LATVIA'S DEVELOPMENT COOPERATION WITH GEORGIA COUNTRY STRATEGY PAPER (copy)

12.01.2015. 13:37

Latvia's development cooperation with Georgia

2006 - 2008
country strategy paper

(Word Document format)

On behalf of the Ministry of Foreign Affairs and the UN Development Programme in Latvia, we would like to thank all persons in Latvia and Georgia who have devoted their time contributing to this paper, by providing consultations and sharing their experience and expertise.

TABLE OF CONTENTS

Introduction

1. Framework and basic principles of Latvia's development cooperation

2. Georgia: situation analysis (overview)

   2.1. Political situation

   2.2. Economic situation: achievements, challenges and prospects

   2.3. Social situation: achievements, challenges and prospects

3. Development cooperation challenges and Georgia's priorities

   3.1. International donors contributing to Georgia and their action priorities

4. Overview of earlier and current Latvia–Georgia cooperation

5. Latvia's strategy for development cooperation with Georgia

6. Project implementation mechanisms

ABBREVIATIONS

UN –United Nations

UNDP – United Nations Development Programme

Strategy - Latvia's strategy for development cooperation with Georgia

Basic Principles – The Basic Principles for the Development Cooperation Policy of the Republic of Latvia

EDPRSP- Economic Development and Poverty Reduction Program

OSCE – Organization for Security and Cooperation in Europe

EU - European Union

GEL - Georgia's national currency - the lari

GDP - Gross domestic product

IPAP- Individual partnership action plan NATO

LPDC- Latvia's Platform for Development Cooperation

NATO- North Atlantic Treaty Organization; Transatlantic organization (structures)

CIS – Commonwealth of Independent States

GNP – Gross national product

ODA – Official development assistance

Anti-Corruption Network - Anti-Corruption Network for Transition Economies

Introduction

Latvia's Strategy For Development Cooperation with Georgia is an analytic document defining the Latvia-Georgia development cooperation directions for 2006 - 2008. Based on this Strategy, the relevant Latvian state institutions may then draw up definite development cooperation plans and implement the ideas proposed for planning and implementation of the necessary projects. The Strategy is not to be regarded as a policy planning document providing for Latvia's action policy, and as such is not of a binding but of a recommendatory nature.

The Strategy incorporates Latvia's key principles and goals related to development cooperation action policy, as well as outlines the general plans for the time period from 2006 to 2008. It identifies Georgia's development achievements and the main trends, challenges and objectives concerning the development of the country during the said time period. The Strategy also focuses on the Latvia-Georgia cooperation to date and identifies specific sectors and sub-sectors for further cooperation taking into consideration Latvia's comparative advantages.

Latvia's strategy for development cooperation with Georgia has been drawn up in accordance with Georgia's development priorities, Latvia's development experience and expertise assessment, the activities of other international donors in Georgia to date, and their plans for these three years. This document is based on Latvia's development cooperation action policy documents, Georgia's development documents, strategies and the targets set by these strategies, the activities of other international donors undertaken to date and their plans for further action and assistance directions in Georgia. Together with the analysis of the documents, several consultations have also been held with the involved parties of both states, during which the cooperation to date has been assessed and further cooperation areas identified for various sectors. The consultations were conducted with representatives of state and municipal institutions, Latvian and Georgian non-governmental organizations and representatives of the international donors contributing to Georgia.

The Strategy is mainly intended for use by Latvia's Ministry of Foreign Affairs as the public administration institution responsible for the preparation and implementation of development cooperation policy. The Strategy may also prove useful to other Latvian state institutions already involved in the process of extending development assistance or planning to commence such activities. The information compiled will also be of value to representatives of the relevant Georgian institutions to learn of Latvia's development cooperation priorities and participate in coordinating development cooperation with the other international donors. This information is essential to the international donors contributing actively to Georgia to learn of Latvia's intentions related to development cooperation in Georgia, as well as Latvia's comparative advantages and expertise that in future may be attracted to large-scale projects initiated by international organizations. The existing cooperation between the Georgian and Latvian third sector or public organizations allows the representatives of such organizations to exchange opinions on ways of cooperation, and actively co-participate in elaborating and implementing the Strategy.

The information provided by the Strategy reflects Georgia's long-term development priorities as determined during the second part of 2005. Although the priorities provide the basis for planning development cooperation projects, at the same time they are also being reassessed by Georgian state institutions. It would therefore be worthwhile supplementing and updating the Strategy on completion of the reassessment process. If annual development cooperation plans are based on this Strategy, it should be noted that the situation in both countries may change and that therefore, these plans would have to be coordinated with the Georgian side prior to their final approval. The Strategy shall be updated on a regular basis – every six months or in accordance with the ongoing changes related to the development cooperation undertaken by both countries. The Development Cooperation Policy Department of the Latvian Ministry of Foreign Affairs is responsible for updating and coordination of the Strategy. When updating the Strategy and drawing up further development cooperation plans, it is important to undertake consultations with the involved parties and jointly discuss the proposals related to development cooperation in general, as well as specific projects.

1. Framework and basic principles of Latvia's development cooperation

This part of the document considers the basic principles of Latvia's development cooperation and its comparative advantages, which together provide the basis for defining Latvia's strategy for development cooperation with Georgia.

Latvia has been actively contributing to the implementation of bilateral and multi-lateral assistance, which has proved to be both successful and useful. Since 1992 Latvia has participated in various special funds and programmes through its co-financing from the state budget, as well as provided human resources and financial contribution in support of the aid programmes of the UNDP, the World Bank and International Monetary Fund, thus contributing to the development. During the time Latvia has been developing and implementing its national development cooperation policy, it has not only contributed to the common EU development policy, but has also strengthened its status as a donor state, sharing its unique development experience with the developing countries and transition economies.

The framework and action directions of Latvia's development cooperation policy have been determined by the common foreign policy directions of the EU and Latvia and several policy documents: The Basic Principles[1], Development Cooperation Policy Programme of the Republic of Latvia 2006 – 2010 (hereinafter – Programme), Development Cooperation Policy Plans for 2005 and 2006 and the Millennium Development Goals.

To achieve the goals set by the Basic Principles and the UN Millennium Development Declaration and implement the EU development cooperation policy, Latvia must strengthen its capacity and status as a donor state, which by means of definite financial resources and its comparative advantages is both willing and able to extend assistance to developing countries.

Latvia's development cooperation policy has been drawn up to provide democratic reforms, observance of human rights and economic and social growth that will allow achieving sustainable development and eradication of poverty in developing countries and transition economy countries. Following the Basic Principles, and in order to contribute to the said development sectors, Latvia's participation in the EU development policy for the next few years should focus on the following directions: political dialogue, cooperation on development and trade, sharing valuable experience in implementing reforms with transition economy countries and developing countries, as well as co-participation in various aid projects and extension of humanitarian aid to countries having suffered natural catastrophes or other crisis situations.

The previously mentioned development cooperation policy directions are to focus on Latvia's priority regions – the CIS and the Balkans. These regions have been selected due to the mutual historic and cultural ties with Latvia, as well as the development goals set by individual countries of these regions that Latvia may help achieve through its valuable experience.

During the period from 2006 to 2010 Latvia will be strengthening its new role as an international donor, fostering a more active foreign policy for both bilateral activities and multilateral relations. The commitment "to strengthen Latvia's international role as a new donor, by ensuring wide involvement by public administration and society in defining policy priorities and implementing targets[2]" has been defined in the Programme. The objective set by the Programme represents a commitment to involve the wider public in implementing the development cooperation policy, which is also one of the directions related to strengthening Latvia's civil society in general. This ensures not only the achievement of the set objective, but also strengthen one of Latvia's comparative advantages in the fostering of democracy.

According to the Development Cooperation Policy Plan for 2006, Georgia and Moldova have been identified as priority countries. This decision has been based on the contacts established to date, foreign policy directions of these countries, desire to cooperate with Latvia expressed by these countries, as well as their territorial comparability and status as developing countries.

Georgia has also been identified as a priority recipient state in accordance with the EU Neighbourhood Policy in the South Caucasus and the desire expressed by the Georgian government to join NATO and the EU, as well as its commitment to strengthening democratic values. With regard to sharing its development experience with Georgia, Latvia has additional advantages, such as a common political, economic, structural and cultural history within the Soviet Union, as well as the experience of the post-Soviet transition period – an understanding of the problems related to the development of transition countries and Latvia's recent practical experience in having the status of a recipient country, and knowledge of the Russian language, which is still very useful in ensuring mutual communication.

In the Development Cooperation Policy Plan for 2006, the Latvian government has defined the following priority areas related to bilateral and trilateral cooperation projects:

  • support in reforming public administration, municipal and defence systems; support related to European and transatlantic integration process;
  • fostering of the development of a democratic and civil society;
  • education, culture, social development, health and environment protection.

Latvia's financial contribution to development cooperation to date goes beyond payments to international organizations, which is best illustrated in an overview of the amount of Latvia's financing to date for development cooperation as against the payments to international organizations (See Table below).

Development cooperation policy activities in 2005[3]

Year

Official development assistance (ODA) LVL

ODA/GNP ( GNP – gross national product)

Payments to international organizations

2002

501 583

0.01%

90%

2003

491 985

0.008%

90%

2004

4660 537

0.06%

97%

Based on approximate data[4] provided by the Principles, the total of LVL 88,773 in 1999, LVL 29,321 in 2000, and around LVL 898,201 (including multilateral cooperation) in 2001 has been allocated for development cooperation purposes (total ODA and OA - LVL 1,098,764; See Appendix). Latvia's participation to date in extending assistance has mainly been effected by reacting to individual situations. To ensure efficient implementation of development cooperation policy, the financing should be retained at not less than the present level. It is, however, preferable to increase financing so as to progressively move towards the amount of total financing equivalent to 0.17% of the Gross National Product, which is the target to be achieved by the new European Union member states by 2010.[5] The 2006 budget allocates LVL 150,000 for development cooperation purposes.

