Private sector and human-resource development in Georgia

Institutional Development Fund

IDP

Internally Displaced Persons

IFC

International Finance Corporation

IMF

International Monetary Fund

IOSCO

The International Organization of Securities Commissions

JSC

Joint Stock Company

KfW

German Financial Cooperation





LLC

Limited Liability Company

MDGs

Millennium Development Goals

MoF

Ministry of Finance

NBG

National Bank of Georgia

NGO

Non-Governmental Organization

NBG

National Bank of Georgia

NGO

Non-Governmental Organization

OECD

Organization For Economic Coop’n & Development

PER

Public Expenditure Review

PPP

Purchasing Power Parity

PRGF

Poverty Reduction and Growth Facility

PRSP

Poverty Reduction Strategy Paper

SAC

Structural Adjustment Credit

SATAC

Structural Adjustment Technical Assistance Credit

SEC

Security and Exchange Commission

SIDA

Swedish International Development Agency

SIF

Social Investment Fund

SME

Small and Medium Enterprises

SRS

Structural Reform Support Project

TACIS

Technical Assistance to the CIS (EU)

UNDP

United Nations Development Program

UNHCR

United Nations High Commissioner for Refugees

USAID

United States Agency for International Development

VAT

Value Added Tax

WTO

World Trade Organization








1.    Government Policies


1.1  Government promotion policies of small and medium size enterprises

 

 


[To be described:] "Small and Medium Enterprise State Support Program for 2002 - 2004 in Georgia"


[To be described:] Law of Georgia "On Promotion of Small and Medium Enterprises"



1.2  National Investment Agency of Georgia


[To be described:] Law of Georgia "On National Investment Agency of Georgia"


[To be described:] Activities of the National Investment Agency of Georgia



 

1.3  Georgian Investment Center


[To be described:] Activities of the Georgian Investment Centre


1.2.1        Government’s Export Promotion Policy

Foreign Trade Regimes. Reforms carried out in recent years in Georgia, including serious legal reforms, are working successfully to create a favourable foreign trade regime in the country. Since 1995 the following major reforms have taken place in Georgian legislation:

  • The system of quotas has been eliminated.
  • Products included in the nation's export embargo policy include only works of art and antiques and items of national historical importance.
  • There is no customs duty for exports in Georgia.
  • A fiscal policy aimed at stimulating exports has been introduced whereby all export goods are free of VAT and excise duty;

Export of goods requiring an export license have been reduced to the following classes:

Collections and collectors' pieces of zoological, botanical, mineral, anatomical, historical, archaeological, paleonthological, ethnographic or numismatic interest (HS - 9705);

Wood and timber (4401, 4403, 4404, 4406, 4407);

Seeds of Caucasus Pine (120999100);

Ferrous and non-ferrous metal scrap (7204, 7404, 7602).

The system of compulsory registration of foreign trade contracts was eliminated in November 1997.


The establishment of favourable trade regimes with partner countries through bilateral and multilateral agreements has commenced. During the period 1992 - 1998, Georgia signed trade agreements with 22 countries. Agreements on free trade have been signed with eight CIS countries and Georgia already has working free trade agreements with Russia, Ukraine, Azerbaijan, Armenia, Kazakhstan and Turkmenistan. Currently a multilateral agreement on CIS free trade zone is being enforced. According to these agreements signatories to the agreement need not use customs duties and taxes for exports or imports of the goods originated in the territory of one party and destined to the territory of the other party.


Furthermore, Georgia has become a part of several international conventions.


On October 6, 1999 Georgia became a member of the World Trade Organization (WTO) which granted Georgia the status of the Most Favoured Nation with 135 WTO member countries. Through the mechanisms of this organisation, Georgia will be protected from discrimination, unfair competition, falsification and unjustified limitations.


In 1996 Georgia signed an agreement on partnership and cooperation with the European Union which deals with economic relations in almost every sector. In fact the agreement covers all sectors of the economy.


In 1999 Georgia became a member of the Council of Europe with full rights, which will further facilitate trade-economic relations between Georgia and member countries of the European Union.


Many countries have granted to Georgia reductions in import customs taxes to their countries, under the General System of Preferences. These include the countries of the European Union, Switzerland, the Czech Republic, Slovakia, Canada and Japan. This is one of the most important influences on the successful growth of exports for Georgia. The effective use of facilities such as GSP will substantially promote Georgian export development.

Law of Georgia "On Technical Barriers to Trade". The law "On Technical Barriers to Trade" lays down the basis for eliminating the technical barriers to trade during the process of the preparation, adoption and application of the technical regulations, standards and the procedures for the assessment of conformity.


The national technical regulations and standards should not create unnecessary obstacles to trade, which will put national products in favourable conditions. Therefore, the development of the national technical regulations and standards should be carried out on the basis of a direct use of the international standards.


Georgian legislation did not envisage the concept of technical regulations. The concept of technical regulations was defined by Law of Georgia "On Standardization" adopted in 1999. The technical regulations is a legal act, which defines the technical specifications for products or service, which is done directly or by means of referring to Georgian standards and requiring that complying with these standards is compulsory.


The principles of the state standards that are effective in Georgia envisage the application of the national standards on a compulsory basis from the moments of its effectiveness. However, based on the principles that define the standards as voluntary, the international practice envisages two-stage approach to making a standard as mandatory requirement: the standard that was adopted by national body is optional and it may be used by any party, however it will become mandatory, if it is defined by:

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