On October 17, 2023, the Cabinet of Ministers approved the draft regulations* developed by the Ministry of Environmental Protection and Regional Development on support for the development of public infrastructure necessary for business, promoting the transition to a climate-neutral economy in the regions most affected by the socio-economic consequences. The total support is expected from the Just Transition Fund (JTF) in the amount of 49 million euro, which will be directed to the projects in accordance with an open tender.
"The adoption of these regulations will make it possible to improve business areas, restore buildings, create access roads, street lighting, rainwater drainage, etc. As a result of these projects, the infrastructure needed by entrepreneurs must be created, which will allow them to create at least 400 new jobs in the next six years and attract private investments of almost 33 million euro. The experience so far in the implementation of similar programs has proven that investments in public infrastructure develop economic activity in regions, attract people to local areas and improve the overall quality of life," emphasizes Minister of Environmental Protection and Regional Development Inga Bērziņa.
The support is intended for the municipalities of Latgale, Vidzeme, Zemgale and Kurzeme statistical regions, their institutions and joint-stock companies, as well as special economic zone administrations, for the creation of public infrastructure, including traffic infrastructure, business buildings, territories and industrial connections necessary for the promotion of economic activity in municipalities.
Investments are planned in accordance with the Latvian National Development Plan 2021-2027, Regional Policy Guidelines for 2021-2027 and the Just Transition Platform.
As part of the event, it is planned to improve the business environment by investing JTF funding in the public infrastructure necessary for business, as a result of which it is planned that merchants who will benefit from the created infrastructure will create at least 422 new jobs and make private investments of at least 32.9 million euro in its economic activity, creating positive incentives for the promotion of employment and economic development in the regions.
Project selection will be organized in the form of an open competition. As part of the competition, priority will be given to those projects that demonstrate a higher return on jobs and non-financial investment indicators compared to the JTF funding invested in the project, and also provide that the activities planned in the project are aimed at "greener business" merchants (i.e. merchants who implement projects for the "greening" of business) and "higher potential" traders (i.e. smart specialization areas and export-capable traders, producers of innovative products or high added value products and traders where the average salary of employees exceeds the average salary in the relevant economic sector in the relevant region). Preference will also be given to those projects that envisage investments in technologies using renewable energy resources for energy self-consumption and investments in historical peat mining areas or industrial areas, reducing further environmental degradation. As part of the event, high readiness projects with developed construction projects will be supported.
The Central Finance and Contracting Agency, as a cooperation institution for European Union funds, plans to announce the selection of project submissions this year, at the end of November.
In the long term, this measure will contribute to the balanced development and transformation of the regions towards climate neutrality.
*European Union cohesion policy programs for 2021-2027 6.1.1. of the specific support objective "Mitigating the economic, social and environmental consequences of the transition to climate neutrality in the most affected regions" 6.1.1.3. implementation rules of the measure "Support for the development of public infrastructure necessary for business, promoting the transition to a climate-neutral economy"