2. Georgia: situation analysis

2.1. Political situation

In considering Georgia's political situation, attention has been focused on the presence and operation of various democratic institutions. The analysis considers the country's internal security, free election rights, the rule of law that ensures the freedom and security of the citizens, transparency of public administration (corruption issue), observance of human rights, freedom of speech (freedom of the press), observance and protection of minority rights, stable society and development of civil society.

After regaining independence in 1991, Georgia has witnessed very slow and gradual development resulting from structural changes affecting all sectors, including socio- economic development, legislation, human rights and other aspects. This Strategy focuses on the time period following the so-called 'Revolution of Roses' at the end of 2003, as a result of which the previous President was peacefully deposed and the new President and government assumed power. This fact is important for the decision-making process in Georgia, in which the President has considerable influence over the government. The 'Revolution of Roses' was an impulse toward implementing new reforms and restructuring the existing ones.

According to the EU Neighbourhood Policy guidelines, the South Caucasus is one of the priority regions for strengthening development of common interests, including security issues. The recent changes in Georgia's political situation, and the commitment of the Georgian government to strengthening democratic values demonstrates that Georgia is open to structural transformation and development cooperation as seen by the Latvian government. The unity of interests of Latvia and Georgia reached their highest level with Georgia demonstrating its strong desire to introduce democratic values and move towards integration into the EU and the transatlantic structures.

Some years ago, the guarantee of free election rights, a basic cornerstone of democracy, was still regarded as a challenge in Georgia. Notwithstanding the guaranteeing of this basic right during the parliamentary elections in 1999, the presidential elections of 2000 and municipal elections in 2002, problems were still identified concerning relevant legislation and inaccuracy of the electoral registers.[6] The Presidential elections held at the end of 2003 following the 'Revolution of Roses' were characterised as democratic, yet the performance of the Electoral Commission and development of an accurate electoral register are two areas still pending in Georgia.

Although substantial improvements have been made following the 'Revolution of Roses', implementation of the rule of law and the legislative environment are two areas that still require major transformation. Improvement of the rule of law also implies dealing with the issue of corruption so as to make the administrative system more efficient, thereby contributing to development of an efficient public administration and economy. Major changes need to be effected in the legislation and operations of institutions to reduce the spread of corruption in Georgia at all levels of public administration. The situation has improved a little during the past year, with several cases of corruption identified and appropriate punitive measures taken, yet major upgrading of the system is still necessary to reduce the problem. According to research carried out by international organization "Transparency International", in 2003 Georgia was listed 7th of a total of 133 countries against the Corruption Perception Index.[7]

By joining the UN and the Council of Europe, as well as ratifying most of the Conventions on Human Rights, Georgia's government has made a commitment to respect, protect and guarantee human rights within its territory. The reports prepared by international organizations (Human Development Report, Programme for Economy Development and Poverty Eradication) have stated that human rights are still one of the areas most under threat in Georgia. The situation needs to be addressed and improved in the immediate future.

Georgia is very diverse as to its ethnic structure and the religious beliefs of its inhabitants. The population of the country consists of 83.3% Georgians, 6.5% Azerbaijani (Azeri), 5.7% Armenians, 1.5% Russians and 2.5% other ethnic groups. An overview of the various religions in Georgia shows that the biggest representation is that of the Orthodox Christians at 83.9%, followed by the Armenian-Gregorian Church at 3.9%, Catholics 0.8%, Muslims 9.9%, and other religious groups.[8] The official state language in Georgia is Georgian, spoken by 71% of the population; 9% of the population speak Russian, 7% the Armenian language, and 7% speak other languages.[9] Due to this level of diversity, the protection of minority rights is one of the main challenges facing Georgia. It should be noted that the presence of such a variety of ethnic and religious groups in Georgia has provided the basis for many of the internal conflicts taking place within the country.

Since 1991, conflict situations have mainly affected two Georgia's regions – Djavakheti, Abkhazia and South Ossetia. These conflicts have put the overall stability of the country at risk, particularly with regard to the observance of human rights, as well as security and stability issues.

Following the civil war in 1995, the economic and social crisis deepened, providing a negative impact on the human rights situation in Georgia. The Council of Europe has identified two main issues arising in this respect:

  • Torture inflicted by members of law enforcement institutions during pre-trial custody of suspects;
  • Attacks directed at the "non-traditional" religious groups.[10]

These aspects highlighted by the Council of Europe point to the large number of unsolved issues related to the human rights situation in Georgia, particularly the observance human rights in jails and the protection and observance of minority rights.

Civil society, on the one hand, is well-developed and active in implementing public policies through relevant public organisations, as well as through involvement of the society in the decision-making processes, expressing its opinion and attitude regarding ongoing events in the country and promoting public co-participation in improving the overall quality of life. Public institutions participate in the decision-making and implementation process, including co-participation in various councils preparing the action policy of relevant state institutions, and expressing their opinion as to ongoing events in the country. Notwithstanding this, the third sector and its consciousness are still under development. According to information acquired through consultations, about 2000 public organizations have been registered in Georgia, of which around one tenth could be classified as active. The public organizations that are more visible and active in their operation are financed by international donors. There is no stable and uniform sector of public organizations that makes necessary participation.

2.2.Economic situation: achievements, challenges and prospects

The first years after regaining independence have been difficult for Georgia in terms of social economic development. Difficulties existed in the systematic administration of the social and economic processes. Internal political discrepancies, separatism, civil war and criminal activities have all had a devastating impact on the country's economy.[11]

With the introduction of the new national currency - the lari (GEL) in 1995, the previous high level of inflation was reduced; in 1993 inflation had reached 13%, whereas by 1997 it had reduced to 7.3%. Budget income was also increased. In 1995, the level of budget deficit as against the GNP dropped threefold in comparison to previous years. [12]

The financial crisis affecting Russia in 1998 also severely impacted Georgia's economy, causing devaluation of the lari. The crisis resulted in GNP decreasing to 2.9% in 1998, compared with 10.7% in 1997.

In 2002, the country's external debt amounted to USD 1,592.64 million, which constituted 47.42% of GDP. This indicator was made up of payments effected by international financial organizations: USD 771,445 million; and USD 757,122 by bilateral creditors. The International Monetary Fund and World Bank are Georgia's largest creditors. In 2002, the country's internal debt totalled GEL 1,484.3 million. The major proportion of these payments was the debt to the National Bank of Georgia.

According to data provided by the Georgian State Statistical Department, in 2004 Georgia's gross domestic product (GDP) was GEL 9,800 million or USD 5148.8 million. This means that the GDP per capita constituted about GEL 2160.8 (USD 1135.3 or LVL 693.4). The actual GDP increase was 8.4 %.[13] The per capita GDP indicator between 1990 and 2002 was 3.9%. The per capita GDP indicator has decreased from USD 2,664 in 2002 to USD 2,260 in 2004, whereas the Gini ratio (index of income concentration) has dropped from 37.1 in 2002 to 36.9 in 2004. [14]

In general, the macroeconomic situation reveals stability of prices and reduced inflationary indicators. This stability is a significant achievement, yet the economic growth of the country and improvement of its social situation still remain a big challenge for Georgia.

According to calculations by the Georgian Ministry of the Economy, Industry and Commerce, shadow economy in the country represents 34% of the whole economy. This affects both the general macroeconomic situation of the country, and its socio-economic environment. To facilitate attraction of investments to Georgia there should be an appropriate business environment and efficient financial and investment institutions established in the country. Notably, one obstacle to the attraction of investment is the high level of corruption in Georgia.

With regard to specific sectors, it should be noted that in 2004, positive development was observable in the industrial, construction, transport and communications sectors, while some negative growth could be seen in the agricultural, financial intermediation and educational sectors. [15]

The devising of the new tax code implemented starting from 1 January 2005 represented a major improvement to Georgia's economic and financial governance system. Through this, the reform of the tax system was carried out. The objectives of tax system reform in Georgia are to provide for a better environment for entrepreneurship, ensure more favourable working conditions for local and foreign investors, simplify tax payment procedures and legalise the shadow economy. A new system of seven types of tax replaced the previous twenty-one and comprised: the social tax, profit tax, property tax, income tax, value-added tax, excise tax and gambling tax. Likewise, it is intended to reduce the rate of taxes – social tax to 20% (replacing 33%), value-added tax to 18% (replacing 20%) and income tax to 12%.[16] The two main benefits thus enjoyed by taxpayers will be:

1) lower taxes and greater amount of cash in circulation;

2) simplified tax calculation mechanism.

The restructuring of the tax system has inspired the creation of the office of the Ombudsman, representing another significant turning point in terms of protection of taxpayer interests.

Georgia's government has committed to transformation of the country's economy by simplifying the levies and dues and licence acquisition system, optimising the operation of the control institutions and implementing reforms of the tariff regulatory institutions.

