-border cooperation The EU has already indicated that cross-border cooperation (CBC) on its external borders is a key priority in the European Neighbourhood Policy11. As explained in its strategic framework, CBC under the European Neighbourhood Instrument (ENI) builds on the CBC carried out under its predecessor, the ENPI. The indicative total CBC funding for 2014-2020 is €489-598 million. CBC contributes to the overall ENI objective of progress towards 'an area of shared prosperity and good neighbourliness' between EU Member States and their neighbours. One of the three overarching strategic objectives of CBC is to address common challenges in environment, public health, safety and security. CBC also has a list of 11 thematic objectives. The priorities under Objective 6 (Environmental protection, climate change mitigation and adaptation) are as follows:

Joint actions for environmental protection and efficient management of maritime space and resources;

Preservation and sustainable use of natural resources including biodiversity;

Support to sustainable waste and waste water management;

Joint action and cooperation in addressing climate change challenges, including modelling of impacts of the changing climate and development of the corresponding (joint) measures;

Promotion of a low carbon and climate resilient development; and

Support to energy and resource efficiency (including use of renewable energy), complementing Objective 9 (Promotion of and cooperation on sustainable energy and energy security).

Such priorities are of crucial importance for improving the environment in the EaP countries, and for providing benefits to the EU. Therefore, the Commission should ensure that there are adequate CBC programmes addressing these priorities.

11

Programming of the European Neighbourhood Instrument (ENI) – 2014-2020, Programming Document for EU support to ENI Cross-border Cooperation (2014-2020), European Commission –DG for Development and Cooperation – EUROPEAID.



Increase financial support through EIB

The EU has already provided the EaP countries with substantial financial support through the EU bank, i.e., the European Investment Bank (EIB). The mandate governing EIB activity in the Russian & Eastern neighbourhood has broadened in size and scope since 2001. In 2007-2013, the mandate amounted to €3.7 billion and covered Russia, the EaP Eastern Europe countries (Ukraine, Moldova and --subject to future European agreement-- Belarus) as well as the EaP Southern Caucasus countries (Armenia, Azerbaijan and Georgia). For 2014-2020, the EIB mandate has increased to €4.8 billion and its objectives include:

Local private sector development, including support for small and medium-sized enterprises (SMEs);

Development of social and economic infrastructure; and

Climate change mitigation and adaptation, with an expectation that climate change mitigation and adaptation account for at least 25% of total EIB financing operations.

In December 2010, the Eastern Partnership Technical Assistance Trust Fund (EPTATF) was established as a multi-donor, multi-sector Trust Fund delivering appropriately-scaled advisory services and capacity building support to enhance the quality and development impact of EIB's operations in the EaP countries12. Due to their legacy of energy-intensive industries from the Soviet era, the EaP countries have a substantial potential for mitigation measures. However, the national authorities have not gone as far as the EU in adopting targets and providing feed-in tariffs or other financial support and therefore the project pipeline is constrained. Nevertheless, energy efficiency, renewable energy, sustainable transport, urban infrastructure and water have all been identified as areas with substantial investment needs in the region and are viewed as high priorities by the national authorities. EIB could also develop a programme similar to JASPERS that has proved extremely successful in supporting the development of projects in the new EU Member States. JASPERS is a good example of a well-designed Technical Assistance Facility with a proven track record of improving project

12

EIB, Eastern Partnership TA Trust Fund (EPTATF), Strategic Orientations & Operational Plan 2014 – 2016, July 2014.



quality13. Targeted assistance for project preparation (e.g. JASPERS) can help to provide a pipeline of well-prepared projects.

5.3 Continue to ensure that future trade agreements mitigate any adverse environmental impacts

As explained in this study, the EU and EaP countries are currently negotiating upgrades of trade agreements incorporating environmental dimensions. The EaP countries have already taken on, or will soon take on, significant obligations to promote high standards of environmental protection, to enforce environmental laws effectively and to not derogate such laws to attract investment. They will also promote corporate social responsibility, with particular attention to environmental management in key export sectors. The EaP countries’ trade and environment agenda is influenced by market access concerns and treaty negotiating dynamics. EaP exporters have made progress in environmental management, improving EaP countries’ reputation as reliable suppliers and securing access to foreign markets. The Commission should continue to ensure that all ongoing and future trade agreements fully take into account the need to mitigate any adverse environmental impacts.

13

Special Task Force (Member States, Commission, EIB) on Investment in the EU, Final Task Force Report



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STELLA Consulting – Final study 22.04.2015 – Annexes Page i

Annex I – Environmental priority areas in EaP countries

The hot spot maps on the following pages (see Figure 11 and Figure 12) identify a number of key environmental priority areas in both the EaP Eastern Europe group and the EaP Southern Caucasus group. There are seven environmental priority areas for the EaP Eastern Europe Group:

1. North-western Belarus; 2. Polesie; 3. West Ukrainian industrial areas and Carpathian mountains; 4. Lower Dniester and Transnitria area; 5. Lower Danube; 6. Donbas and adjacent areas; and 7. Crimea.

The last two (Donbas and Crimea) are a bit farther away from the EU-28; the following paragraphs summarise the environmental challenges in Belarus, Ukraine and Moldova, based on the information contained in Cherp et al, 2007. Belarus All major rivers of Belarus receive wastewater from industries and municipal sewage systems, with the biggest impact downstream from Minsk on the Svisloch river, a tributary of Berezina and ultimately the Dnieper. The Dnieper itself receives wastewater downstream from Mogilev, but there are significant threats to the water quality of other rivers too. For example, the Z. Dvina / Daugava supplies most of the drinking water for Riga, the capital of Latvia, yet at the same time it is saddled with some of the most dangerous facilities in Belarus industry: Novopolotsk refineries and chemical plants. The Pripyat watershed encompasses most of Polesie, a unique geographic region and an ecosystem of European importance straddling the border between Ukraine and Belarus, reaching as far as eastern Poland and the west of the Bryansk region of Russia. Polesie (forest land), which covers approximately 30% of Belarus, is the largest expanse of marshland in Europe, a habitat for many endangered bird species, and the site of several inter nationally important wetlands protected under the Ramsar convention. In Belarus, large parts of Polesie – and other wetlands – were “meliorated” especially in the 1960s-1980s to enable farming. This process included draining marshlands, “straightening” rivers, building embankments to halt flooding and other similar measures. The area of meliorated land covered 16% of the whole country, and up to 20% or 30% of some river basins. The melioration often disregarded environmental factors, affecting negatively ecosystems and natural resources. In particular, it affected the local climate leading to higher frequency of drought and frost and eroded light and peat soils, ultimately leading to desertification.


