STRUCTURAL ADJUSTMENT TECHNICAL ASSISTANCE CREDIT (SATAC)

Project Objective    To support the Government’s reform program to stabilize the economy and create the conditions for a resumption of growth and an improvement in living standards.

 

Project Description 1. Privatization and post-privatization (US$ 0.95 million)

                                  (i) Continued support for the implementations of the privatization program and on support for the establishment of the share registries.

                                  (ii) Introduction of cash auctions and an international tender program;

                                  (iii) Strengthening of institutional capacities, elaboration of standard procedures, advise on structuring of transactions and bid evaluation, as well as legal assistance and licensing of private share registries.

                                  (iv) Elaboration of operational guidelines, training of officials in securities market and in the starting-up of pilot registries.

 

                                  2. Financial Sector ( US$ 0.78 million )

                                  (i) Advisory services on supervisory issues as well as the development of training programs.

                                  (ii) Audits if the three former state banks will be financed to dacilitate a realistic assessment of the financial position of each bank.

                                      

                                  3. Energy sector reform ( US$ 0.86 million )

                                  (i) Assistance in creating the capacity to monitor and manage payment performance, and in reviewing structural and tariff issues.

                                  (ii) Assistance in reviewing the scope of the regulatory authority and its tariff policy functions.

 

                                  4. Social Protection ( US$ 0.56 million)

                                  (i) Assistance in the design of a program of social assistance which meets the needs of poor families that do not qualify under any existing program;

                                  (ii) Facilitating the establishment of private pension schemes.

 

                                  5. Resource mobilization and public information

( US$ 1.43 million)

                                  (i) A program aimed at improving the revenue collection performance of the Customs Department through training, revision of procedures and controls, and anti-fraud measures;

                                  (ii) A public information/education program on economic reforms, including mass media campaigns, round-tables/seminars on key issues, and the design of an education program focusing on skills in high demand in market economics

 

Implementing Agency     Zaal Japaridze, Head of PIU, 12 Kazbegi Ave.

                                          Phone: (99532) 950865

                                          Ministry of Trade and Foreign Economic Relations

                                          42, Kazbegi Ave.      

Phone: (99532) 225186 / (99532) 389652

TRANSPORT REHABILITATION

 

Project Objective    1. To support policy reform in the transport sectoral and restructure its institutions to operate in a market economy.

                                  2. To repair and maintain some of the most critical elements of the transport system.

 

Project Description (1) Institution Building Component (US$ 4.9 million):

                                  (i) advice and support to teams preparing sector reforms;

                                  (ii) technical assistance for the formulation of technical and legal framework necessary to the restructuring,

                                  commercialization and privatization of sector entities;

                                  (iii) managerial assistance for public and private transport enterprises;

                                  (iv) a training program to update transport technical staff of the private and public sectors;

                                  (v) project management.

 

                                  (2) Investment Component ( US$ 13.2million )

                                  (i) road maintenance program, including selected equipment and spares for road maintenance as well as emergency repairs and the necessary imported road building materials;

                                  (ii) a railway sub-component, including bridge repairs and the required structural steel, track materials (ties, rails and fastenings), spares for locomotives, and communications and selected signaling equipment

 

 

Implementing Agency     Gia Tsagareli, Head of PIU, 12 Kazbegi Ave.

                                          Phone: (99532) 986385

                                          Fax: (99532) 990461

 

STRUCTURAL ADJUSTMENT CREDIT (SAC)

Project Objective: The main objective is to consolidate stabilization, foster a strong and sustained growth recovery and reduce poverty.

                              The reform program aims at:

(a) maintaining a tight monetary program supported by an improving fiscal position;

(b) streamlining the Government sector and improving efficiency of public spending;

(c) inducing a rapid adjustment of the productive sector to new          market signals.

The other objectives are;

(i) provide budgetary support to maintain the level of critical public expenditures;

(ii) provide foreign exchange for the purchase of critical imports;

(iii) provide a framework for financial assistance from other donor agencies.

Project

Description:          1. Maintaining a Tight Monetary Policy:

§ reduce inflation to 20-25 percent in 1996 and strengthen the international position of NBG;

§ increase the range of monetary instruments and enhance the capacity of the NBG to achieve monetary objectives.

2. Improving the Fiscal System:

§ ensure sustainability of stabilization;

§ increase tax revenue to 6.7 percent of GDP in 1996;

§ reach a revenue to expenditure ration of 70 percent in 1996 and maintain budget deficit at 3-4 percent of GDP in 1996.

3. Streamlining of the Government Sector and Improving the Efficiency of Public Spending:

§ to maintain critical public function within the framework of a tight expenditure program (expenditure maintained at about 13 percent of GDP in 1996);

§ reforming government pay and employment;

§ reforming the provision and financing of social services reforming social insurance and social protection;

§ eliminating energy subsidies;

4. Fostering Adjustment of the Productive Sector:

§ accelerating privatization;

§ restructuring the financial sector;

§ fostering export growth.

 

Disbursement:      US$ 29.88 million

The disbursement of the loan is linked to agreed targets specified for each tranche release – to be met by the Georgian Government in implementing its structural reform program.