One of the main objectives of economic growth is to enhance welfare of the population, which is why it is important to review not only macroeconomic indicators, but also assess the impact of economic growth on the welfare of the population. With regard to the level of household income, statistics indicate that based on spending, the average monthly salary in Georgia is equivalent to GEL 104.1 (~ LVL 33,4), or 85.6% of the official minimum subsistence wage. The official minimum subsistence wage in Georgia is GEL 124-128(~ LVL 39,8- 41,0) per month for an adult of average working age. The income level below extreme poverty range is GEL58-63 (~ LVL 18.6- 20.2) per month per adult of an average working age.[17] The minimum wage is 40% of the minimum subsistence wage. The majority of the population are self-employed persons in the agricultural sector. The employment level continues to grow in the private and agricultural sectors, but is dropping in other sectors.

Although state support does not constitute a large part of total household income, in 2001 state support was received in 60% of households in Georgia. In 2002, about 40% of households had borrowed money, of which 80% had not yet repaid in full.

Household spending has been subject to growth. In 2002, the average monthly household expenditure per household was GEL 325.9 (~ LVL104.3), equivalent to about GEL 87.4 (~ LVL 28) per capita a month. A major part of household spending is on food. The high percentage of the total expenditure together with the average income level of the inhabitants in Georgia reflect the harsh socio-economic living conditions which still exist notwithstanding the improved macroeconomic indicators of the country.

2.3. Social situation: achievements, challenges, prospects

Both the economic and social indicators show that living standards in Georgia are low. The level of poverty continues to rise, particularly in the rural areas. The poverty level in Georgia is characterised by such problems as low income level, uneven distribution of income, unemployment, lack of housing, and migration due to economic reasons.

According to data provided by the Georgian State Statistical Department, in 2003 54.5% of the population lived in poverty, which, at 2.4% more than 52.1% in 2002, represents a significant increase in the poverty level. Based on data provided by the Georgian State Statistical Department, the dynamics of the poverty indicators for the period between 2000-2004 show that the poverty level has increased proportionally with the increased spread of poverty in rural areas; in 2000 46.6% of rural inhabitants lived in poverty, whereas in 2004 the number had increased to 54.4%. The poverty indicator in urban areas has decreased from 57% in 2000 to 51% in 2004. The level of extreme poverty has also increased from 14.3% in 2000 to 16.9% in 2004; the increase has been particularly dramatic in rural areas where the number has grown from 14.1% to 19.5% between 2000-2005.

Among the most significant factors contributing to the existence of poverty are unemployment and issues associated with employment. According to data provided by the Georgian State Statistical Department, during the period 2000-2004, the unemployment level in Georgia increased from 10.3% in 2000 to 12.6% in 2004, whereas the employment indicators dropped from 58.4% in 2000 to 56.7% in 2004, the latter trend particularly intensifying during 2004. The unfavourable employment/ unemployment indicators have considerably affected the overall development of Georgia's population and social problems, including the low incomes and pay levels. In 2004, the average income level per employee was GEL 120 (~ LVL 38,5), or 89.2% of the minimum subsistence level. A lack of food is observable in a great proportion of households and it is common for people to live in hunger[18]. Statistical data regarding unemployment indicates that in 40% of households in the extreme poverty group, none of the family members is employed, while in 45% of households in this group one member of the household supports two or more family members.

Since regaining independence, Georgia has undergone major changes to its demographic situation. The decreasing birth rate, intensive emigration and large proportion of people of reproductive age among the emigrants have all contributed to the overall "ageing" of its population. The proportionally large emigration from the country is mainly associated with the socio-economic difficulties experienced by the country - the relatively small number of well-paid jobs, and inappropriate conditions hindering the promotion of entrepreneurship have been the main cause of people seeking to live outside the country. Such emigration processes could eventually lead to a dramatic reduction in the number of economically active inhabitants, increasing the socio-demographic pressure on the actively employed members of the population. The employment activities undertaken by this segment of the population provide the main source of subsistence for the inhabitants of pre- and post-economically active age[19].

Georgia's government has begun implementing transformation of the social support system. In establishing the social support system, the main focus will be on support for the households living in extreme poverty, rather than identifying specific social groups entitled to this assistance. Accordingly, a new system and methodology will need to be developed to identify such households.

The main objective of Georgia's educational system is establishment of a high standard educational system and ensuring its availability. The law on higher education drafted is of crucial importance. Such legislation would be the first to provide the basic operating principles of higher educational establishments, such as academic freedom. Likewise, the issue regarding the education of orphans and children not supported by their parents also needs to be resolved. The problems affecting the educational sector have been caused by a low level of attendance and small number of graduates from educational establishments, poor administration of schools and human resources, and a low standard of teaching methods and curricula. The problems affecting the educational system as a whole, the education of orphans and children not supported by their parents, are rooted in the central governance and administration of the health and educational sectors, the low percentage of state financing, underestimation of the importance of the role of civil society, and the low capacity of relevant personnel in policy elaboration and planning.[20]

Education is also a crucial component of the human resource capital. Traditionally, Georgia has been associated with universal education opportunities. School attendance stands at 98%. No more than 5% of the population have either an elementary education or have not finished primary school. 40% of the population aged 15 and older have a secondary education, 20% a professional education and 24% have a tertiary education. Inequality of opportunities in education continues to increase among young people who are poor and have less chance of acquiring high quality tertiary education. Government expenditure on education is only 2.5% of the GDP. [21]

The seriously challenging socio-economic situation over the past years has caused a considerable deterioration in the health of the population. The birth rate has decreased, whereas mortality has increased, resulting in an overall decrease of the population. Adding to the negative demographic indicators, there has been an increase in the incidence of socially dangerous diseases and inhabitants with tuberculosis and mental illnesses, and a significant increase in the number of illnesses that could have been prevented by vaccination. The health of the population needs to be improved along with eradication of poverty and providing health care for the socially disadvantaged.[22]

The deterioration of the social services sector has resulted in overall deterioration of the health of the population and poor and ineffective operation of the educational sector. Deterioration of the health situation of the population in Georgia has resulted in a low quality of social services and inappropriate utilisation of human resources, as well as a low awareness level of available health services and low trust in the quality of such services.[23]

In 2002, the average predictable lifespan was 76.1 years; 73.7 years for males and 78.7 years for females. The infant mortality rate per 1,000 infants born alive and aged up to one year fluctuated from 27.8 to 20 in the period 1996-2002, whereas the mortality rate of mothers giving birth during the period 1993-2000 varied from 32 (1993) to 70 (1997) and 58.7 (2002). Starting from 1990, the mortality from heart and vascular diseases has increased by 35%. Likewise, there has been a significant increase in the mortality caused by ischemic diseases. Tuberculosis still remains a major threat. Prisons are the main source of infection, where 5-10% of prisoners suffer from this disease. The spread of tuberculosis has also increased among children and adults. With regard to HIV/AIDS, 232 patients were identified in 2002. The number of HIV positive people is currently around 2,000. The spread of disease is facilitated by an unhealthy lifestyle, lack of elementary knowledge, low diagnostic capacity and underdeveloped preventive medical treatment. The consumption of tobacco has reached a catastrophic level of 65.5% for males and 15.7% for females. The indicator for children aged 12-17 shows 55% for boys and 45% for girls. 28% of pregnant women aged 17-25 smoke. The government expenditure on health is one fifth of the total expenditure, and is mainly focused on health care rather than preventive measures.

3. Development cooperation challenges and Georgia's priorities

Georgia has set its development priorities based on the current situation in the country and its foreign policy development directions. These priorities have also been approved by the most influential external donors, and provided for in the respective development strategy documents.

The main objective of this section is to provide a summary of Georgia's development priorities and main action directions of the external donors, as well as activities undertaken by the donors toward these directions.

Presently, Georgia's development directions and targets are outlined in several strategic development documents:

1. Economic Development and Poverty Reduction Program (EDPRSP) and the associated Progress Report.

2. Millennium Development Goals (MDG)

3. Priorities set by Georgia's government concerning the European Union Neighbourhood Policy Action Plan (ENP Action plan).

4. Letter to donors regarding Georgia's urgent priorities for the time period of 2004 -2006

5. Individual Partnership Action Plan for Integration into NATO (IPAP)

Based on Georgia's development goals the following reforms need to be implemented[24]:

1. Reforms related to integration into the EU and NATO:

  • Harmonisation of legislation;
  • Ensuring internal and external security of the country.

2. Resolution of governance and corruption issues:

  • Eradication of corruption in the public space, as well as establishment of an independent and competent judiciary system;
  • Meeting EU standards through harmonisation of legislation;
  • Introduction of a competent and modern public administration system, including the procedures, institutions and development of a competent civil service within the institutions of the legislative, executive, and judiciary branches of government;
  • Involvement of civil society in anti-corruption activities and public administration reforms;
  • Developing an efficient public finance administration and fiscal system.

3. Energy sector renewal:

  • Renew the energy sector;
  • Regulate the operation of the energy sector so as to continue work on reducing the volume of outstanding bills, improve the quality of services and financial situation of the energy companies, and increase the level of investment from the private sector;
  • Ensure long-term self-sufficiency of energy companies, attracting private capital, utilising as yet unused hydroelectric power resources, and reducing the amount of energy imported.

4. Poverty eradication and social services

Implementation of reforms in underdeveloped sectors: health care services, education and social security:

  • Protect socially vulnerable people, ensure primary health care services, consolidate resources for acquisition of primary and secondary education and develop social security benefits and state/private pensions system;
  • Contribute to children's welfare issues, focusing on essential parental care for children, maternal security and appropriate care services.

