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Private sector and human-resource development in Georgia

Курсовой проект - Экономика

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approval of a revised budget. The current PRGF will expire in the next several months and the IMF will soon be initiating discussions to assess prospects for a possible new three-year program to support Georgias EDPRP.

  • The World Bank has taken the lead in the policy dialogue on structural issues, focusing on: (i) strengthening public expenditure management; (ii) deepening and diversifying sources of growth, (iii) protecting the environment; and (iv) reducing poverty. The table on page 53 summarizes the division of responsibility between the two institutions. In a number of areas for example the social sectors, rural development, environment, and infrastructure the Bank takes the lead in the dialogue and there is no cross conditionality with the IMF-supported program. The Bank is also leading the dialogue on private sector reform, and Bank analysis serves as inputs into the Fund program. In other areas energy, the financial sector, public expenditure management, and revenue and customs both institutions work together. Finally, in areas like monetary policy the IMF takes the lead with little Bank involvement.

    • Areas in which the World Bank leads and there is no direct IMF involvement

    1. Areas in which the Bank leads and there is no direct IMF involvement include the social sectors, infrastructure and environment.
    2. In the social sectors the Bank conducts annual updates of Georgias Poverty Assessment based on household data collected on a quarterly basis. The Banks focus has been to improve the budget execution of expenditures for health, education and poverty benefits and to raise the efficiency in the use of scarce public resources. Through the Social Investment Fund Credits IDA is focusing in particular on areas with high poverty levels to provide basic infrastructure to the poorest communities. A recently approved Self-reliance Fund Grant will help authorities address the complex issues related to internally displaced people. IDA is also supporting a dialogue with the Government on social protection reform that may lead to an IDA-supported project.
    3. In education the Education Adaptable Program Credit aims at improving the learning outcomes of primary and secondary students, through curriculum reform, development of an examination system, training of teachers, provision of learning materials, and development of capacity to make better use of Georgias physical, financial and human resources. While the investment needs of school buildings are substantially higher than is currently affordable for Georgia, the Social Investment Fund projects continue to assist in financing urgent repairs to school facilities in many communities.
    4. In health IDA Credits to support the Government in improving the health care financing system, exploring risk-pooling options, introducing a new system of primary health care and improving the focus of services funded through public funds on the poor and on priority public health interventions. In addition hospital restructuring has been supported by SAC 3 and the Structural Reform Support Credit.
    5. In infrastructure support is being provided through the Municipal Development and Decentralization Credit and the Social Investment Fund Credit. These projects are providing financing at the community level for critical infrastructure needs, primarily for school and health facilities heating and repair, small hydropower schemes to provide electricity, drinking water and sanitation rehabilitation, as well as transportation infrastructure rehabilitation.
    6. In rural development IDA credits have supported the development of private sector farming and agro-processing improvements, agricultural credit, irrigation and drainage, and agriculture research and extension. IDA has also been supporting the creation of local institutions such as rural credit unions and water users associations through its Credits.

    Areas in which the World Bank leads and its analysis serves as input into the IMF program

    1. The Bank has been leading the dialogue on structural reforms through SAC 3, approved by the Banks Board of Executive Directors in June, 1999, and closed in October, 2002. Despite considerable delays, the core conditions of SAC 3 were met, but their impact was reduced by poor governance. Institution building and technical assistance has been supported through the Structural Reform Support Credit, also approved by the Banks Board of Executive Directors on June 29, 1999. The Bank also leads in the areas of:
    2. Private sector development. SAC 3 supported improvements in the environment for private sector development, focusing on: (i) simpler licensing regulations; (ii) more transparent government procurement; (iii) reduced cost of entry for businesses; and (iv) privatization of state-owned commercial assets. IDA has also been supporting private sector participation in other areas such as energy, telecommunications, urban services and agriculture. The IMF has worked with the authorities to initiate audits of the 2002 accounts of three major state owned enterprises.
    3. Energy. The energy system is in poor condition, with unreliable supply, massive non-payment and mounting debts. IDA has been working with other donors, including the IMF, to encourage more private management and ownership, and to implement a series of short-term action plans to improve the overall functioning of the sector. The IMF has also been focusing on improved payments for electricity.
    4. Public Sector Management. The Bank is supporting the development of a civil service reform program, while the Fund is providing technical assistance in support of tax and customs administration reform.

     

    Areas of shared responsibility of the World Bank and IMF

    1. The Bank and the Fund have been working jointly in the following main areas (supported by the Banks SAC 3 and Structural Reform Support Credit, several investment operations and the Funds PRGF):
    2. Poverty Reduction Strategy. Both institutions have been working closely with the Government to provide support to the development of the PRSP, through seminars and workshops, direct staff input, and a multi-donor Trust Fund to support the work of the PRSP secretariat..
    3. Budget Planning and Execution. The annual process-based Public Expenditure Reviews will provide the underpinnings for systemic changes in expenditure management, with the immediate aim being improved budget formulation in 2004. The IMF is focusing on Treasury reform within the Ministry of Finance.
    4. Financial Sector Reforms. The joint Financial Sector Assessment Program has supported: (i) strengthened banking and non-banking supervision; (ii) introduction of international accounting standards; (iii) and consolidation of banks through higher capital requirement ratios; and (iv) anti money-laundering legislation. The IMF has focused in particular on banking supervision.
    5. Debt Sustainability Analysis (DSA). Given Georgias heavy external debt burden, the Bank and the Fund conduct joint Debt Sustainability Analysis on a regular basis.

     

    Areas in which the IMF leads and its analysis serves as input into the World Bank program

     

    • Fiscal Framework. The IMFs focus on prudent fiscal policy has served as an important framework for IDAs work on public expenditure management.

    Areas in which the IMF leads and there is no direct World Bank involvement

    • Monetary Framework. The IMF closely collaborates with the NBG in the design and implementation of a monetary program that aims at remonetization of the economy, while keeping inflation low and the exchange rate of the Lari stable
    • Economic Statistics. IMF technical assistance has been conducive to improvements in national accounts, price, monetary and government financial statistics.
    1. The World Bank Country Assistance Strategy for Georgia

     

    Activities

    (as identified in the EDPRP)Responsible AgenciesFocus of Bank

    ActionsExpected Results FY04-06Bank Group ProgramPart-nersWB Performance

    Indicators for End FY06Improvement of Governance

    • Development of a comprehensive, long-term concept and action plan of executive government reforms, and of a program to improve structure and number of employees in organizations under budgetary financing State Chancellery, Ministry of Justice, Ministry of Finance
    relevant executive government bodies

    Assistance to the State Chancellery in carrying out a functional analysis of the central government agencies and assessment of budgetary employment, remuneration, and training policy; on the basis of the above studies, develop recommendationsWidely owned program to improve functioning of government administration and agencies; remuneration and retrenchment policy for core civil service introduced, and plans for civil service training developed Public Sector Management ProjectDFID, USAID, UNDPInitiation of reform and restructuring of civil service

    • Inventory of normative acts defining the competence of government agencies to avoid duplication of local government functionsState Chancellery of Georgia, Ministry of JusticeReview of the existing legal frameworkInitiation of legislative change and amendments Public Sector Management Project; Public Expenditure ReviewsDFID
    EU USAID UNDP

    Duplications and overlap among the central state agencies reduced, mandates more clearly defined