Policy brief: GREEN RECOVERY

For Poland, the biggest recovery challenge is not associated with the disbursement process of the available EU funds, but ensuring that the projects and reforms identified by the National Recovery and Resilience Plan answer to the strategic challenges of the XXI century’ – write Maciej Bukowski, Zofia Wetmańska and Paweł Leszczyński, authors of the new policy brief ” Green Recovery.  From crisis to sustainable recovery”

Recommendations for policymakers:

• Systemic problem-solving approach: Current reforms, including these focused on the launch of the second phase of the national Anti-Crisis Shield and disbursement of the EU funds from Recovery and Resilience Facility, must strive not only to achieve short-term economic goals, but also to strengthen the European and national economy in a systemic way.
• Strategic adaptation to megatrends:It is necessary for the government to adopt the Strategy for the Transformation to a Climate Neutral Economy along with the sectoral documents that it implies. These documents should not only be internally consistent, but also define in a measurable manner the directions of the country’s development at macroeconomic and sectoral levels: they should contain specific indicators and goals for designing support instruments and monitoring the progress of their implementation.
• Targeting investments that are needed to unlock large-scale changes in key sectors in the National Recovery and Resilience Plans: Projects selected for National Recovery and Resilience Plans should be based on uniform selection criteria. These could be taken for example from the European Taxonomy for sustainable activities. At the same time, the process of designing Recovery Plans should take into account quantification of the extent to which implementation of Plans will contribute to the achievement of the 2030 climate targets and digital policy goals.
• Urgent reforms aimed at eliminating contradictions between development and recovery policies:It is necessary to introduce regulatory changes that would enable alignment of domestic policies with the EU objectives. In particular, it is urgent to introduce green and digital criteria in the process of evaluation of eligibility of given investments for public support in the second edition of the Anti-Crisis Shield. Furthermore, measures that liberalize the regulatory environment of investments in RES, would help to fast-pace the low-carbon transition.
• Assessment of investment compliance with the EU Taxonomy for sustainable activities as one of project selection criteria: This will allow to avoid the problem of “greenwashing” by clearly defining which projects will contribute to the decarbonisation of the Polish economy. The use of the Taxonomy will additionally help with the tracking of financial flows supporting the development of low-emission investments, and thus the process of accounting for the share of green investments in the European funds spending structure.
• Building synergies between central and local governments: Since a significant part of public funds in Poland is disbursed through local governments, it is necessary to take into account their needs while developing the post-COVID-19 economic stimulus. Increasing the fiscal autonomy of cities and local authorities as well as developing a central mechanism (e.g. a Fund) aimed at providing access to funds for strategic investments could ensure that actions at the central and local levels become complementary.