5. Development of the private sector, including tourism

  • Improve the environment for private entrepreneurship by eliminating administrative barriers, upgrade the tax code, apply modern standards and control mechanisms facilitating increased competitiveness of exports, and promote tourism;
  • Improve supervision of fiscal institutions and enhance unity of the banks so as to ensure efficient management of resources.

6. Development of sustainable agriculture in regional areas, and environment protection

  • Facilitate investment in high quality agricultural products, and complete the development of the grain harvesting, milling and processing system;
  • Upgrade the food security system, focusing especially on the poorer and more depressed regions.

7. Infrastructure development

  • Continue liberalisation of transit regulations so as to reduce transport costs and merge all transport related regulatory functions into a single agency;
  • Strengthen road administration, develop an institutional system for water/waste management sectors and finance investments;
  • Draw up and approve social housing policy, provide preconditions for a partnership between the state and private sectors in developing housing and introducing a new financing model;
  • Concentrate on environmental issues to resolve issues related to forests, protected natural areas, coastal zones and transport of oil (by sea and road), and introduce legislation requiring assessment of the impact of new investment projects[25].

According to information provided by the Georgian government, the most important reforms implemented in 2005 relate to amendments to the law on licensing and the tax code, which provide for a considerable decrease in the number of taxes payable, as well as the reform of the tax administration system. It is also envisaged that work on issues related to the Labour Law and trade policy will commence shortly.

Consultations conducted to assess the objectives listed above lead to the conclusion that, despite the agreement reached between Georgia's institutions and international donors with regard to sectors requiring reform, opinion differs as to priority tasks. Likewise, regardless of the fact that the Economic Development and Poverty Reduction Program and other major strategy documents are informative and analytic of the current situation in Georgia, they are rated more highly by the international donors, than by representatives of various Georgian institutions, who expressed the view during consultations that these documents do not reflect the true situation in Georgia. This attitude is also inspired by the fact that the number of priorities listed in the strategy documents is very large, which, as voiced during consultations, raises doubt as to whether all Georgia's listed development strategy directions can be considered priorities, as there are too many to be resolved simultaneously. Nevertheless, the documents are an official source of reference, and are taken into account in view of the financing that has been attracted. This situation has resulted not only from the large number of strategic documents but also from the belief in Georgian institutions that the documents reflect only the priorities recommended to Georgia by international donors. This is regardless of the fact that together with international experts, representatives of relevant Georgian institutions and its public sector have also been involved in the preparation of these documents. To improve this situation, the relevant ministries of Georgia are each currently drawing up their own vision for action and formulating targets for agreement on tasks to be given priority at the governmental level. This process is being coordinated by the Office of the Minister for Coordination of Reforms.

After summing up Georgia's development directions and targets listed in the strategy documents and opinions expressed during consultations, and aligning them with Latvia's development cooperation priorities, the priority action directions and targets of Latvia-Georgia development cooperation are identified for the next three years as follows:

  1. Foster Georgia's integration into the EU and transatlantic structures, by harmonising legislation and working towards meeting standards and requirements set by these organizations;
  2. Establish a modern and competent public administration system, including the procedures, institutions and development of a high quality civil service;
  3. Enhance the development of democratic society and civil society;
  4. Reduce poverty, ensuring primary health care services, consolidating the resources for primary and secondary education, and setting targets for establishing a social security and pensions system;
  5. Ensure the development of the state economy by improving the business environment and introducing modern standards and control mechanisms.

3.1. International donors contributing to Georgia and their action priorities

Taking into account the complexity of state development and the financial instability in Georgia, a large part of Georgia's state functions have been supported by international financial donors since the very early days of Georgia's independence. The volume of such support continues to grow as state policy moves towards the development of democracy.

According to very approximate calculations provided by the Georgian government, the value of current projects and programmes supported financially by international donors was about USD 521 million (excluding state budget support) in 2004.[26]

The largest international donors contributing to Georgia are the US government, the World Bank and the International Monetary Fund, together providing 70% of the total assistance. The US contribution to Georgia amounts to USD 1.2 billion. The World Bank's total contribution to Georgia is more than USD 640 million. Other major donors to Georgia include the EU, the European Bank for Reconstruction and Development (EBRD), UN institutions, Germany, and others.[27]

Assistance provided by the International Monetary Fund totals USD 470 million. This assistance supports outstanding payments. The reforms resulting in macroeconomic stability allow for economic growth, which has already been achieved.

The total contribution by the World Bank to Georgia is USD 640 million (at 1 July 2002). To support structural reforms the World Bank has allocated USD 319 million, of which USD 280 million were transferred directly to the state budget, representing more than 60% of the World Bank's credit. The remaining resources were made available through various investment projects across nearly all sectors. The World Bank has supported the following sectors – structural reforms, social infrastructure, transport, agriculture, environment protection, energy, health and social insurance, reform of the judiciary system and development of the private sector.

The priority cooperation sectors defined by the World Bank's strategy for Georgia for 2004 – 2006 are as follows:

  • Achieve faster and more extensive development of the private sector by eliminating the institutional and infrastructural barriers hindering the development of the private sector;
  • Develop and strengthen the human resource capital and social protection, as well as enhance environment protection by means of short-term assistance and long-term sustainable programmes so as to protect the less developed sectors;
  • Improve governance and ensure efficient management of public expenditure including strengthening management of public expenditure through annual reports on public expenditure focused on the relevant processes.[28]

United States of America the largest donor to Georgia, with a financial contribution in excess of USD 1.23 million. US assistance focuses on four directions:

  • Renewal of economy – assistance extended in support of the economical transition period and private sector and in building the economical and finance related legislative framework for investment development;
  • Energy – assistance has been extended to support privatisation and restructuring, including legislative and regulatory reform, to increase private sector contribution to the energy sector;
  • Democracy and governance - the US has assisted in enhancing democratic governance and preparation of various laws, including the administrative code, legislation regarding licensing, the law on state secrets and the law on freedom of speech. The US has also contributed significantly to the establishment of the Constitutional Court and facilitated the independence of the media. The US has supported the establishment of several information agencies and professional media associations, as well as a number of public organisations.
  • Social sector – since 1999 the US has annually financed the heating system for the winter season. Under this Programme heating is provided to 300,000 people from various organizations, and to socially vulnerable groups – senior citizens, hospitals, orphanages, delivery homes, nursery schools and refugee centres.

USAID Caucasus the overall target for the period 2004 -2008 - to strengthen the capacity of Georgia's society in upgrading the crucially important services; renew profit generation and ensure that public opinion is taken into account by the government; the sub-target: facilitate the emergence of new values and attitudes that would assist Georgia's inhabitants to assume responsibility for development of their country.

Based on these targets, USAID has focused its operations on five areas:

  • Increase the tempo of development and growth of private entrepreneurs by creating new jobs;
  • Contribution to the development of a more stable energy system;
  • More efficient and responsible local governments;
  • Facilitate improvement of social and health care services for specific target territories;
  • Special initiatives: elections and activities related to anti-corruption measures and elimination of human trafficking.

The United Nations commenced its activities in Georgia in 1993. Initially UN support was provided as humanitarian aid only, but later its attention also focused on improving the social and economic situation. The UNDP focuses on three directions:

  • Development of human resources through improvement of public administration;
  • Eradication of Poverty;
  • Economic growth and environmental assessment?

In the period 1997 - 2000, the UNDP allocated USD 30 million of which USD 16 million was provided by the UNDP, and more than USD 13 million by its partners, international financial institutions, bilateral donors and public organizations. 28% of technical assistance has been to facilitate economic growth, 64% for governance (public administration) purposes and 8% for environmental protection.

The activities under the World Food Programme have focused on the extension of long-term assistance to socially vulnerable groups and lessening the degree of dependence on imported food. Under the Programme, USD 2.3 million has been allocated to Georgia.

Food and Agriculture Organization assists development of the agricultural sector by increasing living standards and agricultural productivity. The objective of the Agricultural Development Fund is to mobilise resources to eradicate poverty in rural areas. The assistance provided under the Fund totals USD 36.2 million.

The United Nations High Commissioner for Refugees assists in resolving conflict issues by increasing the level of security, control over the post-conflict zones, and facilitating essential humanitarian aid to people with disabilities (IDP) assisting their rehabilitation.

The United Nations Development Assistance Framework for Georgia for 2006 -2010 is sets five assistance areas:

  • Poverty eradication and economic growth;
  • Governance;
  • Basic social services;
  • Uncertainty and instability;
  • Environment.

Between1992-2000, the European Union provided EUR 600 million to support various programmes, including TACIS, special financial assistance, food security, rehabilitation, support in resolving border issues, and humanitarian aid.

TACIS is the most significant EU support programme. Georgia has received more than EUR 70 million under various grants (not including regional projects). About 250 projects have been implemented in the following sectors: energy, transport, agriculture, statistics, development of human resources, telecommunications, public administration reform, development of the private sector, environment protection, finance and education.

The most important regional programmes are TRACECA and INOGATE. Funds allocated through INOGATE since 1996 total EUR 46 million. The projects provided assistance in assessing feasibility of the oil and gas pipeline, development of a new generation oil and gas transportation system, support in implementing small size investment projects, and transfer of know-how related to environment protection issues focusing on hazardous infrastructures, pipelines and resources. 28 technical assistance projects worth EUR 40 million and 7 investment projects worth EUR 15 million have been financed through TRACECA in the period between 1998-2003. One third of the assistance projects have been co-financed by the World Bank and the European Bank for Reconstruction and Development.