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Ukraine Water management issues have caused international disputes. For example, Romania has expressed concern in a number of international forums regarding Ukraine’s plans to develop the Bystre canal. There have been disagreements between Moldova and Ukraine over the construction of an oil terminal and refinery at Giurgiulesti and a railway linking Izmail and Reni, despite positive signs that such concerns may be smoothed out to facilitate tri-partite cooperation on sustainable development of the Danube delta. Ukraine has registered six protected areas with UNESCO. Two of these are trans-boundary biosphere reserves: the East Carpathians reserve covering parts of Poland, Slovakia and Ukraine, and the Danube reserve in the Danube delta jointly administered by Ukraine and Romania. Both reserves were set up in 1998 and aim to support sustainable development in their respective cross-border regions through integrated research and monitoring, public education, and land-use planning and management activities. In addition, reserves (including biosphere reserves) and national parks are located on the Ukrainian borders with Romania (in the Carpathians), Poland, Moldova, Belarus Polesie, Russia, and on the Black Sea coast, including Crimea. Furthermore, several smaller protected areas are located in border areas. Ukraine is a party to the Convention on the Protection and Sustainable Development of the Carpathians, which, among others, seeks to preserve Carpathian biodiversity. Ukraine harbours a considerable amount of hazardous waste, including more than 100 large and 5,000 small stockpiles of obsolete pesticides, amounting to nearly 20,000 tonnes. Although there are pesticide stockpiles all over Ukraine, most are concentrated in the Sumy, Kyiv, Kirovohrad, Zaporizhzhia, Dnipropitrovsk, Odesa, Vinnitsya, Kharkiv oblasts, and in Crimea. Considerable amounts are located in the basins of trans-boundary rivers or in areas close to borders (e.g. in the Carpathian region). More than 11,000 tonnes of hexachlorobenzene, another persistent organic pollutant, are stored in the Ivano-Frankivsk oblast, in the upper reaches of the Prut and Dniester rivers. Paradoxically, the application of stricter EU environmental standards on Ukraine’s neighbours, Slovakia and Hungary, has resulted in numerous attempts to “export environmental problems” across eastern border. This reports were particularly common in the early 2000s, when allegedly toxic substances from Hungary were misleadingly labelled, exported to Ukraine and disposed of illegally (it has also been claimed that some of this waste was originally exported to Hungary from Western Europe). Moldova Moldova’s second largest river, the Prut, also rises in the Ukrainian Carpathians, flowing along the Moldova-Romania border to reach the Danube at Galati, Romania. Much as the Dniester, the Prut suffers from upstream water pollution (including from the severely polluted Jijia river, which enters from Romania). Irreversible transformation of natural systems has been observed downstream from the trans-boundary Stinca-Costesti reservoir.


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FIGURE 11 ENVIRONMENTAL PRIORITY AREAS IN EAP EASTERN EUROPE

Source: Cherp et al., 2007


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There are eleven environmental priority areas for the EaP Southern Caucasus Group:

1. Black Sea coastal zone; 2. South Ossetia; 3. Central Caucasus trans-boundary area; 4. Sevan Lake; 5. Yerevan; 6. Tbilisi; 7. Ararat and Vaik valleys; 8. Nagorno-Karabakh territory and adjacent regions of Azerbaijan; 9. Sunik region; 10. Greater Baku; and 11. Kura river estuary and southern coast of the Caspian Sea.

The following paragraphs summarise the environmental challenges in Armenia, Azerbaijan and Georgia, based on the information contained in Cheterian et al, 2004. Armenia Sevan Lake: a history of public activism linked to national emotion, competing demands for this lake’s water, and rising pressures from tourism, make the ecological integrity of Sevan Lake an important concern. The stabilisation of the lake level, strengthened management of the shore zone, and the implementation of sewage treatment and solid waste management in the area, can contribute to reinforcing the political legitimacy of the state. Lori-Tavush Region: the Soviet legacy of polluting industrial complexes has made this region another hot spot. Though limited in scale, mining and metallurgical activities, such as in Alaverdi, pollute the Debed River. Water pipes are obsolete and leaking. In the wake of torrential rains, there are instances of contamination of drinking water by sewage water, undermining public health in Alaverdi City. Maintenance of joint irrigation systems in the region has been neglected, threatening nearby settlements downstream. Yerevan, and the Ararat and Vaik Valleys: the capital city of Yerevan is developing in rapid strides, which could affect the environment and create social tensions. The city’s population is increasing as a result of the influx of migrants and rural workers seeking economic opportunities. The shift of public transportation from mass transit to microbuses, the resulting increase in car traffic and the increase in unregulated construction projects are sources of concern. Similarly, the rise in construction has led to the destruction of old, private houses, as well as parks and green areas. The growth of the greater city area is having direct impacts on the environment of the whole of the Ararat Valley, where half the country’s population lives. The land and water quality in the valley is a major concern. Mass usage of pesticides in the Soviet era continues to pollute land and water, while lack of maintenance of the irrigation drainage system is intensifying salinization of the soils. The overuse of groundwater resources, and lack of information about it, is yet another source of concern.


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Sunik Region: near Agarak, mining activities in Kajaran, Megri and Kapan provide an important source of income, despite their reduced productivity when compared to Soviet levels. At the same time, they have contaminated the Araks/Araz River. The population is extremely poor and usually cannot afford health care. In the past, Iran has complained about trans-boundary pollution from extensive opencast mining in this area. Deforestation is also important because these dry forests have limited capacity for regeneration. Azerbaijan Nagorno-Karabakh and adjacent regions: apart from the demarcation zone, which remains particularly sensitive, several major problems affect the area: water management, use of surface and underground water reserves, management of forest resources and protected areas, and population movements. Central Kazakh and Tavuz districts: at the point where the Kura enters Azerbaijan, the problems of water quality and management are particularly acute. Several large industrial centres, throwbacks to the Soviet period, are located there (Ganja, Mingachevir, Dashkesan) and require specific environmental measures. Improved land use and the availability of summer and winter pasture, are vital to the livelihoods of local communities and to the ecological balance of this fragile, dry habitat. Greater Baku: the capital city and surrounding communities, including part of the Apsheron peninsula, is home to more than a third of the country’s population and two-thirds of its industrial production, including almost the entire petroleum extraction sector. It hosts nearly all of the country’s environmental ills: rapid and unregulated urban growth; industrial pollution, due to present activity or inherited from the Soviet era; poor water and air quality, taking into account the spread of automotive traffic with obsolete motors; and management of the Caspian coastline in line with variations in sea level. Kura Estuary and Caspian coastline: the main ecological problems include poorly maintained or abandoned irrigation and drainage networks; rising groundwater levels causing salinisation of arable land; and overgrazing of winter pastures. Mud banks have recently formed, blocking the Kura estuary, while the Caspian Sea level rise has threatened coastal infrastructure and forced many communities to relocate. Georgia Black Sea coastal zone, from the Turkish border to the Russian border: in addition to its fragile indigenous ecosystems (dense forests and wetlands), this coastal region also includes some of the country’s major industrial sites (ports and oil terminals). It is also a main area for coastal tourism, currently under rapid development. In Abkhazia, there is little or no information on whether and where radioactive materials have been disposed, and on the levels of radiation they generate. Local authorities, the Georgian central government, the local population and the international community, would all


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benefit from new information on the development and effects of radioactive military waste left behind by the Soviet and Russian forces, and on the state of forest and fisheries, mining and hazardous chemicals in the region. South Ossetia: due to the lack of information on the environmental situation in South Ossetia, it would be useful to initiate a field assessment of land use and deforestation in this region. Marneuli-Gardabani: this region is affected by water scarcity and environmental degradation from agricultural and industrial activities; it could be part of a trans-boundary project with the Lori-Tavush region in Armenia and Kazakh-Tavuz in Azerbaijan. Urban area of Tbilisi: with more than a quarter of the country’s population, the capital region is affected by all the country’s current major environmental issues: high con-centration of migrants and refugees, growing water and air pollution, and uncontrolled urbanisation.


