EC approves amendments to Latvia's 2021-2027 EU funds program to strengthen security

RIGA - The Finance Ministry this week received a decision of the European Commission (EC) on the approval of amendments to the European Union (EU) funds program for 2021-2027 to strengthen security, the ministry informed LETA.

The approval of the amendments means that Latvia will be able to take advantage of the opportunities offered by the EC's ReArm Europe Regulation by allocating EUR 470 million or 10 percent of the existing EU funds program to security and defense needs, including investments in the development of business and military mobility.

At the same time, the implementation deadline for all projects under the program will be extended by one year to the end of 2030, which is particularly important for large-scale infrastructure projects, ensuring a time reserve for their quality implementation.

According to the Finance Ministry the amendments incorporate all the reallocations already approved by the government in the spring - only the approved amendments clarify and restructure them into new specific support objectives, in line with the ReArm Europe framework.

A total of EUR 34 million is earmarked for improving industrial capabilities in the defense sector, including investments from the existing EU funding measure STEP (Strategic European Technology Platform) Investments for Entrepreneurship.

Further EUR 54.9 million are earmarked for infrastructure to attract renewable energy producers, including investments in the Kundzinsala infrastructure project.

Another EUR 35 million are planned to strengthen energy independence, including investments from existing EU funding measures in the renewable energy, biomethane and energy sectors.

Also, EUR 53.4 million are earmarked for dual-use infrastructure and strengthening civilian capabilities, including investments in the Selija military field, the Daugavpils Bridge, cyber security and missile defense measures.

EUR 245.9 million are earmarked for strengthening military mobility and defense infrastructure, including investments from port infrastructure and the construction of the Rail Baltica Riga Airport link between Riga Airport - Riga Central Station - Aizkraukle.

In addition, EUR 46.8 million are earmarked for improving civil protection capabilities, including investments in disaster management centers and shelters.

The amendments also include additional reallocations of EUR 10.6 million for the reconstruction of the Latvian Oncology Centre (LOC) operating theatre and intensive care unit, as well as almost EUR 9.5 million for the development of the EU's external border region, including EUR 5 million for business infrastructure and EUR 4.5 million for school infrastructure.

However, following the Cabinet's decision on November 25 to reallocate EUR 48.3 million (EUR 41 million from EU funds and EUR 7.3 million from national co-financing) for the implementation of the second phase of the LOC, i.e. the full conclusion of the construction contract, the Finance Ministry has started drafting the next amendments to the EU funds program, which are planned to be submitted to the EC for approval next year.

ReArm Europe is an EC initiative to give EU Member States more flexibility to invest EU funds in the defense industry within the existing funding (in Latvia's case EUR 4.2 billion of EU funds for the 2021-2027 planning period).