2022 GATF Annual Meeting - Item 3 - COVID Assessment on environmental recovery measures in EECCA
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Presentation on the environmental effects of the COVID-19 related recovery measures in the EECCA region.
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2022 GATF Annual Meeting - Item 3 - COVID Assessment on environmental recovery measures in EECCA
- 1. THE ENVIRONMENTAL EFFECTS OF COVID-19 RELATED RECOVERY MEASURES IN THE EECCA REGION Isabella Neuweg, Policy Analyst, Environment Directorate, OECD Annual Meeting of the GREEN Action Task Force Tbilisi, 30th June 2022
- 2. Why do we care about green recovery spending • COVID-19 took a large human and economic toll on EECCA countries; EECCA countries reacted swiftly; • Large sums were spent on recovery measures; • Will they deliver on the promise of a green recovery, setting the stage for countries to “build back better”? 2 Total recovery spending USD billion Recovery spending as % of GDP Armenia 0.4 1% Azerbaijan 2.2 1% Georgia 1.0 2% Kazakhstan 34.1 7% Moldova 0.4 1% Ukraine 3.5 1% Uzbekistan 1.2 0.5% Environmentally positive measures as % of total recovery spending 2.6% 0.9% 1.8% 0.4% 0.2% 0.0% 14.4% Source: ENV-EPOC-EAP(2022)4 Green Recovery, 2022
- 3. Identified gap of data on EECCA 3 A number of trackers available, e.g.: - OECD Green Recovery Database: 44 countries; - The Oxford-led Global Recovery Observatory: 50 major economies; - UN COVID-19 Gender Response Tracker; - The Energy Policy Tracker: 30 major economies and the Multilateral Development Banks, etc. Source: Oxford Global Recovery Observatory
- 4. What we did - Identified more than 300 policy measures in response to the COVID-19 pandemic across eleven EECCA countries; - Assessed these on whether they had clear positive, negative or mixed environmental impact; also included those which supported existing infrastructure in the analysis; - Focus on monetary values of recovery measures; - Included both public budget allocations by EECCA countries and financial resources provided by international cooperation partners. 4
- 5. Results: Total recovery funding 5 0 200 400 600 800 1 000 1 200 1 400 1 600 1 800 2 000 Positive Neutral/existing infrastructure Mixed+Negative USD millions Positive Neutral/existing infrastructure Mixed Negative Total recovery funding allocated in EECCA by environmental categorization: 9% green In OECD and G20 countries Source: OECD Green Recovery Database, 2022 Source: ENV-EPOC-EAP(2022)4 Green Recovery, 2022
- 6. Total recovery funding by sector 6 0 200 400 600 800 1 000 1 200 Energy Aviation Ground transport Industry Agriculture Forestry Waste management Mutilple or Economy- wide USD millions Positive Neutral/existing infrastructure Mixed Negative Source: ENV-EPOC-EAP(2022)4 Green Recovery, 2022
- 7. Dimensions of environmental impact 7 Environmental impacts of recovery measures in the EECCA region concern climate mitigation, water, biodiversity and air pollution 0% 50% 100% Other Waste & recycling Water Climate Adaptation Biodiversity Air pollution Climate Mitigation Positive Mixed Negative Source: ENV-EPOC-EAP(2022)4 Green Recovery, 2022
- 8. Volume of green spending 8 Volume of environmentally positive recovery measures in EECCA as share of total recovery spending 0% 2% 4% 6% 8% 10% 12% 14% 16% ARMENIA AZERBAIJAN GEORGIA KAZAKHSTAN MOLDOVA UKRAINE UZBEKISTAN Source: ENV-EPOC-EAP(2022)4 Green Recovery, 2022
- 9. Total funding by environmental categorisation and country 9 Total recovery funding allocated in EECCA by environmental categorisation and country 0 500 1 000 1 500 2 000 2 500 ARMENIA AZERBAIJAN GEORGIA KAZAKHSTAN MOLDOVA UKRAINE UZBEKISTAN USD millions Volume of positive measures Volume of mixed measures Volume of neutral/existing infrastructure measures Volume of negative measures Source: EECCA Green Recovery Database, 2022
- 10. Summary • Quite significant COVID-19 spending with negative environmental impact in EECCA -> Recovery measures currently not/ only partially aligned with carbon-neutrality and NDC targets; • Large scope to harness opportunities of a green recovery, e.g. through improved energy security. 10
