Economic Program

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Economic Program 23 Economic Program In 2016, the Economic Program focused its work on the following areas: • Energy market liberalization and energy security. CSD continued to analyze the energy security challenges for SEE: excessive dependence on energy imports, reliance on a limited number of energy suppliers, high energy poverty levels, unsustainable energy intensity and demand; and persistent energy governance risks. CSD engaged in an initiative for the development of a Long Term Electricity Roadmap for the SEE, and performed a poverty and social impact assessment of the National Program for Energy Efficiency of Multifamily Buildings. Drawing on its expertise in energy security and good governance, CSD, in cooperation with the Center for Strategic and International Studies (CSIS), published a study The Kremlin Playbook: Understanding Russian Influence in Central and Eastern Europe. It became the most downloaded publication of the year for CSD and CSIS. • Good governance, anticorruption, and state capture. CSD piloted a feasibility study on designing metrics for the state capture phenomenon. CSD continued its work on fraud and corruption risks in the area of public procurement, the nexus between European financing and anti-corruption, and the policy options for countering money laundering. The Southeast Europe Leadership for Development and Integrity (SELDI) initiative, coordinated by CSD, was able to further its impact in the SEE region. In its flagship reportShadow Power: Assessment of Corruption and Hidden Economy in Southeast Europe, SELDI underlines that in none of the countries in the region has there been a clear sustained policy breakthrough in anticorruption, though efforts to deliver technical solutions and to improve the functioning of the law enforcement institutions have persisted. CSD continued to deepen its theoretical and empirical capacity in anti-corruption and good governance through its participation in ANTICORRP.eu and the EU Anticorruption Report network. • Hidden economy. CSD and Vitosha Research continued their good co- operation with the University of Sheffield Management School and the Institute of Public Finance in the study and exchange of best practices in tackling undeclared work in Europe. In the framework of the SELDI initiative, CSD experts and their partners from eight SEE countries prepared a backgrounder report, a policy brief and national Hidden Economy Fact Sheets presenting key findings on the manifestations, causes and impacts of the hidden economy and undeclared labour in the SEE countries in 2016. • Competitiveness and knowledge economy. CSD continued analyzing the barriers to the Bulgarian business, provided recommendations for improvement of the overall economic competitiveness and contributed to the 24 development of the 2016 IMD World Competitiveness Yearbook. CSD experts participated in the development of the annual Innovation BG report, drawing key recommendations for improving the national innovation policy in Bulgaria. I. Energy governance and energy region’s energy challenges, and puts at security stake Europe’s opportunity to diversify its energy supply. In that sense, there is In 2016, the Economic Program contin- a need for developing a common under- ued to analyze the deficits in the energy standing for the constraints stemming sector governance and the EU-Turkey from the current segmented approach to Energy Dialogue. The topic is of par- energy security and governance issues ticular importance, since at the moment in the region and the identification of Turkey is at a pivotal point in its eco- the multilateral mechanisms that can be nomic development, whereby it is trans- utilized to strengthen the overall energy forming itself into a modern industrial security architecture. The latter requires economy. As with other industrializing the deeper engagement of civil society economies, Turkey is experiencing ris- organizations, which play a crucial role ing natural gas consumption wedded in advocating strategic energy policies to supply challenges. However, Turkey, improving the security of supply and with the development of proactive poli- the governance of the sector. cies, is able to change the current para- digm of industrial inefficiency (such as In partnership with the Economic Policy rising energy intensity rates) and pro- Research Foundation of Turkey (TEPAV) mote economic competitiveness. Turkey and the Mediterranean Energy Observ- has also become a crucial factor for the atory (OME) the CSD prepared a policy completion of the EU-backed Southern brief on Ensuring Effective Cooperation Gas Corridor, which for Europe is a pri- between EU and Turkey to Foster Energy ority project to diversify energy imports Security. The analysis contains a list of