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FIGURE 12

ENVIRONMENTAL PRIORITY AREAS IN EAP SOUTHERN CAUCASUS

Source: Cheterian et al., 2004


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Annex II – Water quality: current perspective for the EU

This section summarises the current commitment of the EaP countries to the most relevant EU directives and conventions, namely:

The UNECE Convention on the Protection and Use of Trans-boundary Watercourses and International Lakes (UNECE Water Convention);

The Convention on Co-operation for the Protection and Sustainable Use of the River Danube (Danube River Protection Convention - DRPC); and

The Directive 2000/60/EC of the European Parliament and of the Council establishing a framework for the Community action in the field of water policy (Water Framework Directive - WFD).

The UNECE Water Convention aims to strengthen national measures for the protection and ecologically sound management of trans-boundary surface water (rivers and lakes) and groundwater. The Convention provides a legal framework for regional cooperation on shared water resources and it obliges parties to prevent, control and reduce the trans-boundary impact and to ensure sustainable management of the trans-boundary waters. Many international agreements as well as bilateral or multilateral agreements on trans-boundary water resources management between European countries and third countries are based on the principles and provisions of the Convention (e.g., Dniester Rivet Basin Treaty, Danube River Protection Convention, Rhine Convention, Meuse, Scheldt, etc.). There are also two protocols to this Convention: Protocol on Water and Health (addressing the problems of water related diseases) and Protocol on Civil Liability (addressing compensation for damage resulting from trans-boundary impact of industrial accidents). Azerbaijan, Belarus, Moldova and Ukraine have ratified the UNECE Water Convention and must implement its provisions. Although Armenia and Georgia are not parties to the Convention, they participate in several activities and might consider ratification in the future. Table 26 summarises the contracting status of the EaP countries to the Convention and its Protocols.


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TABLE 26 UNECE WATER CONVENTION AND EAP COUNTRIES

EaP countries

UNECE Water Convention

Protocol on Water and Health

Protocol on Civil Liability

Signatory Non signatory

Signatory Non

signatory Signatory

Non signatory


Belarus X

Moldova

Ukraine

Southern Caucasus

group

Armenia X X

Azerbaijan X

Georgia X X

Source: UNECE, 2014 (www.unece.org/env/water)

The Danube River Protection Convention builds upon the principles of the UNECE Water Convention and is a good example of its implementation in one of the most international river basins in the world. The DRPC forms the overall legal instrument for cooperation and trans-boundary water management in the Danube River Basin. The implementation of the WFD as a priority in the Danube River Basin was confirmed in the Resolution of the International Commission for the Protection of the Danube River Ordinary Meeting, in 2000. The contracting parties of the DRPC agree to cooperate on fundamental water management issues by taking "all appropriate legal, administrative and technical measures to at least maintain and where possible improve the current water quality and environmental conditions of the Danube river and of the waters in its catchment area, and to prevent and reduce as far as possible adverse impacts and changes occurring or likely to be caused." All Danube countries holding a territorial Danube catchment area are contracting parties to the DRPC, including Moldova and Ukraine, the only EaP countries located in the Danube basin (see Figure 13). Moldova and Ukraine have actively participated in the activities under the DRPC including the development of a basin-wide Danube River Basin District Management Plan adopted in February 2010 by all contracting parties in the frame of a Ministerial Meeting. Ukraine has also participated in the development of the Tisza River Basin District Management Plan, adopted in 2011 (Vogel, 2013).


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FIGURE 13 EAP AREAS OF THE DANUBE RIVER BASIN

Source: International Commission for the Protection of the Danube River, 2009 (www.icpdr.org)


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The Water Framework Directive establishes the principles to protect and enhance the status of all waters and protected areas including water depending ecosystems, prevent their deterioration and ensure long-term, sustainable use of water resources. The implementation of the EU WFD is legally binding for the EU Member States, but is also important beyond the EU territory via agreements under the European Neighbourhood Policy. All EaP countries have committed in some form, although at different paces, to harmonising their national legislation with the WFD and other EU directives, and the Integrated Water Resources Management (IWRM) principles, in the framework of their cooperation with the EU, EU Water Partnership, Eastern Partnership, or in national strategies/policies. Some of the countries have already harmonised and aligned their national legislation with the EU WFD requirements and other EU directives, such as (Koszta et al., 2014):

Armenia: the Armenia Water Code is harmonised with the WFD requirements and steps are being taken for establishing six national Water Basin Management Authorities;

Moldova: the new Water Law No. 272, entered into force in October 2013, is partly aligned with the EU WFD and other EU Directives; and

Ukraine: the Law on Environmental Protection and the Water Code as well as the State Programme on Water Management development by 2020 reflect the principles and provisions of the EU WFD and the IWRM.

In the other EaP countries, the amendment and harmonisation of the relevant legislations are planned and/or are already under development, such as:

Georgia: the new Water Act is currently under development, and aims to include IWRM approach and to reflect also the WFD requirements;

Azerbaijan: the harmonisation of the national legislation with EU Directives is an important component of Azerbaijan’s cooperation with the EU including the approximation of national legislation with the EU WFD. The National Indicative Programmes for 2007–2010 and 2011–2014 have identified respective priority areas for cooperation and related objectives; and

Belarus: the national legislation is not yet aligned with the IWRM and WFD principles but the amendment of the Water Code is planned according to the Water Strategy developed until 2020 and adopted in 2011.

In all countries efforts are also made for implementing the legal requirements of the WFD. However, only few have made progress in this regard (Koszta et al., 2014).


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Annex III – Calculations of benefits from improved water quality

To quantify the potential benefits for the EU of improved water quality in the EaP countries, this study assumes that all EaP countries would aim to match the targets of the EU Water Framework Directive and the objective of no deterioration in quality and achievement of Good Ecological Status in 2020. Due to data limitation, this analysis does not include lake water quality. The domestic monetary benefits (see Table 27) equal the estimated amount of money that households (HH) in each country would be Willing To Pay (WTP) for improved surface water quality by 2020 (ten Brink et al., 2011). The approach to valuing improvements in surface water follows that of a UK study which determined the willingness to pay of households for cleaner water; ten Brink et al., 2011 adapted the original benefit functions from the UK and transferred to each EaP country by including specific contextual water quality and socio-economic information in the benefits transfer exercise.

TABLE 27 DOMESTIC BENEFITS OF MEETING WATER QUALITY IMPROVEMENT TARGETS IN 2020

EaP countries

WTP results in 2020 €PPP

14 per HH year

Aggregated benefits WTP in 2020 €PPP

million

Benefits relative to GDP in 2020 %

Lower estimate

Upper estimate

Lower estimate

Upper estimate

Lower estimate

Upper estimate


Belarus 58.8 207.1 204.0 718.0 0.18% 0.62%

Moldova 37.8 147.1 45.4 177.1 0.44% 1.73%

Ukraine 50.5 184.6 870.1 3,180.5 0.27% 1.00%

Southern Caucasus

group

Armenia 45.9 180.4 38.1 149.7 0.20% 0.79%

Azerbaijan 30.7 143.3 92.1 430.0 0.11% 0.49%

Georgia 44.5 174.6 48.5 190.3 0.25% 0.97%


All countries in the region share trans-boundary waters with neighbouring countries, both upstream and downstream. Measures to improve the quality of water bodies and water use efficiency will, in many cases, also benefit neighbouring countries. Only countries in the EaP Eastern Europe group share rivers with the EU-28; the EaP Southern Caucasus group of countries is too far away from the EU-28 to benefit from any measurable impact (the impact on the Black Sea is analysed under the marine areas section).

