Private sector and human-resource development in Georgia

Ministry of Finance, State Service of Insurance Supervision, National Commission of Securities

Support to relevant agencies on amendments to tax code and investment rules

Improved functioning of non-banking financial sector, including insurance companies/private pension funds

Social Protection Reform Project


Greater and more effective role for non-banking financial sector, including insurance companies and private pension funds



Structural Reforms







                            Assess magnitude and share smuggled goods and those manufactured in informal sector of the economy by various commodity groups

Ministry of Economy, Industry and Trade; State Department of Statistics

Support for initiatives to reduce smuggling and the shadow economy

Reduction in smuggling and in the shadow economy

Trade Facilitation Project; Private Sector Development Project; Public Sector Reform Project; PRSC in High Case

USAID

Increase in tax revenues, including increase in revenues from petroleum products and cigarettes to over 2.5% of GDP

                            Develop proposals to encourage investment

Ministry of Economy, Industry and Trade; Ministry of Finance; Ministry of Justice

Intensified dialogue with Government on reform of the banking system as a means of improving the investment climate

Increase in banks capitalization; better corporate governance principles and internal control systems; expansion of banking networks; real time banking settlement; anti-money-laundering legislation; deposit insurance introduced

Private Sector Development Project; Financial Sector Advisory Program; Business Environment Study

USAID

IMF

FIRST

Minimum capital raised to 3.5m; improved confidence in banking system; better access to finance; anti money laundering regulations in compliance with FATF requirements

                            Implement export promotion measures

Ministry of Economy, Industry and Trade; Ministry of Finance

Support for removal of institutional (governance) obstacles to fulfilling Georgias Export Potential

Progress in implementing recommendations of Trade Study/Workshop

Trade and Transport Facilitation Project; Private Sector Development Project; Business Environment Study; Rural Development Project

USAID

Improved perception of environment for exporters in business surveys

Human Capital Development







Improvement of Health







                            Revise government commitments in healthcare sector to ensure full financing

Ministry of Labor, Healthcare and Social Protection; Ministry of finance

Assist government to define health financing strategy focusing on improvements in mobilization, allocation and management of public and private resources, help build government capacity in evidence based policy-making, planning, monitoring and evaluation, as well as regulation


Definition of basic benefit package, financing methodology and co-payments, as well as recurrent costs; improved resource mobilization and allocation, including introduction of incentive-compatible provider payment systems

Health Sector Note, JSDF Grant on community health insurance

JSDF SIDA

DFID WHO

Definition of basic benefit package, financing methodology, co-payments, and recurrent costs; better resource mobilization and allocation, including introduction of incentive-compatible provider payment systems

Improvement of Education







                            Develop programs for basic education

Ministry of Education, Ministry of Culture

Improving quality of education and access of the poor

Stakeholders actively engaged in improving education quality and outcomes

Education Project

SOROS

97 percent enrollment in basic education for the poorest quintile; 60% of consolidated education expenditures continue to be allocated to primary/secondary education


Improvement of Social Risks Management







                            Definition of nature and periodicity of government commitments in the social sector to ensure full financing

Ministry of Labor, Healthcare and Social Protection; State Social Security Fund; Ministry of Finance

Timely execution of Government obligations in the social sectors; fiscal affordability and sustainability

No-arrears in social transfers, increased poverty alleviation impact

Public Expenditure Reviews, PRSC in High Case


No new arrears; poverty incidence decreased by 6 percentage points

                            Enforce package of draft bills on compulsory social insurance

Ministry of Labor, Healthcare and Social Protection, State Social Security Fund

Support to implementation of social insurance system

Better performance of the pension system

Social Protection Reform Project


No pension arrears; financing of social insurance/assistance benefits separated

                            Phased increase of pensions

Ministry of Labor, Healthcare and Social Protection, State Social Security Fund

Dialogue on pension policies

Increase in pensions

Public Expenditure Reviews; Social Protection Reform Project


Average real pension increased by 20%; extreme poverty among elderly reduced

                            Fiscal sustainability of pension system based on compulsory social insurance

Ministry of Labor, Healthcare and Social Protection, State Social Security Fund

Dialogue on pension policies

Satisfactory performance of the pension system

Public Expenditure Reviews; Social Protection Reform Project

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