In order to successfully implement the necessary environmental investments by the date of accession, the ten candidate countries have been asked to prepare realistic national environmental investment strategies based on the National Programmes for the Adoption of the Acquis (NPAA). A regional accession-driven environmental investment strategy, Priority Environmental Investment Programme for Accession, or PEPA, will be developed, which utilises these national strategic documents. The European Commission is currently mobilising a specific team to help the candidate countries in the PEPA development; the team is to be in place in early 2000. The REC participates in this team by supporting the development of local project pipelines to be used as an input to the regional strategy.

To assist the successful preparation and implementation of the environmental investment strategies, four regional seminars have been organised by the REC, in close cooperation with the European Commission (Dialogue Groups XI and XVI). The participants of the first seminar, held in November 1998 in Szentendre, agreed that it was necessary to prepare the regional programme for environmental accession-related investments based on national accession-driven strategies. The second seminar took place on April 19-20, 1999 in Szentendre and brought together more than 100 participants to discuss the current state of the development of accession strategies. The third regional seminar was held on October 15, 1999, and monitored progress in the national accession-related investment strategies development. The fourth seminar took place on June 30 and July 1, 2000, also in Szentendre; it introduced and endorsed the draft PEPA Strategy .

Over the past several years, environmental funds in Central and Eastern Europe (CEE) have played a noticeable role in financing environmental investments in their respective countries. All CEE candidate countries, with the exception of Romania, Estonia and Hungary, have environmental funds (both Hungary and Estonia formally dissolved their funds in 1999 but continue to earmark the revenues of environmental charges for environmental investments). In the framework of the EAP Task Force activities, guidelines - the St. Petersburg Guidelines on environmental funds in the Transition to a Market Economy -  for sound management of the funds have been developed. The guidelines identify the criteria that the funds should apply in order to be environmentally effective, economically efficient and financially rigorous public sector institutions.

The EU Phare Project Preparation Fund (PPF) and OECD have jointly developed and implemented a Technical Assistance project (1977-1999) to strengthen and improve the funds' capacity to adhere to the principles and criteria elaborated in the St. Petersburg Guidelines (OECD, 1995). This project has been recently completed but it is evident that much remains to be done. The funds continue to face additional challenges related to their potential role in financing accession-related investments and the need to comply with procedures of external funding agencies and with guidelines for public institution expenditures within EU legislation.

As Secretariat of the Sofia Initiative on Economic Instruments (SIEI), the Regional Environmental Center (REC) has also developed a network of experts within the Ministries of Environment in the 10 Accession Countries reviewing the role of environmental charges and non-compliance fees within the national and local environmental fund systems. With the exception of the Slovenian Development Fund and the Debt for Nature funds in Poland and Bulgaria, domestic economic instruments play a significant role in generating revenues for the funds. A systematic review of the role of the funds within the broader environmental policy context in CEE countries should necessarily consider future trends in the application of public participation programmes through environmental taxes and charges. Linkages between the activities of the SIEI and the Environmental Funds Network have already been established under the EAP Task Force and these linkages, including direct expert involvement, will be further emphasised within REAP.

Summarising the above, Task 19 is to be considered a follow-up and an extension of all related activities so far undertaken by the EC, OECD and REC in supporting the accession-related efforts made by the ten candidate countries. It meets the objectives given in the terms of reference and follows the needs of the ten EU candidate countries. In addition, REC is in a position to multiply the impact of the accession-related environmental funding by transferring experience gained through the above projects to the South Eastern European (SEE) region though parallel and future projects funded by other sources. These projects are to be implemented in the framework of the Regional Environmental Reconstruction Programme (REReP) for SEE.