Georgia's Development Strategy, developed by the European Commission, has identified the following priorities:

  • Facilitate the rule of law, good governance and observation of human rights and democratic values, including strengthening of civil society and enhancing active co-participation of public organisations in moving towards practical democracy;
  • Special activities undertaken to eradicate poverty moving towards the overall EU poverty eradication policy. Assistance will be directed at the most vulnerable groups by increasing access to health care services and special social protection networks;
  • Foster elimination and resolution of conflicts and post-conflict rehabilitation.

The European Commission's main development programmes are as follows:

  • TACIS (Technical Aid to the Commonwealth of Independent States) is an agreement entered with the Georgian government. Its current priorities are to support institutional reform and the social consequences resulting from the transition period;
  • TACIS Regional (Interstate) Programme, inclusive of the TRACECA and INOGATE projects;
  • FAO's Special Programme for Food Security – focused on management of state budget expenditure (such as agricultural purposes and social support to orphans, and education related issues);
  • Macro-financial assistance to Georgia – in 1998 a loan equalling 110 million EUR was provided. Georgia has received EUR 25 million in its state budget, effected by means of various grant projects;
  • Post-conflict rehabilitation – several projects implemented in South Ossetia;
  • ECHO- Humanitarian aid to Georgia (including Abkhasia).

The European Bank for Reconstruction and Development (EBRD) has approved 18 projects in Georgia related to energy, financial institutions, transport, natural resources and agriculture. The EBRD has also financed five regional projects. Total EBRD contribution to Georgia amounts to EUR 250 million, of which 60% were spent by 2003. It should be noted that 61.4% of the contribution has been facilitated by the private sector and 38.6% by the state sector.

Germany has contributed significantly to Georgia, investing DEM 378 million by 2003. About 300 million were provided by the German's bank for Reconstruction (KfW Entwicklungsbank) in direct investment projects. The main sectors supported by Germany's Bank for Reconstruction are energy, agriculture, land cadastre system and environmental protection. DEM 160 million have been invested in the energy sector, equivalent to 53% of total assistance provided. Assistance for agriculture and the land cadastre sectors totals more than DEM 45 million, or 15% of the total assistance provided. Assistance has been provided to support establishment of a modern land cadastre and registration system, providing appropriate conditions for successful operations. Assistance for environmental protection amounts to DEM 20 million, or 7% of the total assistance. The remaining 20% of financial resources provided by Germany has been implemented in various types of technical assistance and humanitarian aid.

Assistance extended by Japan amounts to USD 80 million and has been focused on three priority sectors – energy, agriculture and health care.

The assistance provided by the Netherlands amounts to USD 60 million and is mainly for cooperation in developing the economy. The Dutch have supported macroeconomic stability by co-financing World Bank projects, improving governance and observance of human rights, and participating in various conflict elimination programmes. Modernisation and rationalisation of public finance, anti-corruption measures, improving the work of local governments, decentralisation, and protection of human rights, are the main focus area of the various financing programmes. The long-term economic cooperation objective is to facilitate Georgia's transition to an effective market economy.

The main focus of assistance extended by Turkey is the implementation of the oil and gas pipeline project. Technical assistance and small grants for various institutions are available through the Turkish International Cooperation Agency. The Agency has organised training in customs, trade and tourism. Between 1994-2002, the total amount of its supported projects was USD 1.5 million Turkey is Georgia's main trading partner and has also contributed significantly to state defence issues. The total assistance amounts to USD 30 million.

Since 1995, the Swedish International Development Agency (SIDA) has been contributing to economic growth, economic and social equality, economic and political independence, environmental protection and gender equality, facilitating the implementation of various energy-related and educational projects. In the period 1995-2003, Sweden has allocated USD 4.4 million.

The assistance extended by the UK between 1994-2002 through various programmes amounts to USD 11 million. The UK Department for International Development has extended technical assistance for poverty eradication, agriculture, health, governance and conflict elimination.

The Chinese government has allocated about USD 5 million for private sector development[29].

The Canadian International Development Agency (CIDA) has identified the following priority areas for its activity in Georgia for the next five to ten years:

  • Support to state and private institutions to facilitate transparency and efficiency, promote the formation of new companies and increase the level of employment in target groups within specific groups of society;
  • Improve the operation of relevant governance institutions and structures; stability, transparency and compliance with international legislation;
  • Efficient development and implementation of public services, as well as appropriate regulation of such services by the central and local governments and relevant public organisations.

The Baltic States

The Baltic States' positions regarding development assistance are similar, due to their common experience in development and implementation of reforms, and their geographic location. In view of the interest of the three Baltic States in realising themselves in the area of development cooperation policy, it is recommended that they consolidate their capacity and financial resources, and coordinate activities related to assistance projects. In the course of consultations it has been ascertained that delegations representing Lithuanian and Estonian governmental institutions have visited Georgian public administration institutions and international donors to learn more about the situation in Georgia and identify directions for cooperation.

To date Estonia has implemented several assistance projects, by financing training seminars for representatives of public administration, and focused on various European Union issues. Estonia is participating in the World Bank's educational system project through activities related to provision of Internet access to schools. The Estonian Ministry of Foreign Affairs has identified several projects for which funding has been requested. These projects are for training and purchase of computers. The assistance provided by Lithuania has become more intensive with the opening of its embassy in Tbilisi. The Lithuanian Ambassador to Georgia is actively following the ongoing processes in Georgia, participating in negotiations with relevant officials to share the benefit of Lithuania's experience. The relevant Georgian institutions are currently acquainting themselves with Lithuanian approaches to resolving anti-corruption issues and have voiced their support to the development of a similar system in Georgia.

4. Overview of earlier and current Latvia-Georgia cooperation

To identify the sectors for further Latvia-Georgia cooperation, it is necessary to review cooperation to date. Information about the status of cooperation to date, including the cooperation projects, events, bilateral visits, consultations, etc. has been acquired from various documents and consultations held in relevant Latvian and Georgian institutions.

This section includes the cooperation within the framework of development cooperation, beyond – from a wider perspective related to various sectors.

The assistance provided by Latvia includes various aid-focused events in which representatives of Latvian institutions are participating as partners, and the co-participation of Latvian experts in various international projects. An example of successful cooperation is the OSCE, where Latvian representatives have participated in resolving border control and educational issues. Likewise, a Latvian representative is also participating in the EUJUST Themis project in Georgia financed by the European Commission, acting as a legislative mission expert. A Latvian expert is also participating in the EU Anti-Corruption Network mission in Georgia.

Since the restoration of independence in both countries, their cooperation has focused on the following sectors:

ASSESSMENT OF COOPERATION TO DATE RELATED TO INTEGRATION INTO THE EU AND NATO

Regular political dialogue between the parliaments of both countries has been maintained within the framework of bilateral and multilateral relations. Exchange visits of the Presidents and Speakers of the parliaments of both countries have been held in both Latvia and Georgia. Regular consultations on issues related to European integration are being conducted among the parliamentary committees, the Latvian side represented by the European Affairs Committee, and the Georgian side – by the Committee on European Integration. The Latvian side has provided for in-service training of two Committee consultants in the Latvian parliament. It should be noted that cooperation has also been commenced between the Latvian and Georgian Human Rights Committees. A Latvian delegation visited the Human Rights Committee of the Georgian Parliament in September 2005.

As the operation of the Georgian media is underdeveloped and the journalists lack opportunities to improve their education, the Saeima (Parliament) of the Republic of Latvia has suggested inviting Georgian journalists to Latvia to learn more about state institutions and EU-related issues. This project could be implemented within the framework of existing parliamentary cooperation.

The cooperation between both countries is being implemented not only by means of experience and expertise exchange projects, but also by organising training regarding European integration issues for officials of the Georgian Parliament and the representatives of the Georgian Ministry of Defence in Latvian institutions.

Regarding defence issues, active cooperation exists between Latvia and Georgia in relation to implementation of Georgia's objective of joining NATO. Representatives of the Ministries of Defence and Foreign Affairs of the Republic of Latvia and Latvian Institute of International Affairs have provided several consultations to their Georgian counterparts. Although the defence sector is not directly regarded as an area of development cooperation, several issues exist related to matters traditionally regarded as pertaining to development cooperation. This applies to Latvia's assistance to representatives of the defence sector rendered via training in international relations, state protocol, public relations, human resources management, technical support, legal issues and defence planning.

With regard to home affairs, cooperation between both countries has focused on border security and monitoring. A representative of Latvia is participating in the OSCE mission in Georgia. Regarding the border guard issue, it is of great importance to Georgia to be consulted on how to develop and strengthen its border infrastructure, logistics, border control and international relations.

To date, cooperation in this respect has been successful, and as such will be expanded and strengthened, by ensuring the involvement of other institutions in the cooperation projects to be implemented. Thereby, Latvia will share its reform experience related to its integration into the EU and NATO, and home affairs.

ASSESSMENT OF COOPERATION TO DATE REGARDING HOME AFFAIRS

Latvia already cooperates with Georgia in the area of home affairs, by jointly combating terrorism, organised crime and illegal drug trafficking.

The Latvia-Georgia cooperation on border control has proven successful so far, and should continue. Latvia has also sent its experts to Georgia to advise on border issues. Cooperation and exchange of experience between the two countries is also facilitated by the fact that both share a border with Russia. Due to this, the exchange of experience and sharing of their best practices is of major importance.

Both countries have also cooperated in the exchange of expertise related to investigations methodology (applied in forensic psychiatry and medicine). Good cooperation has also been established between the Latvian and Georgian Police Academies, including the training of police officers.

