06-09-2024
Developments in green finance: from a vision of the future to billions of investments already planned
The Green Deal, digitalisation and education are among the top three priorities of this Government, which complement each other and increase their potential. The focussed and consistent work of the Ministry of Finance in recent years has resulted in green finance becoming billions of planned investments, which will allow to increase the resilience and competitiveness of the Lithuanian economy – Vice-Minister of Finance Vaida Česnulevičiūtė–Markevičienė underlined in the discussion organised by Verslo Žinios.
“Investing in the green economy is Lithuania’s top funding priority for the decade – it is estimated that Lithuania needs to mobilise at least EUR 31 billion by 2030 to achieve climate change mitigation and adaptation objectives, of which EUR 13.88 billion is planned to be covered by public finances. The green transformation, together with digitalisation, innovation and science, will allow the Lithuanian economy to move towards the creation of high-added-value goods and services while maintaining the country’s economic growth once the income of the population has reached and exceeded the EU average level,” Vice-Minister of Finance Vaida Česnulevičiūtė–Markevičienė said.
She stresses that the growth of the Lithuanian economy in recent decades has been mainly based on the low-cost competitiveness model. After Lithuania has experienced a period of strong economic growth and has reached the level of average EU income, we can continue to grow and remain competitive only by strengthening specialisations, developing competences and being innovative.
The implementation of the Green Deal will allow Lithuania not only to comply with international environmental commitments, but also to become more competitive and less dependent on imports of raw materials. Lithuania is the first EU country to stop importing Russian fossil fuels, we currently produce more than a third of our own electricity from renewable energy sources (RES) and aim to have all electricity produced from RES by 2030.
In 2024 alone, a total of EUR 1,057 million has been earmarked for active and upcoming green finance calls for business, with the largest funding stream foreseen for activities related to the transition to a climate-neutral economy. Business experimental activities, the development of environmentally friendly products or technologies will be funded. The largest amount of funds (EUR 638 million) has been allocated to produce electricity from RES, greening of enterprises (EUR 229 million) and the use of RES to produce heating and cooling in central heating networks (EUR 77 million). More information about the calls for proposals can be found here.
The Ministry of Finance prepared, and the Government approved a draft amendment to the Law on Securities, which enshrines the European Green Bond Standard. This standard aims to make it easier for private companies and the state to attract finance for sustainability-related investments. Investors are given more incentives to invest in higher quality green projects and assets. At the same time, it will provide an opportunity for Lithuania to accelerate the transition to a sustainable economy and strengthen its position in both the European Union and global financial markets.
The implementation of the planned green transition measures (2023-2030) would bring real and tangible benefits to the whole country.
It is estimated that Lithuania's GDP would be, on average, by 1.84 % higher, that the number of employed persons in Lithuania would increase by 1.69 % or 23.6 thousand, and that the percentage of people unable to heat their homes sufficiently in Lithuania would be by 3.75 % lower.