14

Purchasing Power Parity (PPP equates the purchasing power of different currencies).


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This study has estimated trans-boundary monetary benefits with a Geographic Information System (GIS), which quantified the main EaP rivers that have an impact on the EU-28 territory. The GIS has identified the rivers flowing downstream, according to the relevant watersheds (see Table 28, Figure 14, Figure 15, and Figure 16).

TABLE 28 EU RIVERS BENEFITTING FROM IMPROVED RIVER QUALITY IN EAP EASTERN EUROPE GROUP


EU river benefitting

from improved river quality

Belarus Neman, Neris and Merkys (in Lithuania)

Vistula, Bug and Narew (in Poland)

Daugava (in Latvia)

Moldova Prut, Danube and Chilia (in Romania)

Ukraine Vistula and Bug (in Poland)

Danube, Siret, Chilia and Borcea (in Romania)

Latorica (in Slovakia)

Tisza and Bodrog (in Hungary)


FIGURE 14

RIVERS OF BELARUS AND EU-28 IMPACT



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FIGURE 15 RIVERS OF MOLDOVA AND EU-28 IMPACT

FIGURE 16 RIVERS OF UKRAINE AND EU-28 IMPACT



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To estimate the benefits for the EU in particular, this study has assumed that the impact would be proportional to the length of the river. This study has calculated the benefit per kilometre of river using the average WTP estimate and calculated the length of the rivers shared with an EU Member State to estimate the trans-boundary benefit according to the length of river within the EU-28 territory (see Table 29). This study has adjusted the WTP in ten Brink et al., 2011 (based on the ratio of the EU GDP to the GDP in each EaP country) and considered that the EaP countries’ Willingness To Pay (WTP) was the same as in the neighbouring EU Member States (Latvia, Lithuania, Poland, Slovakia, Hungary and Romania).

TABLE 29 WATER QUALITY TRANS-BOUNDARY BENEFITS FOR THE EU IN 2020


Domestic aggregated benefits WTP in 2020 (€ million)

Rivers' length (km)

Trans-boundary benefits WTP for the EU in 2020 (€

million)

Lower estimate

Upper estimate

Average estimate

GDP adjustment

In the country

In the EU-28 (down-stream)

Benefits per km of river

Benefits for the EU

rivers

Belarus 204.00 718.00 461.00 2,083.95 13,317.06 6,100.14 0.16 954.60

Moldova 45.40 177.10 111.25 1,708.71 2,722.69 901.85 0.63 565.98

Ukraine 870.10 3,180.50 2,025.30 17,782.81 26,252.99 5,702.82 0.68 3,862.88

Total 5,383.46


In conclusion, in 2020, the monetary benefits for the EU of improved water quality in the EaP countries could reach €5.4 billion per year starting in 2020, provided the water quality levels achieve the Good Ecological Status for all river surfaces. Most of the benefits (€3.9 billion) come from improvements in Ukraine.


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Annex IV – Air quality: current perspective for the EU

Currently, the general air quality management systems in EaP countries are rather limited compared to systems developed and implemented in the EU. The major system gaps in air quality management concern all EaP countries with the partial exception of Belarus, and relate to (Markevych et al., 2014):

Underdeveloped systems of air quality monitoring;

Insufficient air quality data gathering, processing and interpretation;

Limited access to information on air quality;

Incomplete emission inventories;

Missing automatic emission control measurements by plant operators;

Missing air quality projections;

Lack of strategic documents;

Insufficient administrative capacities;

Lack of air quality standards for PM10 and PM2.5;

Lack of national emission ceilings; and

Lack of technology-based emission limit values in all EaP countries except Belarus.

There is also a general lack of binding documents for the operation of installations and integrated permitting in all EaP countries, with the partial exception of Belarus and Ukraine. When compared with the EU system, the major differences are the air quality standards, fuel quality and emission standards for vehicles, format for collecting data and environmental permitting. Limited air quality management systems in EaP countries have an impact on the EU-28. Air pollutants can travel hundreds of kilometres and have an impact over long distances, e.g., acid rain leads to acidification and eutrophication of ecosystems or affects economically important resources such as fisheries. To address this issue, the six EaP countries have already signed the Convention on Long-Range Trans-boundary Air Pollution (CLRTAP), directed by the United Nations Economic Commission for Europe (UNECE). Today, the priority is to implement the Convention protocols and meet the corresponding commitments (see Figure 17). As shown in Figure 7, there is room for improvement in all EaP countries as well as the rest of Eastern Europe.


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FIGURE 17 CURRENT STATUS OF IMPLEMENTATION OF CLRTAP AND ITS PROTOCOLS BY EAP COUNTRY

Note: P – participation, S – signature, R – accession, acceptance, approval or ratification. Source: UNECE, 2014 (www.unece.org/env/lrtap/lrtap_h1)

Regarding the policy situation, the six EaP countries are parties to many international environmental agreements on air quality and submit reports to international organisations, such as:

Convention on Long-Range Trans-boundary Air Pollution (CLRTAP);

United Nations Framework Convention on Climate Change (UNFCCC);

Vienna Convention for the Protection of the Ozone Layer;

United Nations Convention to Combat Desertification (UNCCD); and

Basel Convention on the Control of Trans-boundary Movements of Hazardous Wastes and their Disposal.

However, the air quality legislation differs in each country (Markevych et al., 2014). Belarus has a well-developed legal system with a large number of environmental legislation and normative documents, including: the 1992 framework law on the protection of the environment as amended in 2002; the 1997 law on the protection of atmospheric air as amended in 2009; and the 2001 law on ozone layer protection. Belarus has also taken the lead on IPPC implementation in the former USSR, having developed both first and secondary level legislation.

Belarus - Country priorities (Markevych et al., 2014)

Convergence of the national air pollution legislation to the EU standards;

Ratification of the CLRTAP protocols;

Implementation of passive sampling methodologies;

Training of specialists in monitoring;

Identifying priority industries for IPPC implementation;

Development of technological standards for emissions;

Emission measurements of waste gases in a large industry; and

Environmental impact assessment of the transport in Minsk.


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In 1991, Ukraine adopted the framework law on environmental protection, followed by several new pieces of legislation such as: the 1992 law on air protection, amended in 2001; the 2001 cabinet decree on the procedure for developing and approving emission limit values for stationary sources; the 2010 strategy for the national

environmental policy till 2020; and the 2011 national environmental action plan till 2015. Following its independence in 1991, Moldova has gradually developed its environmental legislation and aims at convergence with the European acquis. The 1993 law on environmental protection, as amended in 2011, is the central piece of environmental legislation and contains specific measures and main directions in air protection, air pollution prevention and improvement of air quality. Moldova has also passed the 1997 law on atmospheric air protection, last amended in 2008.

Armenia adopted the 1994 law on atmospheric air protection, amended in 2010. Armenia has adopted new air quality standards for pollutants that coexist with other air quality standards previously inherited from the Soviet era. The National Assembly has also discussed new laws on emission measurements by industrial installations and preparatory work is underway to align the legislation with the IPPC Directive

Moldova - Country priorities (Markevych et al., 2014)


Drafting the national air quality assessment and management strategy;

Development of national GIS datasets;

Awareness raising campaigns;

Strengthening the capacities on air quality monitoring;

Training of staff in EU legislation, emission inventories and modeling;

Development of an action plan for the city of Chisinau; and

Evaluation of costs for emission reduction.