ASSESSMENT OF COOPERATION TO DATE ON GOVERNANCE

Cooperation with Latvian representatives in the area of local government has been effected by consultations on this issue. The consultations have focused on distribution of joint responsibilities related to local government functions and financing, distribution of functions between central and local governments, introduction of decentralisation in Latvia, results and impact of such decentralisation on the local governance, and administrative territorial reform. In 2004, representatives of the Georgian government and local governments visited Latvia to discuss these issues with their Latvian counterparts The visit was organised by the Latvian Association of Local and Regional Governments and Norwegian Association of Local and Regional Authorities to agree on cooperation in the establishment of a Georgian Association of Local Governments. Shortly after the visit of the Georgian representatives an exchange visit was organised, with the Latvian representatives participating in the Georgian Local Governments Forum on the establishment of an Association of Local Governments.

The issue regarding the responsibilities and competencies of local governments in Georgia needs to be resolved in the near future.

Work on the Georgian draft law on local governments has been completed and is under consideration at this time. Likewise, it is of crucial importance to Georgia to ascertain how Latvian local governments implement their functions in practice, and how municipal work is organised.

ASSESSMENT OF COOPERATION TO DATE ON promotion OF DEMOCRATIC SOCIETY AND DEVELOPMENT OF CIVIL SOCIETY

Cooperation regarding the strengthening of civil society has taken place among various state institutions, as well as public organisations.

A visit of representatives of the Georgian Ministry of Education and Science and the Georgian Minister for Civil Integration has been organised with the purpose of learning more of Latvia's experience in cooperating with Latvians living abroad and minority organisations. As part of the visit, members of the Georgian delegation were also advised of the National Programme "Strengthening of Civil Society 2005 -2009". During the visit the Georgian guests also visited the Secretariat of the Special Assignments Minister for Social Integration, the National Agency for Latvian Language Training, the Latvian Social Integration Foundation and schools offering bilingual teaching. The Latvian Secretariat for Integration and the Georgian Ministry for Social Integration are planning to enter a cooperation agreement in 2006, thus strengthening existing ties. In Georgia, the Ministry of Education and Science has responsibility for all issues related to the development of civil society.

LPDC incorporates 23 public organisations that have united with the common objective of passing on their experience. During 2005, several exchange visits of the delegations of various Latvian and Georgian public organisations took place. In October 2005, a non-governmental organisations forum was held in Tbilisi. The forum was organised by the LPDC in conjunction with the relevant Latvian and Georgian state and public institutions, and has served as an impulse for a more active level of cooperation between the public organisations of both countries in the future. The LPDC has undertaken project coordination and assistance to other countries in finding cooperation partners in Latvia.

Cooperation regarding the promotion of democracy and development of civil society is to be expanded. The Forum of Latvian and Georgian non-governmental organisations in Tbilisi has provided a good impetus to this end.

ASSESSEMENT OF COOPERATION TO DATE ON ECONOMIC DEVELOPMENT

Latvia's experience in implementing economic reforms and developing the economy as a whole is of great value to Georgia. In view of the previous exchange of experience on standardisation issues initiated by the respective Georgian institutions, and conducted with the Latvian National Accreditation Bureau, Latvian National Meteorology Agency and the Consumer Rights Protection Centre, the relevant Latvian institutions of the economy sector are ready to offer consultations on Latvia's practices in resolving these issues.

In 2004, a Georgian delegation participated in a seminar on export control issues held in Riga. Likewise, during a visit to Latvia in 2003, representatives of Georgia visited several institutions of the Ministry of Economics, and met with representatives from the Latvian Railways, Civil Aviation Administration of Latvia, and the Road Safety Authority. The delegation also visited the port of Ventspils.

Development of its agricultural sector is also of great importance to Georgia. Cooperation in this area has been established by means of mutual exchange visits of representatives of relevant institutions, including the visit of the Latvian Minister of Agriculture to Georgia in 2004. Latvian partner institution for sharing practical experience is the Latvian Food and Veterinary Service. Currently, attention is mainly focused on food safety issues. Due to the highly developed wine industry in Georgia, it is anticipated that the Georgian side will wish to learn from Latvia's experience in development of food product standards, including defining of wine standards.

GENERAL CONCLUSIONS on LATVIA-GEORGIA COOPERATION TO DATE

Assessing Latvia-Georgia cooperation to date, it should be noted that cooperation has been focused on several sectors and implemented ad-hoc – through consultations and assistance tailored to specific purposes. Due to their unique transitional period experience, the Baltic States are of particular interest to Georgia, and cooperation between the Baltic States and Georgia has been implemented at various levels, from the legislative and executive branches of government, to the non-governmental sector. The joint cooperation projects are regarded as successful, with representatives of relevant Georgian institutions demonstrating a high level of interest in Latvia's experience in implementing reforms and developing systems applicable to specific sectors, by instigating direct contacts with representatives of the relevant Latvian institutions to discuss issues related to development and implementation of relevant policies. These contacts were initially at an informal level, after which representatives from Georgia contacted the Latvian Ministry of Foreign Affairs or the institution responsible for the respective sector expressing their wish to enter into cooperation or receive consultations.

The consultations and assistance have allowed the effectiveness of the contributions of both parties to increase. Georgia has thus been provided the opportunity to gain from Latvia's experience, and in future to act so as to avoid the mistakes earlier made by Latvia. Latvia has strengthened its bilateral and development cooperation relations, and its status and role as a donor state in development cooperation.

Adding to the positives, the joint cooperation projects have been initiated mutually, resulting in joining of efforts to agree on financial solutions, which, at the level of parliamentary cooperation of both countries, is manifested through a joint project Rapid Reaction Mechanism submitted under the TACIS Programme and in the public sector - through cooperation between LPDC and Georgian non-governmental organisations.

Latvia's experience is of value to Georgia, as both countries share a common past within the Soviet Union. Georgia can thus learn from Latvia's experience and avoid the same mistakes.

In view of this mutual initiative and existing cooperation between both countries, there are all the necessary pre-requisites for it to remain fruitful and beneficial and for further efficient implementation of development cooperation. The experience thus acquired will also be of great value to the Latvian Ministry of Foreign Affairs towards successful implementation of the development cooperation policy in the future.

 

5. Latvia's strategy for development cooperation with Georgia

Latvia's strategy for development cooperation with Georgia is based on the cooperation between Latvia and Georgia developed to date, Georgia's interests in learning from Latvia's experience, and the overall priorities for Georgia's development. The strategy incorporates the areas of cooperation that Georgia considers of crucial importance in gaining from Latvia's experience, and which comply with the country's development priorities. The initiative of the Ministry of Foreign Affairs and the UNDP to develop an expert database is a positive move. The database will incorporate information about professionals from various industries who are ready to share Latvia's experience in facilitating its development process and implementing the reforms, and provide consultations to Georgian institutions over the next three years regarding the pending reforms and development policies.

To implement long-term development cooperation priorities, the Latvian government could also devise a mechanism to facilitate the attracting of experts from other countries to provide consultations and services to Georgia on Latvia's behalf. Such cooperation would also be in line with UN recommendations regarding the announcing of open tenders on provision of development assistance, thus ensuring efficient utilisation of the financing provided.

COOPERATION TO FACILITATE GEORGIA'S INTEGRATION INTO THE EU AND TRANSATLANTIC STRUCTURES

Latvia's integration into the EU and NATO is one of the most important directions of cooperation, particularly since integration also represents one of Georgia's most clearly defined priorities, and in which Latvia has the benefit of relevant experience. Georgian requirements concerning these matters are split into the following sub-sectors and issues:

  • Management and coordination of the accession talks;
  • Experience in aligning the interests and protection of state interests, including the practices of political lobbying;
  • Coordination of integration processes within the country and distribution of responsibilities among various institutions (including the parliament, government, ministries, consultations with representatives of the civil society, etc.)

Assistance to the sub-sectors listed above can be provided by developing training modules for representatives of state institutions, as well as those of the public sector representing organisations that deal with integration into the EU and NATO. The training could be delivered in multi-level training modules. It could start with a theoretical course dealing with basic EU and NATO operational principles, obligations, rights and cooperation among the various EU and NATO member states and institutions. The course could be conducted in Georgia to reach the maximum practicable target audience. The second phase of training – the practical module, would be offered to the most successful participants in the theoretical part of the training who, upon its completion, would be invited to undertake practical training in relevant Latvian institutions.

Among the institutions that Georgia has identified for potential exchanges of experience is the Translation and Terminology Centre (TTC). Translation of Georgia's laws and regulations into English, as well as the translation of directives into the Georgian language is currently a topical issue for the Georgian Parliament. The experience of the TTC in organizing its work and translating such documents would therefore be of great value to Georgia.

In September – October 2005, the results of the next TACIS project tender will be announced to the Georgian Parliament. Depending on the consortium selected to implement the project, Latvian institutions may also be involved in it and listed among the cooperation partners and/or institutions that Georgian representatives will wish to visit to exchange experience.

Integration into the EU and NATO has necessitated cooperation in the area of home affairs. Latvia and Georgia have already commenced cooperation in combating terrorism, drug trafficking and organised crime.

Cooperation has also been established concerning the border guarding, to be expanded in the future. Latvia has sent its border guard expert to the OSCE mission to Georgia. The common border with Russia is an issue both countries need to address jointly, by sharing their experience.

Good cooperation has also been established between the Latvian and Georgian Police Academies regarding training of police officers.

According to the Latvian expert participating in the EU THEMIS project, Georgia is interested in sharing Latvia's experience regarding forensic psychiatry and medicine.

