Updated April 26 2021 The Three Seas Initiative The Three Seas Initiative 3SI is a regional effort in Europe to expand cross-border energy transportation and digital infrastructure and boost economic development in the area between the Adriatic Sea Baltic Sea and Black Sea Twelve countries Austria Bulgaria Croatia the Czech Republic Estonia Hungary Latvia Lithuania Poland Romania Slovakia and Slovenia all of which are members of the European Union EU participate in the 3SI see Figure 1 The U S government including some Members of Congress have indicated strong backing for the 3SI In November 2020 the House of Representatives passed a bipartisan resolution “expressing support of the Three Seas Initiative in its efforts to increase energy independence and infrastructure connectivity thereby strengthening the United States and European national security” H Res 672 116th Congress Officials from the Biden Administration and the Trump Administration have expressed diplomatic support for the 3SI and high-level U S officials including thenPresident Trump in 2017 have joined its annual summits According to EU data the 3SI region remains less well-off economically compared with the rest of the EU the 3SI countries together comprise just under 30% of EU territory and 22% of its population but account for 10% of the EU’s gross domestic product the EU data predate Brexit and so include the United Kingdom Infrastructure gaps are considered a factor behind regional economic disparities According to EU data road and rail travel in the 3SI region take on average roughly two to four times longer than comparable travel in the rest of the EU Figure 1 Three Seas Initiative Initiative Overview The Three Seas Initiative was launched in 2015 by the presidents of Croatia and Poland and the first annual summit was held in 2016 The 3SI is structured as a flexible platform for generating funding and promoting deeper cooperation among its participating countries an overarching goal is to develop a north-south infrastructure corridor in the region In part as a legacy of the Soviet Union’s Cold War-era dominance over most of the region east-west infrastructure remains considerably more developed than north-south linkages Particularly with regard to energy security the dominance of east-west pipelines and limited alternatives to them have been factors in continuing energy dependence on Russia The United States and the 3SI countries frequently have expressed concern over Russia’s energy supply dominance in the region Such concerns have increased with the construction of Nord Stream 2 and TurkStream pipeline projects that would expand Russia’s capacity to deliver natural gas to Europe Many observers consider the expansion of energy infrastructure including liquefied natural gas LNG terminals necessary for opening up new routes for alternative suppliers Supporters also view the 3SI as a potential counterbalance to China’s interest in participating in regional infrastructure projects as part of its global Belt and Road Initiative Source Map created by CRS High-level officials from the United States the EU and other EU member states such as Germany have joined annual 3SI summits to express their support as interested partners The next summit is expected to be held in 2021 in Sofia Bulgaria Priority Projects and Financing Mechanisms At the 2018 summit the 3SI countries developed a list of 48 priority interconnection projects spanning the energy transportation and digital sectors see Table 1 Another objective of the 3SI is to stimulate economic development and reduce regional disparities within the EU https crsreports congress gov The Three Seas Initiative Table 1 Three Seas Initiative Priority Project Examples by Sector proposed and in-progress projects Energy  An LNG terminal in Krk Croatia completed in late 2020 with a connecting pipeline through Hungary and Slovakia  The Gas Interconnection Poland-Lithuania GIPL a pipeline that would connect Lithuania Latvia and Estonia to the wider European gas network  The Bulgaria-Romania-Hungary-Austria BRUA pipeline which would supply Romanian Black Sea gas to the region Transportation  The completion of Trans-European Transport Network TEN-T north-south road and railway corridors that would connect the Baltic Poland with the Adriatic Slovenia and Italy and with Greece via the Western Balkans  Viking Train a railway to connect the Baltic Sea to the Black Sea via Lithuania Belarus and Ukraine  FAIRway Danube a project to improve infrastructure and navigation con ditions for water traffic on the Danube River in Romania Bulgaria Croatia Hungary and Slovakia Digital  The Three Seas Digital Highway a series of projects to improve data transfer and enhance communications infrastructure including 5G technology and fiber optics  3SI Marketplace seeking to boost trade and investment in the region by connecting small- and medium-sized enterprises SMEs to investment capital  The SmartCity