Ukraine - Country priorities (Markevych et al., 2014)


Compliance with international commitments under CLRTAP and its protocols;

Establishment of maximum permissible concentration of emissions of VOCs from stationary sources;

Control ammonia emissions from agricultural sources;

Development of a database of best available technology;

Analysis of the persistent organic pollutants (POPs) sources in accordance with the European legislation; and

Implementation of dispersion model of vehicles emissions in one town in Ukraine.

Armenia - Country priorities (Markevych et al., 2014)


Assessment of the national capacity to ratify the CLRTAP protocols and to meet their commitments;

Emission reduction in the transportation sector;

Improving the air quality monitoring network;

Development of technology-based emission limit values; and

Development of mechanisms to promote the use of public transport and best available technologies.


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2010/75/EU, by including a chapter on the use of technology-based approaches to regulate industrial activities, probably the mining and cement sectors. The major initiatives in Azerbaijan include: a comprehensive action plan to improve the environmental situation in 2006-2010; the action plan on legal approximation with the EU acquis 2010-2012; the 2010 decree on measures for complying with European standards and requirements on air emissions of hazardous substances from transport; and the law on environmental impact assessment. The government is currently assessing its capacity to implement CLRTAP protocols and to develop country-specific emission factors for major economic activities. An assessment of the transport emissions and the drafting of relevant national legislation are also underway.

Since 1991, Georgia has adopted several pieces of legislation and regulations to protect natural resources and the environment. Many important presidential and ministerial decrees also regulate air quality. Georgia has systematically submitted reports to relevant international organisations and to the secretariats of the multilateral environmental agreements to which it is a party.

Azerbaijan - Country priorities (Markevych et al., 2014)


Capacity assessment for joining the CLRTAP;

Improvement of legislation on assessment and management of ambient air;

Improvement of the monitoring network;

A study on the impact of transport emissions on the ecosystems, human health and environment in large industrial cities; and

Development of an action plan for the improvement of air quality in the city of Baku.

Georgia - Country priorities (Markevych et al., 2014)


Assessment of the country’s potential to implement international regulations and the three most recent CLRTAP protocols;

Development of a new national air pollution emission inventory methodology;

Development of the air quality national monitoring network; and

Air quality legal and institutional analysis.


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Annex V – Calculations of benefits from improved air quality

To estimate the potential benefits to the EU resulting from improved air quality in the EaP countries, this study relies on the modelling work of the ENPI study (ten Brink et al., 2011), which foresees reducing emissions of the pollutants in Table 9 and Table 10 by 50% from the projected 2020 scenario. The magnitude of this reduction broadly represents what might result from adopting the level of regulatory effectiveness currently being implemented in the EU. The ENPI study (ten Brink et al., 2011) has monetised these benefits in Euros and as a percentage of the projected GDP in 2020. The benefits include domestic (see Table 30) and trans-boundary benefits (see Table 31), since pollutants emitted in one country may have significant impacts on other countries due to their dispersion by atmospheric wind currents.

TABLE 30 DOMESTIC BENEFITS BY EAP COUNTRY IN 2020

EaP countries

€ million PPP15

% of GDP

Low estimate

Central estimate

High estimate

Low estimate

Central estimate

High estimate


Belarus 1,333 2,306 4,323 1.2 2.0 3.8

Moldova 146 253 475 1.4 2.5 4.6

Ukraine 3,845 6,650 12,469 1.2 2.1 3.9

Southern Caucasus

group

Armenia 71 123 231 0.3 0.6 1.1

Azerbaijan 227 393 736 0.3 0.5 0.8

Georgia 57 98 184 0.3 0.5 0.9

Total / average 5,679 9,823 18,419 0.8 1.4 2.5


15

Purchasing Power Parity (PPP equates the purchasing power of different currencies).


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TABLE 31 TRANSBOUNDARY BENEFITS BY EAP COUNTRY IN 2020

EaP countries

€ million PPP % of GDP

Low estimate

Central estimate

High estimate

Low estimate

Central estimate

High estimate


Belarus 348 603 1,130 0.3 0.5 0.9

Moldova 162 280 525 1.6 2.7 5.1

Ukraine 5,492 9,499 17,811 1.7 3.0 5.6

Southern Caucasus

group

Armenia 72 124 233 0.3 0.6 1.1

Azerbaijan 157 272 509 0.2 0.3 0.6

Georgia 71 123 230 0.3 0.6 1.1

Total / average 6,302 10,900 20,439 0.7 1.3 2.4


Any trans-boundary benefits are for the EU Member States and other countries sharing a border with the EaP countries. Only the countries in the EaP Eastern Europe group share land borders with the EU-28; the EaP Southern Caucasus group is too far away from the EU-28 to benefit from any measurable impact. To estimate the benefits to the EU, this study has calculated the length of the border shared with an EU Member State and assumed that the trans-boundary benefits (central estimate) are proportional to this common border length (see Table 32). These results are indicative, as trans-boundary benefits are difficult to calculate; however, they serve to demonstrate the potential importance of such benefits.

TABLE 32 AIR QUALITY TRANS-BOUNDARY BENEFITS FOR THE EU IN 2020


Total trans-boundary benefits

(€ million PPP)

Total border length

Common border length with EU

Trans-boundary benefits for the EU

(€ million PPP) (km) (km) (%)

Belarus 603 3,306 1,456 44 266

Moldova 280 1,390 450 32 91

Ukraine 9,499 5,581 1,324 24 2,253

Total 2,610


In conclusion, improved air quality in the EaP countries could provide the EU with monetary benefits of €2.6 billion per year starting in 2020, provided the emissions of the pollutants are 50% less than their current levels. Most of the benefits (€2.25 billion) come from reductions in Ukraine.


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Annex VI – Biodiversity: current perspective for the EU

The Emerald network is an ecological network that conserves wild flora and fauna and their natural habitats of Europe; it was launched in 1998 by the Council of Europe as part of its work under the Convention on the Conservation of European Wildlife and Natural Habitats or Bern Convention that came into force on 1 June 1982. It is to be set up in each Contracting Party or observer state to the Convention. The EU is also a Contracting Party to the Bern Convention. To fulfil its obligations arising from the Convention, it has set up the Natura 2000 network (based on the Habitats and Bird Directives). The Emerald Network is based on the same principles as Natura 2000 and represents its de facto extension to non-EU countries. As shown in Figure 18 (see candidates Emerald sites), countries in the EaP Eastern Europe group share several natural areas along the 3,230 km of common border with the EU.

FIGURE 18 EMERALD NETWORK PROTECTED SITES

Source: Obretenova et al., 2014

Armenia

Belarus

Azerbaijan Georgia

Ukraine

Moldova


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The Standing Committee to the Bern Convention has endorsed the following work plan:

Phase I: Selection of potential sites suitable for ensuring the long-term survival of the “Emerald” species and habitats (at country level) and delivery of database with scientific information to the Bern Convention Secretariat;

Phase II: Evaluation of the efficiency of the proposed sites done on a species by species and habitat by habitat basis (at (sub)regional and biogeographical level), in cooperation with the European Environment Agency. Submission of the final database site list -after the end of the scientific assessment process- for final adoption by the Bern Convention’s Standing Committee; and

Phase III: Designation at national level of the Emerald sites, for integration into the Emerald Network.