COOPERATION IN DEVELOPING A MODERN AND COMPETENT PUBLIC ADMINISTRATION IN GEORGIA 

  • Efficient public administration is one of the most important aspects in Georgia's transition period. The public administration reforms implemented by Latvia may be regarded as generally successful. In addition, they are relatively recent (as of 1995), which means that this experience can be useful to Georgia for avoiding the mistakes made by Latvia.
  • assistance in implementing local government reform

The draft law on local governments has already been prepared, yet the discussions regarding the distribution of responsibilities between the central power and local governments are still ongoing. Exchanges of experience in this respect should be facilitated, particularly as cooperation has already been established by means of exchange visits of representatives of the relevant institutions. According to the information provided by the Latvian Saeima, the US National Democracy Institute is ready to provide financing for an exchange visit of Georgian representatives to one of the Baltic States.

  • Assistance in implementing reform of public administration

As reform of the public administration is a complex process consisting of several reforms, assistance to this sector may be considered in terms of the following sub-sectors:

1. Latvia has formed an efficient and functional action policy development and coordination mechanism linking the various ministries and their sub-institutions. Coordination is implemented by the State Chancellery reporting directly to the Prime Minister, ensuring the coordination of development, implementation and management of sectoral policies and their compliance with the priorities as set by the government. As the Georgian action policies are not mutually coordinated and there is no coordination centre reporting directly to the government, Latvia's experience in this respect could be valuable to Georgia. Assistance to this sector can be facilitated by direct consultations, and support in strengthening the capacities of the established institutions responsible for public administration, such as the State Chancellery and the Office of the Minister for Coordination of Reforms.

Introduction of strategic planning should also be treated as one of the crucial elements in implementing state reforms, with special focus on aligning of the targets set as a result of planning with the planning of the state financial budget and expenditure. One of the main objectives of strategic planning is to alter the basic principles on the basis of which funds are allocated, shifting focus from financing specific institutions to financing reasonable and measurable objectives from the state budget. Assistance will therefore have to be provided at least to the central public administration institutions for development of strategic plans.

Such assistance can be effected by means of training: practical seminars in which experts assist in finding and formulating the most appropriate solutions applicable to the Georgian public administration system and institutions. The practical training should be followed by the promotion of 'horizontal' cooperation among the relevant institutions.

In view of the emphasis on increasing administrative capacity in Georgia's public administration reform policy, Latvia's assistance should be focused not only on specific institutions and their training, but also on the development of a training system for officials of state institutions. To facilitate this, the Latvian School of Public Administration and State Chancellery could share their experience in developing and implementing various training modules. As the Georgian School of Public Administration (based in Kutaisi) has been established fairly recently, it will need consultations and advice on development of training modules for representatives of public administration and local governments. This school focuses on regional local government staff located near the Armenian border, where local government officers do not speak or understand the Georgian language.

During the consultations with members of the Georgian Civil Service, the Georgian side has expressed their desire to learn from Latvia's experience in devising job descriptions.

  • assistance related to communication between state institutions and the public

In view of the current pace of development of the civil society in Georgia and the relatively low degree of knowledge about involvement in public administration work in defining and implementation of decisions, and the development of operational principles and standards in state institutions, Latvia can assist this sector by contributing its experience and practice to communication between the state and the public.

This activity is related to both public administration reform and development of civil society, as the process should be reciprocal. Latvia has already developed a communications strategy with the public and has incorporated in its laws and regulations the principles of harmonising opinions with the third sector, t.i., .– public organisations, including professional, and the principles of informing the public of the decisions passed. Latvia has considerable experience in developing communication mechanisms, organising public meetings and introducing stable tools for disseminating information, including development of internet websites, appointing a person responsible for communication in each institution, coordinating of the most important communication campaigns between the respective institutions, writing letters to the population, and replies to these, etc.

  • assistance in judicial matters

To ensure the development of efficient public governance in Georgia, the rule of law should be strengthened. To facilitate this, a Latvian expert is already participating in the European Commission's EU THEMIS mission. A visit of Georgian representatives to Latvia has taken place, to be followed by an exchange visit of a Latvian delegation.

Georgia is currently implementing reform of the penitentiary system, actively assisted by its Estonian counterparts. The Strategy section regarding project implementation mechanisms deals with potential cooperation between the Baltic States in this respect.

The information acquired through consultations and descriptions by the Latvian and Georgian parties suggests common qualities that need to be considered when implementing further development assistance projects. Assistance contributing to Georgia's public governance has been provided and may continue successfully through the following practical activities:

    • joint seminars, conferences and discussions, in which Latvia participates with its expertise;
    • practical introductory visits to various Latvian institutions, including long-term in-service training;
    • practical assistance by Latvian experts in resolving various issues, such as drafting and coordination of legislation, where the experts are well aware of the situation in Georgia and may help draft the relevant laws, positions and sectoral policy documents in conjunction with their Georgian counterparts.

COOPERATION RELATED TO THE DEVELOPMENT OF DEMOCRATIC SOCIETY AND CIVIL SOCIETY

Development of civil society in Georgia is facilitated through the third sector. Cooperation with Latvia's third sector implemented by activities undertaken under the LPDC is in its first phase that can be characterised as successful. LPDC incorporates 23 public organisations in Latvia, and its main objective is to pass on its experience and practices. Georgia has expressed its desire to learn from and acquire Latvia's experience in this respect.

Based on Georgia's needs and Latvia's expertise, the Latvian-Georgian cooperation on the development of the public sector comprises the following issues:

  • Strengthening of public sector awareness in Georgia's public space, including policy drafting. This activity could be facilitated together with sharing Latvia's experience in improving the overall action policy drafting process. To date bilateral relations have been established between non-governmental organisations and state institutions, but no stable cooperation principles have been defined yet.
  • Transfer of cooperation experience among public organisations – formation of associations, and representations, mutual cooperation and representation of interests in various institutions and regions (It is possibly worthwhile establishing cooperation among Latvian and Georgian regional non-governmental organisations).
  • Strengthening of cooperation between public organisations and state institutions, and improving communication.
  • Development of cooperation between public organisations and entrepreneurial sector – drafting and passing of legislation, and introduction of an appropriate tax system for this area of cooperation to implement cooperation between non-governmental organisations and entrepreneurs.
  • Research work - to provide the basis for development of the NGO sector. Exchange of methodologies for implementation of various types of research work and utilisation of results thus achieved, to identify the development status of the NGO sector and civil society, and to ensure further development of the sector and sectoral NGOs. It is of great importance to Georgia to share in international experience and learn more about involvement of the public in the civil society development activities.
  • Development of strategic planning skills of NGO representatives, and the promotion of target-oriented action in the activities implement in the public policy;
  • Development of a dialogue on the discussion culture among various social groups;
  • Increasing public awareness of development of the state; development of civil education;
  • Promotion of projects to facilitate public participation in development of culture and voluntary work;
  • Strengthening of the work of NGOs and exchange of experience in Georgia's priority areas as follows:
    • Youth NGOs;
    • Social security NGOs;
    • Minority and human rights protection NGOs.

The cooperation sectors of the Latvian and Georgian public organisations laid down in the second half of 2005 are the educational sector, social sector and integration into the EU and NATO.

The main issues in the educational sector was are:

  • Bilingual education;
  • Education of adults;
  • Life-long education.

Cooperation in the social area targets the following issues:

  • The Partridge model in the social system;
  • Support to groups with special needs and socially disadvantaged persons;
  • Eradication of HIV/AIDS and support to the ill;
  • Reproductive health.

Regarding integration into the EU and NATO, the main issues are:

  • Exchange of information among the law-making and implementing institutions and civil society;
  • Mechanisms to enhance participation of the civil society – legislative framework and the formal mechanisms applicable at the local, national and international levels.

In view of the multinational population structure of both countries and Latvia's position on development cooperation, Georgia is interested in learning in more detail of Latvia's experience in working with its minorities so as to successfully implement similar policies in Georgia. The Latvian Secretariat of the Special Assignments Minister for Social Integration and the Georgian Office of the State Ministry for Civil Integration Issues plan to enter into a cooperation agreement in this regard.

In view of the large number of people who have emigrated from Georgia over the recent period, the issue of special state support to Georgians living abroad (representatives of the Diaspora) has become more urgent.

Likewise, the human rights issue is topical, including both the observance of the rights and incorporating relevant norms into the legislation.

* Work on the draft law on religion is to begin in the near future, representing yet another area where Latvia's experience could be of value. Latvia's approach to human rights issues, the experience legislating and implementing the above will be of great importance to Georgia, where, as stated, the observation of human rights is a challenging issue.

Strengthening of civil society in Georgia can only be implemented by uniting members of all nationalities living in Georgia, and promoting their loyalty to the country and its governance system. Accordingly, Georgia, like Latvia, needs to introduce bilingual education methodology in its schools. Currently, a Latvian expert is participating in the OSCE project, assisting in developing methodology and study materials. Visits to Latvia by various government officials have also taken place in this regard.

COOPERATION IN THE ERADICATION OF POVERTY IN GEORGIA

Georgia is interested in sharing in the available experience in dealing with the massive issue of poverty. Latvia is willing to share its experience in implementing the social security reform and developing social services, including the drafting of legislation, establishment of the system, and distribution of responsibilities among various institutions, implementation of pension reform, organisation of work with socially disadvantaged groups, and preventive measures taken to reduce the number of disabled persons. In identifying socially disadvantaged groups in Georgia needing assistance, the traditions and culture of its various nations should be taken into account. When introducing assistance projects, there should be a clear understanding as to what kind of assistance is acceptable to the population, and what kind of aid is not required.

