The main objective of this European Bank for Reconstruction and Development (EBRD)/Food and Agriculture Organization (FAO)/Global Environmental Facility (GEF) pilot project is to promote investments in private sector/industry through the utilization of private financial intermediaries. The project supports the implementation of investment projects of the ICPDR Joint Action Plan (2001-2005) offering significant opportunities for the reduction of the nutrients loads in the Danube River Basin.
There is an increasing need for environmental investments in Slovenian industrial and municipal sector in order to comply with national legislative deadlines and EU requirements for emissions reduction. However, there are several barriers that both sectors face in accessing funding sources that are mainly related to the difficulties in financing large investments by many of small Slovenian municipalities and to the new State Aid regulations that restrict the financing of industrial pollution reduction investments with wastewater tax reduction funds.
Slovenia still faces significant challenges, including industry restructuring, privatisation of its largest banks and major public utilities, liberalisation of foreign capital regulations, and development of a local capital market.
The EBRD will focus on helping Slovenia to address the remaining European Union challenges, including enterprise restructuring and privatisation of larger banks and public utilities. The EBRD will respond to the needs of the market through flexible and innovative products, with an emphasis on foreign direct investment and greenfield investments. Therefore, in order to reach small and medium sized enterprises, the EBRD provides finance to local banks (financial intermediaries or FIs) who then on-lend smaller amounts of money to local businesses. It is considered that the projects in the industrial and agriculture sectors are the most suitable for commercial co-financing by FIs.
Eligibility of environmental investment projects will be assessed on the base of set of criteria that include environmental dimensions. The results of the ongoing EU DABLAS work on prioritisation of the environmental projects in the municipal sector addressing nutrient reduction goals can be used for establishing the priorities for co-financing by FIs in Slovenia.