Forum seeking to accelerate innovation and foster investment in innovation in regional cities Source Three Seas Initiative Summit Bucharest September 17-18 2018 Three Seas Initiative Priority Interconnection Projects The Three Seas Initiative Investment Fund a mechanism intended to draw in private-sector financial support was launched in 2019 with an initial commitment of €500 million about $602 million from development banks in Poland and Romania As of April 2021 9 of the 12 3SI countries have pledged contributions totaling about €1 billion $1 2 billion The fund’s current target is to raise €3 billion to €5 billion $3 6 billion to $6 billion The EU is a source of significant financial support for member state connectivity projects and other regional development initiatives According to EU data more than €150 billion about $180 billion in regional development and cohesion funds was allocated to the 3SI countries under the EU’s 2014-2020 budget framework over one-third of this amount was for investments in transport energy and digital connectivity projects Many of the 3SI priority projects have been approved for partial financial support from various EU funds or for loans from the European Investment Bank The Connecting Europe Facility CEF a €30 billion about $36 billion EU funding instrument shares the 3SI’s emphasis on strategic investments in largescale transport energy and digital infrastructure networks According to EU data as of 2018 over 90% of CEF funding for natural gas projects went to the 3SI countries Issues for Congress The objectives of the 3SI appear to align with a number of broad U S security and economic goals that have received congressional interest and support In recent years some Members of Congress have demonstrated a growing interest in European energy security and sought to encourage reduced energy reliance on Russia including by promoting U S LNG exports The Further Consolidated Appropriations Act 2020 P L 116-94 includes the European Energy Security and Diversification Act of 2019 Division P Title XX and the Eastern Mediterranean Security and Energy Partnership Act of 2019 Division J Title II Members of Congress also may be interested in U S financial support for the 3SI The Trump Administration pledged up to $1 billion in support through the U S International Development Finance Corporation DFC In December 2020 DFC approved a $300 million investment in the fund to be used “primarily for projects focused on energy security ” This investment approval was facilitated by the European Energy Security and Diversification Act of 2019 which eases country-income-level restrictions for certain energy infrastructure projects in Europe In February 2021 a bipartisan group of Members urged the Biden Administration to continue the previous Administration’s pledged financial support for the 3SI and called on DFC to finalize its approved $300 million investment citing concern over infrastructure deficiencies that make the 3SI region “overly dependent on Russia and China for energy and economic needs ” For additional information about the DFC see CRS In Focus IF11436 U S International Development Finance Corporation DFC by Shayerah Ilias Akhtar and Nick M Brown Some Members of Congress have demonstrated strong support for a range of efforts to deter potential Russian aggression and perceived malign influence in Europe Some Members of Congress also have expressed increasing concern over strategic competition with China in Europe and may have an interest in potential avenues to counterbalance the influence of China’s financial investments and diplomatic engagement in the region In the context of these broad strategic concerns Members of Congress may be interested in U S involvement with the 3SI as a complement to the United States’ already extensive diplomatic security and economic cooperation with the countries of Central and Eastern Europe Sarah E Garding Analyst in European Affairs Derek E Mix Specialist in European Affairs https crsreports congress gov IF11547 The Three Seas Initiative Disclaimer This document was prepared by the Congressional Research Service CRS CRS serves as nonpartisan shared staff to congressional committees and Members of Congress It operates solely at the behest of and under the direction of Congress Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has been provided by CRS to Members of Congress in connection with CRS’s institutional role CRS Reports as a work of the United States Government are not subject to copyright protection in the United States Any CRS Report may be reproduced and distributed in its entirety without permission from CRS However as a CRS Report may include copyrighted images or material from a third party you may need to obtain the permissio n of the copyright holder if you wish to copy or otherwise use copyrighted material https crsreports congress gov IF11547 · VERSION 2 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