The "Emerald Network of Nature Protection Sites - Phase II" project follows up on the work achieved by a previous Joint EU/CoE Programme, implemented in 2009-2011. It targets the six EaP countries and the Russian Federation and focuses on Phase II of the Emerald Network constitution process, with duration from 2012 until 2016. The following provides details by EaP country on the progress to designate protected sites along with the most significant biodiversity resources identified (Obretenova et al., 2014):

Belarus acceded to the Bern Convention in 2013, in particular thanks to its long-term cooperation with the Council of Europe to set up the Emerald Network. Among the flora and fauna species of European importance in Belarus is the Bison bonasus, the European bison, which makes its home in the ancient forests. Many bird species make their home or migrate through the marshlands such as the black stork, Ciconia nigra, which is also threatened. Plants are represented too, with the memorable Aldrovanda vesiculosa, known as waterwheel plant, a carnivorous aquatic plant. These and other species are found in the 26 habitats of European importance present in Belarus and needing site protection in the frame of the Emerald Network –Belarus has identified 16 sites as suitable to join the Emerald Network; 12 of them have already been officially nominated as candidate Emerald sites by the Standing Committee to the Bern Convention (information last updated in February 2014).

Moldova acceded to the Bern Convention on 24 May 1994, which entered into force the same year. Since the country started working on setting up the Emerald Network, it has listed more than 20 different habitats of European importance needing a specific site preservation, such as the Thermophilous and Supra-Mediterranean oak woods and the Continental Steppe.


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Moldova has identified 18 sites as suitable to join the Emerald Network; 17 of them have already been officially nominated as candidate Emerald sites by the Standing Committee to the Bern Convention. These sites would help preserve habitats for the beautiful lady's-slipper orchid, Cypripedium calceolus, the great crested newt, Triturus cristatus, and the huchen or Danube salmon, Hucho hucho. The largest permanent freshwater salmon and more than 85 other species of plants and animals of European importance [(listed in the Emerald Network Res. 4 (1996) and Res. 6 (1998)] are present in the country and should be protected through the Emerald Network.

Ukraine signed the Bern Convention on 17 August 1998, which entered into force in 1999. As part of its commitment to preserve the country's biological diversity, Ukraine has worked on setting up the Emerald Network since 2008. Ukraine has listed nearly as many threatened habitats for protection as its neighbour Russia. These include dunes, pine forests and cypress, juniperus and yew forests. Examples of Ukraine's precious biodiversity include the wolf, Canis lupus, the great bustard, Otis tarda, the largest game bird in Europe and the Crimean orchid, Steveniella satyrioides. So far, Ukraine has identified 159 sites as suitable to join the Network, 149 of them have already been officially nominated as candidate Emerald sites by the Standing Committee to the Bern Convention (information last updated in February 2013).

Armenia signed the Bern Convention on 13 March 2006, which entered into force in 2008. Since then, the country has worked on setting up the Emerald Network and listed more than 110 species needing protection and habitat conservation, according to the Bern Convention Resolutions No. 4 (1994) and No. 6 (1998). Some of the most emblematic species include the Persian leopard, Panthera pardus, the greater horseshoe bat, Rhinolophus ferrumequinum, and the fern leaf peony, Paeonia tenuifolia. Four different habitats of European importance, such as the Continental glasswort swards, are identified as present in Armenia. Armenia has identified 13 sites as suitable to join the Network (by end 2013); 9 of them have been officially nominated as candidate Emerald sites by the Standing Committee to the Bern Convention (in December 2012).

Azerbaijan acceded to the Bern Convention in 28 March 2000, which entered into force four months later the same year. As of 2010, Azerbaijan has listed more than 160 species of European importance needing to be protected, along with 18 different habitats. The category of fauna or flora that is best represented in sheer numbers on that list is birds. Some of the species listed most recently as part of the country's work on the development of the Emerald network include the goitered gazelle, Gazella subgutturosae, the spur-thighed tortoise, Testudo


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graeca, and luckily Marsilea quadrifolia, commonly known as four-leaf clover. Continental salt steppes and salt marshes are among the habitats of European importance to be protected in the country. Azerbaijan has identified 12 sites as suitable to join the Network (by end 2013); 10 of them have already been officially nominated as candidate Emerald sites by the Standing Committee to the Bern Convention in 2012.

Georgia signed the Bern Convention on 18 May 2009, which entered into force in 2010. As of 2010, Georgia has listed more than 160 flora and fauna species and 15 different habitats in need of protection. Georgia has listed, among others, animals that live in its seas, rivers and wetlands such as the white pelican, Pelecanus onocrotalus, and the European sea sturgeon, Acipenser sturio. Two different types of Habitats in the country need protection, Spiny Mediterranean heaths to Beech forest. Georgia has proposed 21 sites for the Network (by end 2013); 20 of them have been officially nominated as candidate Emerald sites by the Standing Committee to the Bern Convention (in December 2012).


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Annex VII – Eco-industry market: calculations

Support to Environmental Protection Expenditures (EPE) calculations

The average GDP per capita of the six EaP countries is €3,645; this is only around 14% of EU’s average GDP, and 65% of Bulgaria’s GDP, which is the lowest GDP per capita in the EU (see Table 33).

TABLE 33 POPULATION AND GDP PER CAPITA OF EAP COUNTRIES

Country name Population Working

population % of working population

Per capita GDP

$/capita €/capita


Belarus 9,466,000 6,708,895 70.87 $7,575 €5,827

Moldova 3,559,000 2,563,911 72.04 $2,230 €1,715

Ukraine 45,489,600 32,059,443 70.48 $3,900 €3,000

EaP Southern Caucasus

group

Armenia 2,976,566 2,065,797 69.40 $3,505 €2,696

Azerbaijan 9,416,598 6,796,959 72.18 $7,812 €6,009

Georgia 4,476,900 3,030,420 67.69 $3,602 €2,771

Total (population) - Average (GDP/capita)

75,384,664 53,225,426 - $4,738 €3,645

Bulgaria 7,265,115 4,867,834 67.00 $7,296 €5,613

Poland 38,530,725 27,203,317 70.60 $13,432 €10,332

Romania 19,963,581 13,936,057 69.81 $9,499 €7,307

European Union 506,739,265 335,187,008 66.15 $34,244 €26,341

Conversion: €1 = $1.3

Source: World Bank, 2014 (http://data.worldbank.org/indicator)

EPE AS PERCENTAGE OF GDP: OLD AND NEW METHODOLOGIES

The EU eco-industry market study (Rademaekers et al., 2012) explains that the old methodology is based on two “old” studies:

“Links between the environment, economy and jobs" (2007) by GHK in association with

Cambridge Econometrics and IEEP, which looked not just at the direct jobs captured in the eco-industry concept, but also used multiplier effects to calculate the ‘indirect’ jobs created and jobs dependent on a good environment within for example eco-tourism and organic farming; and


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Support to EU’s EaP eco-export calculations The Eurostat/COMEXT database contains both recent and historical data from the EU Member States and a significant number of third countries covering the value of exports and imports of products. The database allows assessing the EU eco-exports to each of the six EaP countries. In 2013, these eco-exports amounted to about €1 million (see Table 34), which is extremely small: only 0.0026% of the total EU exports to the six EaP countries. The numbers were similar in 2012, even slightly higher (4.7%).