- 12. Discussion questions • Looking back at 2021, what have been the main barriers to including more green measures in economic recovery packages? What role could international partners, including the OECD, play in overcoming these barriers? • The Russian Federation’s aggression against Ukraine and its consequences are adding to the challenges of COVID-19 recovery efforts and pose immediate challenges for EECCA governments. To what extent has it affected green economic planning for 2022 and beyond? • What are the priority areas for further reform in your country to ‘build back better’ towards a greener, more resilient and inclusive economy? How could further analysis from the GREEN Action Task Force support these reforms? 12
Editor's Notes
- COVID-19 has had a huge impact on EECCA countries, and countries reacted swiftly. Large spending recovery plans were launched; It is important to ask what parts of that money contribute to wider environmental plans and possible negative effects on the environment.
- Seven environmental dimensions of recovery measures were considered (up to three per measure) drawing from climate change mitigation, climate change adaptation, air pollution, biodiversity, water, waste & recycling and plastics.
- The size of financial allocations with an estimated environmental effect as share of the overall recovery spending shows that EECCA countries have allocated far less towards green measures compared to OECD and G20 countries (where more than 30% of total recovery spending was allocated to environmentally positive measures (OECD, 2022[3])). Figure 6 shows the spending with an environmentally positive effect as a share of total recovery packages in the seven EECCA countries. Also in relation to its overall recovery spending, Uzbekistan had the highest green recovery spending. More than 14% of overall recovery spending in Uzbekistan is green. In Armenia almost 3%, in Georgia almost 2% and in Azerbaijan almost 1% of total stimulus packages is estimated to be green.
- In Uzbekistan by far the largest amounts were allocated to measures with an environmental impact; around USD 2.2 billion with both the largest size of positive measures and the largest size of negative measures. Box 2. Examples of recovery measures with positive environmental impact In Armenia, the Caucasus Nature Fund provided a grant to finance national parks, forest state reserves and biosphere complexes as support to mitigate the impacts of COVID-19. In Azerbaijan, a recovery measure financially supported sustainable land management in salt-affected areas in the Absheron Peninsula. The project aims to support national targets on land degradation neutrality through effective land management, leading to sustainable dryland agriculture and farming. In Georgia, the programme budget for support to Micro, Small and Medium Enterprises (MSMEs) that are particularly innovative and green was increased by 400% in 2020. In Kazakhstan, large-scale tree-planting efforts started in 2021 with the aim of two billion new trees by 2025 . In Moldova, grants were issued for women-headed households, women entrepreneurs and rural communities to build resilience to climate change and implement environment-friendly practices. In Ukraine, a recovery measure supported capacity building for green hydrogen. In Uzbekistan, credit lines to commercial banks provided finance to exporters and small and medium-sized enterprises to improve the energy efficiency of their businesses.
- Summary: we have seen quite significant COVID-19 spending with negative environmental impact; It will be important to ensure close monitoring of the impacts of recovery measures; this serves also the purpose of making future recovery responses aligned with climate targets and ensure that they at least do not jeopardise other important social, economic and environmental policy objectives; There is a related, but different purpose of tracking the effects of recovery efforts in general, and that is to assess their effectiveness. Did the money spent and will the money that will still be spent serve its intended objective? There are some ways of measuring this, like doing a survey of respondents amongst targeted recipients, like SMEs, for example; I am not aware if countries have launched impact assessments or any kind of impact assessments– so this would be interesting to hear about. I will stop here and look forward to the discussion, which I hope will give us more insights on the challenges countries have experienced in greening their recovery responses and the opportunities they see.