Last week, the Estonian capital hosted the 5th annual Trimory Summit, an association of Eastern European EU member states in which Ukraine wants observer status.

Although Kyiv has never heard a political signal, the decisions made in Tallinn kicked off Ukraine's actual participation in the union.

What has Kyiv gained, how is the Trimorye project developing - and what are the tasks set for the next summit to be held in Bulgaria in 2021?

Investment projects worth 22 billion euros

One of the achievements of the summit was the presentation to the Investment Fund of the Three Seas - an idea that was expressed during the Bucharest Summit in 2018.

In May 2019, the founding act on the establishment of the Fund was signed, and this year the number of its members has increased to nine, and the capital - to 913 million euros (it is planned to attract 3-5 billion euros).

In particular, US Deputy Secretary of State Keith Cracch confirmed the words of his boss Mike Pompeo about the US intention to invest $ 1 million. In addition, Washington will contribute an additional 30% of the total contribution of all States Parties to the Initiative.

Funds from the Fund will be directed to the implementation of infrastructure projects in the fields of energy, transport and digitalization.

According to an IMF report in September, infrastructure financing needs in the region are € 1.15 trillion. To cover half of this amount, it is necessary to allocate from 3 to 5% of GDP within ten years.

Great importance is attached to the support of the Fund to private investors and their encouragement to make contributions along with state funding.

The key issue is to encourage private investors to participate. From the given figures it is possible to understand that activity of participants is not high both because of the general economic situation, and because of a pandemic.

Note that following the Tallinn Summit, the list of 48 priority projects was expanded.

As a result, the total number of Trimorje projects has increased to 76 with a total cost of more than 22 billion euros.

As for the implementation of already identified projects, the published report called three projects fully completed.

Significant progress has been made in 14 of them, and seven are in the process of being implemented. The vast majority of projects are listed in the column "registered".

Smart Connectivity

During the third panel of the summit, Estonian President Kersti Kaljulaid presented the concept of Smart Connectivity. It combines energy and transport infrastructure with digital platforms and services to better manage related infrastructure.

The goal of Smart Connectivity is to transform the Three Seas region into a global hub for smart mobility and energy innovation. The main components of Smart Connectivity are Smart mobility and Smart energy.

In the context of the implementation of Smart mobility throughout the Trimor region, it is planned to build smart transport corridors (smart roads and railways, logistics centers), which will move self-driving autonomous vehicles. Particularly good prospects are seen for freight transport, where the entire supply chain can be automated. This will significantly reduce the need for human labor and unnecessary bureaucracy.

Smart energy provides coverage of the region with smart energy networks, as well as the widespread use of innovative technologies in renewable energy sources. Thanks to the latter, citizens will be not only consumers of energy resources, but also producers.

The Smart Connectivity concept is planned to be applied to existing projects within the Trimory. In particular, among the first are projects for the construction of LNG terminals on the coasts of Poland and Lithuania and the project of the railway route Rail Baltica.

What did Ukraine get?

The issue of possible involvement of new participants in the Three Seas Initiative was also discussed at the summit.

The Presidents of Estonia, Poland and Bulgaria stressed that membership in the Initiative is open only to EU member states, but allowed the possibility of discussing other formats of cooperation with countries outside the European Union, primarily Ukraine and the Western Balkans. What exactly these formats can be, it was not specified.

However, according to Estonian President Kersti Kaljulaid, if successful, the Investment Fund model can be used for countries outside the EU, in particular to finance projects in Ukraine.

If at the Tallinn summit Ukraine did not receive political signals to change its status in the Three Seas Initiative, then in practical terms it can participate in projects.

Among the 28 new projects approved at this year's summit, four provide for Ukraine's possible participation (three projects proposed by Hungary, one by Poland).

Among them: construction of a new bridge and border crossing over the river Tisza between the cities of Záhony (Hungary) and Chop (Ukraine); construction of new railway lines between the main Polish cities and neighboring countries; use of gas interconnector capabilities between Slovakia and Hungary; increasing the capacity of the gas corridor between Romania and Hungary.

In all projects, Ukraine is not mentioned as a participant, but as a partner. However, the specific participation and scope of Ukraine's work in the project description are not specified.

Accordingly, we must demonstrate our interest in the implementation of projects and their extension to Ukrainian territory.

And then the next summit, which is to take place next year in Bulgaria, may be even more successful for Kyiv.

 

Authors: Vyacheslav Golub, Rostislav Tomenchuk,

Ukrainian Institute of International Politics

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Posted in Economics