"Study on competitiveness of the EU eco-industry" (2009) by Ecorys with IDEA, which

uses a statistically delineated definition relying heavily on EPE and focusing on money spent to protect the environment, but much weaker on jobs that depend on a good environment or on natural resources.

The new methodology has updated some of the indicators in the “old” studies and is based on updated data from Eurostat. This is important (and interesting) as some Eurostat data have been retrofitted when updated, meaning that some historical data have been changed/updated since the publication of the “old” studies. Besides updating the historical data, new data on the relevant variables to calculate employment in the eco-industries have been added to the analysis. The updated methodology and numbers are a better representation of jobs related to the environment for two main reasons:

1. New information has led to changes in EPE. In some cases, the updated numbers have resulted in rather large differences from the results of the “old” studies. Moreover, the updated figures accommodate new methods of estimating EPE in Member States, which also increase the reliability of the figures.

2. The updated methodology reflects the improvements in Eurostat data. The introduction of

new NACE (Nomenclature des Activités Economiques dans la Communauté Européenne) codes allows a better understanding of the metadata underlying EPE. Moreover, issues of double counting in particular in the waste and recycling sectors have been addressed in close cooperation with Eurostat staff. This makes it possible to refine the methodology as well as updating the data sets with reliable data instead of extrapolations and estimations.


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TABLE 34 EU ECO-EXPORTS TO THE SIX EAP COUNTRIES IN 2012 AND 2013

EaP countries EU exports

(€ million) in 2012 EU eco-exports

(€ million) in 2012 EU exports

(€ million) in 2013 EU eco-exports



Belarus € 7,846 €0.72 € 8,619 €0.65

Moldova € 2,038 €0.002 €2,284 0

Ukraine € 23,865 €0.38 €23,939 €0.4

Southern Caucasus

group

Armenia € 683 0 € 718 0

Azerbaijan € 2,994 €0.014 € 3,741 0

Georgia € 2,069 0 €2,034 €0.02

Total € 39,495 €1.12 €41,335 €1.07

Source: Eurostat, 2014 (http://epp.eurostat.ec.europa.eu/newxtweb)

Support to EU’s global eco-exports calculations The EU-27 had a strong export position on nearly all of the world’s largest economies and was, by these measures, the third largest exporter of environmental goods, only just behind Japan (Rademaekers et al., 2012). Especially in the emerging BRIC countries (Brazil, Russia, India and China), the EU had a clear lead compared to other established western economies. Furthermore, the EU was the main importer of environmental technologies, although the magnitude is skewed by the large imports of photovoltaic goods. In 2010, EU’s exports represented 14% of the €47.6 billion trade in environmental technologies and goods (see Table 35).

This 14% share is the same as Japan’s, slightly more than the US’s (12%), but less than China’s (54%). China had the highest export figures for all industries in 2010, primarily thanks to their exports or photovoltaic equipment, which accounts for over 95% of their exports, 1/3 of these exports going to Germany alone.


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TABLE 35 EXTERNAL TRADE FOR ENVIRONMENTAL TECHNOLOGIES AND GOODS IN 2010

Note: Trade flows include air pollution control, hydropower, monitoring equipment, other environmental equipment, photovoltaic, waste disposal and water pollution control.



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Annex VIII – Executive summary in Russian

КРАТКИЙ ОБЗОР

Страны, являющиеся соседями 28 Государств-членов ЕС на востоке – Восточное Соседство – имеют особую политическую и экономическую важность для ЕС, поэтому ЕС проводит политику постепенного укрепления связей с ними. В рамках данного изучения выполняется оценка возможных экологических и экономических выгод для ЕС, которые могут быть получены от усиленного сближения законодательства стран Восточного Партнерства (ВП) – Беларусь, Украина, Молдова, Азербайджан, Грузия и Армения – с экологическим законодательством ЕС. Ухудшение состояния окружающей среды в странах Восточного Соседства имеет непосредственное и очевидное влияние на Государства-члены ЕС. Разные сферы окружающей среды имеют трансграничное влияние. Например, ЕС имеет несколько общих речных бассейнов со странами ВП, совместно использует Балтийское16 и Черное моря, на Государства-члены ЕС оказывает влияние загрязнение атмосферного воздуха со стороны стран ВП; кроме того, ЕС и страны ВП совместно используют ресурсы биоразнообразия. Применение – или нет – экологического законодательства в странах ВП, включая горизонтальное законодательство относительно оценки влияния на окружающую среду, может оказать воздействие на экономику ЕС и предприятия ЕС, которые активно функционируют в странах Восточной Европы. Для оценки и количественного определения (если возможно) основных потенциальных выгод для ЕС касательно экологических улучшений в странах ВП, в рамках этого изучения была проанализирована современная экологическая

16

Хотя ни одна из стран ВП не имеет береговой линии вдоль Балтийского моря, две страны ВП (Беларусь и Украина) находятся в водосборном бассейне, т.е., в них есть реки, впадающие в Балтийское море.

ВП – ВОСТОЧНАЯ ЕВРОПА И ВП – ЮЖНЫЙ КАВКАЗ В целях данного изучения, шесть стран ВП были разделены на две отдельные географические группы:

ВП - Восточная Европа (Беларусь, Молдова и Украина); и

ВП - Южный Кавказ (Армения, Азербайджан и Грузия).

Группа ВП – Восточная Европа имеет общие границы с шестью Государствами-членами ЕС (Латвия, Литва, Польша, Словакия, Венгрия и Румыния). Таким образом, три страны в этой группе имеют больше общих непосредственных водных, морских, воздушных ресурсов и ресурсов биоразнообразия с Государствами-членами ЕС, чем страны группы ВП – Южный Кавказ. Тем не менее, страны группы ВП – Южный Кавказ совместно используют значительные торговые связи с ЕС, а также экологический ресурс: Черное море.


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ситуация в странах ВП и составлен прогноз (если возможно) вероятной ситуации в 2020 году в следующих шести сферах:

1. Качество воды; 2. Прибрежные зоны; 3. Качество атмосферного воздуха; 4. Биоразнообразие; 5. Управление отходами; и 6. Торговля.

На основе результатов, представленных в данном изучении, можно сделать три основных вывода:

1. Страны ВП и ЕС могут получить значительные выгоды от улучшения состояния окружающей среды в странах ВП

Страны ВП и ЕС получат выгоды от улучшения состояния окружающей среды в странах ВП и такие выгоды будут значительными, даже, если некоторые из них трудно определить в количественном измерении ввиду отсутствия в литературе изучений относительно ухудшения состояния окружающей среды. ЕС может ожидать получение выгод в размере, как минимум, 8 млрд. евро в год по состоянию на 2020 г.: 2.6 млрд. евро от улучшения состояния окружающего воздуха вследствие сниженной смертности и заболеваемости, а также 5.4 млрд. евро от улучшения качества воды при условии, что потребители будут готовы платить за нее. ЕС должен также получить выгоды от увеличенных поступлений от эко - торговли в размере 51 млн. евро в год, что равнозначно 434 рабочим местам. Другие выгоды могут быть получены от улучшенного состояния прибрежной окружающей среды, увеличенного биоразнообразия и усовершенствованного управления отходами. Шесть государств ЕС, которые граничат со странами ВП (Румыния, Венгрия, Словакия, Польша, Литва и Латвия) имеют хорошие шансы получить максимальные выгоды.