and make Europe less dependent on practically-oriented policy recommen- Russia. In the context of the EU Energy dations to accelerate the process of re- Union initiative, Turkey is placed strate- gional market integration, the transfer gically to assist in its goals of bringing of the EU energy acquis in the Turkish about energy market integration and energy sector framework and the com- meaningful diversification of sources in pletion of critical cross-European energy the Black Sea region. diversification projects. The policy ad- vocacy effect of the proposals have been Strengthening the EU-Turkey Energy strengthened by the active participation Dialogue on Energy Security of the Turkish Oil and Gas Association and Governance (PETFORM) and the participation of key energy Turkish and EU policy-makers in Despite EU’s activism, Turkey and the two workshops in Ankara and Istanbul. countries in the region still pursue most- ly a bilateral approach to energy securi- The policy brief underlines that the suc- ty, which is insufficient for the develop- cessful creation of a European energy ment of a strategic regional energy sys- union will not be possible without the tem. The latter erodes efforts for a mul- active involvement of Turkey. The latter tilateral (pan-regional) approach to the is going to play a vital role as a natural 25 Workshop: Ensuring Effective Cooperation between EU and Turkey in Fostering Security of Energy Supply, Ankara. From left to right: Mr. Volkan Özdemir, Chairman of EPPEN Energy, Dr. Todor Galev, Senior Analyst, CSD, Ms Bengisu Özenç, TEPAV’s Macroeconomic Studies Program Director, Mr. Eser Özdil, Turkish Oil Platform (PETFORM) Secretary General, and Mr. Martin Vladimirov, Analyst at the Economic Program of CSD gas trading hub for future alternative seasonal peak demand period. Most of natural gas supply from the Caspian re- oil and gas and half of coal supply came gion, East Mediterranean and the Middle from imports leading to serious macr- East. Similarly, Turkey will benefit from oeconomic imbalances and producing a the development of the Energy Union negative impact on business and invest- because it can transform itself in a major ment confidence. energy-trading hub based on alternative gas supplies that will satisfy domestic The workshop Ensuring Effective Coop- demand, while the excess supply could eration between EU and Turkey in Fostering be re-exported to Europe. Still, Turkey’s Security of Energy Supply, organized by energy sector transformation towards the Economic Policy Research Founda- becoming part of the planned European tion of Turkey (TEPAV), the Center for internal energy market is happening the Study of Democracy (CSD), the Turk- only very slowly. Given that the inevita- ish Oil and Gas Association (PETFORM) ble changes will have an effect on both and the Mediterranean Energy Observ- industries and individual consumers, atory (OME) on 8 September 2016 in An- politicians have been reluctant to sign kara, Turkey, deepened the discussion on the dotted line and initiate the final on these issues. Senior Turkish and EU stages of liberalization. The analysis energy policy-makers took part in the also notes that Turkey is one of the most event and spoke on the Turkish energy vulnerable countries from possible en- security risks and challenges before the ergy supply cuts, especially during the successful integration of Turkish energy 26 sector in the Energy Union framework. was one of the conclusions of the work- The participants noted the crucial im- shop on Energy Market Liberalization and portance of the Turkish geopolitical po- Regional Market Integration, organized sition for the future of the Energy Union. in Istanbul on 10 October 2016 on the They emphasized that the countries in sidelines of the World Energy Congress the Black Sea region need to overcome (WEC). their focus on bilateral energy coopera- tion, which is insufficient for developing The CSD experts pointed out that the a strategic pan-European partnership cooperation between private and public agenda. More than ever, market inte- actors would be crucial to the market gration would require stronger policy liberalization, the reduction of energy cooperation that goes beyond inter-gov- security risks and the improvement of ernmental talks to include businesses regional energy cooperation. However, and civil society organizations (CSOs) energy cooperation in the SEE region in the energy dialogue. The Director of and Turkey is mostly in the electricity TEPAV’s Macroeconomic Studies Pro- sector, while in natural gas there is com- gram, the President of a Network Oper- petition between countries. The partici- ation Group at the regulator, EPDK and pants noted that the EU has the objective the Business Development Manager at of creating
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