Ireland’s efforts to combat climate change and invest in sustainable actions are lagging behind its European Union counterparts. A recent report by the European Investment Bank (EIB) highlights that Irish firms are slow to implement eco-friendly activities and have a low inclination to invest in green initiatives over the next three years. This is in contrast to other western and northern EU countries, which are leading the way in investing in climate-related projects.
The report sheds light on the challenges Ireland faces in meeting its climate targets. The economic crisis caused by the COVID-19 pandemic has led to companies backing away from green investments, and rising uncertainty may lead to organizations losing enthusiasm for tackling climate change. Furthermore, the report suggests that Ireland’s slow progress in implementing eco-friendly activities may have a significant impact on the country’s ability to meet future climate goals.
This article will explore the reasons behind Ireland’s lagging efforts, the investment challenges faced by Irish businesses, and the EIB’s proposals for increasing investment in sustainable actions.
Irish Eco-Friendly Activities
Irish firms have been found to be slower in implementing eco-friendly activities compared to other EU countries. According to a report, many countries, including Cyprus, Greece, Ireland, and Luxembourg, are not doing enough to combat climate change. In contrast, western and northern EU countries are leading in investing in climate-related initiatives. The report also highlighted the economic crisis as a factor causing companies to back away from green investments.
The low inclination to invest in green activities over the next three years further highlights the need for Ireland to do more for the environment. Increasing costs of energy, rise in interest rates, withdrawal of Covid related aids, and the US green subsidy scheme may hinder companies from investing in climate change initiatives.
However, the European Investment Bank (EIB) proposes an investment push relying on guarantees and blending finance instead of subsidies, which could aid in the implementation of eco-friendly activities. The EIB funded a €21m solar energy project in Ireland and provided €300m to €1.6bn Celtic Interconnector electricity link between France and Ireland, showing their commitment towards a sustainable future for Ireland.
Investment Challenges
Several factors, such as the economic crisis and rising costs of energy, may pose significant challenges for companies looking to invest in green initiatives. The withdrawal of Covid-related aids and a potential increase in interest rates may also hinder businesses’ ability to invest in climate change initiatives. Moreover, the US green subsidy scheme may entice companies to relocate there, further exacerbating the investment challenges in Ireland.
However, the European Investment Bank (EIB) has proposed an investment push relying on guarantees and blending finance instead of subsidies. The EIB study highlights that the economic crisis has caused companies to back away from green investments. Therefore, combining EU funds, incentives, and beneficial loans into accessible financing solutions that can aid the entire EU, not only those with enough resources to subsidize it, may be a viable solution.
While richer countries have the means and will to implement green options by instituting effective and efficient policies, the EIB-funded €21m solar energy project in Ireland and provided €300m to €1.6bn Celtic Interconnector electricity link between France and Ireland show that Ireland has been a beneficiary of the EIB’s generous investments towards the Irish economy for the past fifty years.
EIB Investment Proposals
The European Investment Bank (EIB) has proposed an investment push that relies on guarantees and blending finance instead of subsidies to encourage companies to invest in green initiatives. The EIB study highlights the economic crisis as a major factor causing companies to back away from green investments.
The increasing costs of energy, rise in interest rates, withdrawal of Covid related aids, and the US green subsidy scheme may hinder companies from investing in climate change initiatives.
To address these challenges, the EIB suggests combining EU funds, incentives, and beneficial loans into accessible financing solutions that can aid the entire EU, not only those with enough resources to subsidize it.
The EIB has been generous in its investments towards the Irish economy for the past fifty years, funding a €21m solar energy project in Ireland and providing €300m to €1.6bn Celtic Interconnector electricity link between France and Ireland. The EIB’s proposal for an investment push relying on guarantees and blending finance instead of subsidies may provide a viable solution to encourage companies to invest in green initiatives and combat climate change.
Impact on Local Businesses
Local businesses in the region are feeling the severe impact of the housing shortage, which is hindering their growth and development. The lack of affordable housing options is making it difficult for companies to attract and retain employees, particularly those who are looking for long-term stability. This is especially true for businesses in the tech and finance sectors, which require highly skilled workers who are in high demand.
The housing shortage is also driving up the cost of living, which is putting a strain on the finances of both businesses and their employees. This is particularly problematic for small businesses, which may not have the financial resources to compete with larger companies for talent.
In addition, the lack of affordable housing options is making it difficult for businesses to expand and grow, as they may not be able to find suitable locations for new offices or production facilities. Overall, the housing shortage is having a significant impact on the local business community, and urgent action is needed to address this issue.
Combining EU Funds
Combining EU funds, incentives, and beneficial loans into accessible financing solutions can aid the entire European Union in implementing effective and efficient policies towards sustainable actions. The European Investment Bank (EIB) proposes an investment push relying on guarantees and blending finance instead of subsidies. This approach can help countries, including Ireland, combat climate change and invest in green initiatives.
The EIB study highlights that companies are backing away from green investments due to the economic crisis, increasing costs of energy, rise in interest rates, withdrawal of Covid-related aids, and the US green subsidy scheme.
Investing in sustainable actions is essential for every country, regardless of their wealth. However, GDP per capita remains a key determinant in a country’s ability to invest in sustainable actions. Wealthier countries are better able to invest in green initiatives and are more confident about their competitive advantages.
Therefore, combining EU funds, incentives, and beneficial loans into accessible financing solutions can help poorer countries to invest in sustainable actions. Hoyer, the President of the EIB, states, ‘We do not lack financial resources; we simply need political will and a plan that will provide investors with certainty and attract private capital.’
The EIB has been generous in investing in the Irish economy for the past fifty years, funding projects such as the €21m solar energy project in Ireland and providing €300m to €1.6bn Celtic Interconnector electricity link between France and Ireland.