2. Предварительные признаки определения приоритетных сфер деятельности

Настоящее изучение является первой пояснительной оценкой выгод, которые, как ожидается, будут получены от улучшения состояния окружающей среды в странах ВП. Например, в изучении показано, что максимально ожидаемые выгоды могут быть получены в сферах водных ресурсов и атмосферного воздуха. Это вполне вероятно, поскольку в отношении данных двух секторов в литературе существует большое количество изучений. Подобным образом, в рамках этого изучения предлагается, чтобы улучшения в Украине дали максимальную выгоду; причиной этого, главным образом, является то, что Украина считается самой большой и наиболее населенной страной ВП. В изучении также подчеркнуто, что страны ВП и ЕС могут получить выгоды от решения таких острых проблем, как устаревшие пестициды в различных районах Молдовы или контейнеры с опасными отходами в


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Беларуси. Однако, количественное определение рисков таких острых проблем или выгод, которые могут быть получены от их решения, не входит в сферу данного изучения.

3. Ожидаемые выгоды, которые могут стать реальностью только в том случае, если страны ВП улучшат состояние своей окружающей среды

Неудивительно, что первыми странами, которые получают выгоды от улучшения состояния окружающей среды в странах ВП, являются сами страны ВП. В общем, граждане стран ВП могут получить выгоды от экономии затрат и улучшенного качества жизни. Такие выгоды могут быть значительными, например, 9 млрд. евро в год благодаря только улучшенному качеству атмосферного воздуха. С целью улучшения экологической ситуации страны ВП должны увеличить инвестиции в более эффективные процедуры выработки политики в сфере окружающей среды, в процесс внедрения, финансирования и принудительного внедрения. Страны ВП должны усовершенствовать свои национальные экологические стратегии/задачи и оказать поддержку их выполнению для восприятия трансграничных выгод. Как ЕС может оказать поддержку странам ВП в этом процессе? ЕС уже оказывает поддержку странам ВП многими способами (например, трансграничное сотрудничество, региональные программы в области окружающей среды, финансовая поддержка благодаря инвестициям от ЕИБ, техническая помощь и проведение переговоров с целью заключения торговых соглашений). Таким образом, основное требование состоит в том, чтобы усилить и ускорить оказание поддержки странам ВП со стороны ЕС. В этом изучении определены три рекомендации для ЕС с целью оказания поддержки странам ВП в улучшении состояния их окружающей среды:

1. Оказание поддержки странам ВП в определении приоритетных сфер для успеха

Для определения приоритетных сфер для успеха страны ВП должны улучшить качество существующих экологических данных и показателей; такие улучшенные данные, в свою очередь, дадут возможность выполнить детальный анализ затрат и результатов. Улучшение качества данных должно быть обеспечено путем осуществления следующих мероприятий:

Усовершенствование Общей системы экологической информации ЕС (ОСЭИ) для улучшенных экологических данных и показателей; и

Выполнение детального анализа затрат и результатов для определения эффективности затрат на проведение улучшений в различных сферах окружающей среды.


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2. Оказание поддержки странам ВП в улучшении их экологической ситуации

Много острых проблем в странах ВП требуют немедленного решения, особенно, те, которые являются актуальными на границе между одной из стран ВП и Государством-членом ЕС. В большинстве случаев, любые улучшения экологической ситуации в странах ВП пойдут на пользу этим странам и ЕС. Таким образом, ЕС должен усилить свою поддержку путем:

Осуществления трансграничного сотрудничества. Комиссия должна обеспечить разработку и выполнение соответствующих программ в области трансграничного сотрудничества, направленных на достижение приоритетных целей в рамках Задачи 6 (охрана окружающей среды, смягчение изменения климата и адаптация).

Увеличения финансовой помощи через ЕИБ. Энергоэффективность, возобновляемая энергия, устойчивый транспорт, городская инфраструктура и водные ресурсы были определены как сферы, где существует необходимость значительного инвестирования в регионе.

3. Продолжение обеспечения смягчения любых неблагоприятных

воздействий на окружающую среду благодаря заключению будущих торговых соглашений

ЕС и страны ВП в настоящее время обсуждают возможность усовершенствования торговых соглашений с включением в них экологических компонентов. Страны ВП уже взяли на себя или вскоре возьмут значительные обязательства относительно содействия высоким стандартам в области охраны окружающей среды с целью эффективного внедрения экологического законодательства и частичной не отмены таких законлв для привлечения инвестиций. Страны ВП будут также стремиться к корпоративной социальной ответственности, уделяя особое внимание экологическому менеджменту в ключевых сферах экспорта. Экспортеры стран ВП достигли успехов в области экологического менеджмента, улучшая имидж стран ВП, как надежных поставщиков, и обеспечивая доступ к международным рынкам. Комиссия должна и в дальнейшем гарантировать, что все существующие и будущие торговые соглашения полностью учитывают необходимость смягчения любых неблагоприятных воздействий на окружающую среду.


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Annex IX – Abstract in Russian

РЕЗЮМЕ

В рамках данного изучения выполняется оценка возможных экологических и экономических выгод для ЕС, которые могут быть получены от сближения законодательства стран Восточного Партнерства (ВП) – Беларусь, Украина, Молдова, Азербайджан, Грузия и Армения – с экологическим законодательством ЕС. В результате изучения можно сделать вывод, что страны ВП и ЕС получат выгоды от улучшения состояния окружающей среды в странах ВП и такие выгоды будут значительными, даже, если некоторые из них трудно определить в количественном измерении ввиду отсутствия в литературе изучений относительно ухудшения состояния окружающей среды. ЕС может ожидать получение выгод в размере, как минимум, 8 млрд. евро в год по состоянию на 2020 г.: 2.6 млрд. евро от улучшения состояния окружающего воздуха вследствие сниженной смертности и заболеваемости, а также 5.4 млрд. евро от улучшения качества воды при условии, что потребители будут готовы платить за нее. ЕС должен также получить выгоды от более интенсивной торговли, улучшенного состояния прибрежной окружающей среды, увеличенного биоразнообразия и усовершенствованного управления отходами. Однако такие ожидаемые выгоды станут реальностью только тогда, когда страны ВП увеличат инвестиции в более эффективные процедуры выработки политики в сфере окружающей среды, в процесс внедрения, финансирования и принудительного внедрения. Таким образом, в рамках данного изучения рекомендуется, чтобы ЕС усилил и ускорил оказание существующей поддержки странам ВП в следующем:

1. Определении приоритетных сфер для успехов;

2. Улучшении состояния их окружающей среды; и

3. Продолжении обеспечения смягчения любых неблагоприятных воздействий на окружающую среду благодаря заключению будущих торговых соглашений.

Настоящее изучение является первой пояснительной оценкой выгод. Например, в изучении показано, что максимально ожидаемые выгоды могут быть получены в сферах водных ресурсов и атмосферного воздуха. Это вполне вероятно, поскольку в отношении данных двух секторов в литературе существует большое количество изучений. Подобным образом, в рамках этого изучения предлагается, чтобы улучшения в Украине дали максимальную выгоду; причиной этого, главным образом, является то, что Украина считается самой большой и наиболее


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населенной страной ВП. В изучении также подчеркнуто, что страны ВП и ЕС могут получить выгоды от решения таких острых проблем, как устаревшие пестициды в различных районах Молдовы или контейнеры с опасными отходами в Беларуси. Однако, количественное определение рисков таких острых проблем или выгод, которые могут быть получены от их решения, не входит в сферу данного изучения

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