With regard to health there are two pending issues:

  • Reduction of the incidence of infectious diseases;
  • Improved health of the population – popularising a healthy lifestyle, and reducing the number of smokers.

On the health issue, Latvia has organised various training courses for Georgian doctors and nurses on treating tuberculosis sufferers as outpatients. .

A general overview of the educational and social sector shows that the number of potential cooperation issues is quite high and diverse, at the same time quite specific as to the type of assistance required. The Latvia-Georgia cooperation target areas may become more clearly defined with the Latvian and Georgian Ministries of Education and Science agreeing on main areas of cooperation in the future, though such discussions have not occurred yet. The present Strategy document therefore predominantly includes the wishes of the Georgian side. The same applies to cooperation between the Latvian Ministries of Welfare and Health and Georgian's Ministry of Labour, Health and Social Protection.

At the same time, cooperation talks have commenced between the Latvian and Georgian public organisations representing the various relevant sectors. This has a doubly positive significance, as representatives of both the policy makers and implementers and the civil society can participate jointly in developing and implementing the most appropriate policy models.

With regard to education, the Georgian side is interested in sharing in Latvia's experience regarding the implementation of life-long education. As the Georgian educational system increasingly necessitates allocation of finances for implementation of specific objectives within specific timeframes through project implementation, there is considerable interest in Latvia's practices in dealing with project tenders and due procedures, such as the operation of the Social Integration Foundation. Student exchanges should be encouraged, to further facilitate cooperation, and the idea is supported by the Ministries of Education and Science of both countries.

COOPERATION RELATED TO ECONOMIC DEVELOPMENT

A successful transition period experience for Latvia has been a dialogue with the Foreign Investors' Council (FIC) concerning development of methodology and resolving pending problems. The development of the domestic market and its coordination, and resolving of external trade issues have been equally successful. Experience that Latvia could pass on over a period longer than the next three years, would be its experience in establishing and ensuring the operation of the public services regulator.

The agricultural sector is an extremely important sector in Georgia (involving more than 50% of the employed population, 20% of the national economy), and as such it is of considerable significance in terms of cooperation with the international donors. The required cooperation with Latvia has been identified in the following areas:

  • Development of agricultural policy;
  • Development of food product standards (e.g., wine standards);
  • Organization of the rural support service;
  • Sharing experience with Georgian farmers and agricultural specialists regarding the forms of cooperation among Latvian farmers. Pass on experience in maintaining a dialogue with the state, and representation of the farmers' interests;
  • Sharing experience in laboratory work;
  • Development of the fisheries industry.

6. PROJECT IMPLEMENTATION MECHANISMS

To implement development cooperation successfully, an efficient project implementation and coordination mechanism should be developed.

In the near future the Latvian Ministry of Foreign Affairs will have access to an expert database. It is important to include in the database experts with experience in developing and implementing various reforms specifically during the transitional period. Such persons should be entered into the database even though they may have moved office, obtaining the data through Personnel Departments and heads of structural units of the respective institutions.

It is important for Latvia as a new donor state to develop a network of experts. The experts may thus share in experience transfer methodology and consultations. This kind of training programmes might provide practical advice as to presentation skills, inter-cultural communication and other issues, to build up stable teams, facilitate information exchanges among the various experts, and sharing best practices and information on difficulties encountered. The experts could meet annually in a forum, which would provide a good platform for professional discussions and attraction of new experts.

After the plan of specific projects is completed, it should be coordinated with the parties involved from both countries, as well as with the third sector. Mutual agreement is extremely important in terms of coordination of interests. Such coordination may take place in Latvia. To avoid duplication of projects, detailed descriptions of projects should be coordinated with the relevant assistance recipient institutions in Georgia. This process could be coordinated with assistance from the Latvian Embassy in Georgia in accordance with the previously agreed project development and management scheme. Embassy staff, being resident in Georgia, are better placed to monitor the ongoing reforms and activities. Likewise, the embassy has all information on Latvia's expertise in the relevant areas, allowing it to react rapidly to Georgia's needs, proved the Latvian financial resource management mechanism allows for such action.

Coordinating meetings for strategic discussions regarding development cooperation with the relevant officials from sectoral ministries and the Ministry of Foreign Affairs are already being held under the auspices of the Consultative Council in Development Cooperation Issues. It would also be important to hold discussions regarding further cooperation plans between the three Baltic States, when necessary, which would allow uniting the strengths and advantages of the region and communicating them jointly to the Georgian government and other international donors. With the opening of the Latvian Embassy to Georgia, it is of great importance to Latvian representatives to introduce themselves as being from a donor state also during informal coordinating meetings of the international donors, which are held monthly and organised by the UNDP, World Bank or USAID (United States Agency for International Development).

Since Latvia's participation in the assistance projects can be best and most effectively implemented by personnel with the transition period experience who may therefore have a better understanding of Georgia's situation than the major donors, it would be vital for Latvia to appropriately position itself at such informal meetings of the international donors and participate in them actively.

To sum up, it can be seen that practical assistance and project implementation mechanisms are identical for many sectors, and as such may be classified as follows:

  • Organisation of training for Georgia;
  • Practical introduction to Latvia's experience through visits to relevant Latvian institutions;
  • Practical assistance in development or implementation of specific policies, including legislation, policy documents and development of a monitoring system, with Latvian experts participating in the process.

Although the mechanisms applied to the various sectors are similar, each project should nevertheless be implemented by clearly defining specific issues to be dealt with in a specific sector, with particular reference to the joint development of documents for Georgia's needs.

To coordinate the process Latvia's expertise transfer and avoid difficulties that may result from communication problems, it is important to establish a consolidated network of various experts. Such a network would facilitate the exchange of information and agreement on the most efficient ways of passing on relevant information. In view of the difficulties that representatives of various Latvian institutions have voiced regarding communication with their Georgian counterparts, it could be worthwhile appointing two officials of different levels for the time of project implementation. If institutional changes or replacement of staff occur, the Latvian side should be advised accordingly. In such a situation the Latvian embassy, being located in Tbilisi, could assist in tracing back the 'lost' contacts. Technical difficulties are very likely to occur due to the instability of electronic communications in Georgia.

  • When implementing cooperation projects, the following cooperation and communications mechanism can be considered. After Latvia has identified its comparative advantages and Georgia declared its needs, the Latvian Embassy in Georgia, via the Georgian Ministry of Foreign Affairs, could initiate the potential institutional cooperation proposals by issuing invitations, organising seminars etc.
  • When developing and managing projects, consultations with the third sector should be conducted.
  • As it is planned to develop scientific research within the framework of Latvia's development cooperation policy, exchange of students between both countries, as well as research work on each country and their relations should be promoted. Such academic research work can later be used as the basis for the development of further projects, facilitating cooperation among specific institutions, such as educational establishments, research institutes and public organisations.

It could be worthwhile selecting an organisation (one in the state sector and one in the public sector) that would cooperate with the relevant Georgian institutions and consult on the prospects for attracting financing for small-size information exchange and research projects. The Latvian side has opportunities of attracting? EU finances, with funding being more readily available if it is for assistance to developing countries. It is important to advise the parties involved of where to seek required information and funds, together with relevant procedures. If required, relevant seminars for interested parties could be organised as part of cooperation, as well as joint publications developed, Internet forums organised, etc.

Strategy prepared by:

Sintija Šmite

Mobile: +371 9586680

E-mail: This email address is being protected from spambots. You need JavaScript enabled to view it.

LIST OF DOCUMENTS REFERRED TO

Latvian development co-operation policy documents

  1. The Basic Principles of Development Cooperation of the Republic of Latvia; approved by Cabinet of Ministers Order No. 1007 of 19.02.2003
  2. Development Cooperation Policy Programme of the Republic of Latvia 2006-2010
  3. Development Cooperation Policy Plan of the Republic of Latvia for 2005
  4. Development Cooperation Policy Plan of the Republic of Latvia for 2006.

Georgia's development strategy documents

  1. Country Strategy Paper 2003-2006 Tacis National Indicative Programme 2004-2006 Georgia adopted by the EC on 23.September 2003
  2. The Government's Strategic Vision and Urgent Financing Priorities for Georgia in 2004-2006.
  3. Economic Development and Poverty Reduction Program, Government of Georgia, Tbilisi 2003.
  4. Progress Report "Economic Development and Poverty Reduction Program" Tbilisi, January 2005.
  5. Common Country Assessment "Georgia", UN 2004.
  6. Memorandum of the President of the International Development Association and the International Finance Corporation to the Executive Directors on a Country Assistance Strategy for Georgia, November 2003.
  7. The Priorities proposed by the Government of Georgia for the European Neighbourhood Policy Action Plan within the European Neighbourhood Policy, approved by #291 Decree of the Government of Georgia, July 11, 2005.
  8. Georgia's Commitment under the Individual Partnership Action Plan (IPAP) with NATO – 2004-2006.
  9. Millennium Development Goals

Documents drafted by the international donors contributing to Georgia

  1. UNITED NATIONS DEVELOPMENT ASSISTANCE FRAMEWORK (UNDAF) GEORGIA 2006-2010
  2. UNDP- Poverty Mapping in Georgia, Georgia 2003
  3. National Human Development Report Georgia, 2000, UNDP Georgia.
  4. National Human Development Report Georgia, 2002, UNDP Georgia
  5. Canadian International Development Agency, Country Development Programming Framework- Georgia. 5 September 2003
  6. USAID/CAUCASUS- Georgia Country Strategy 2004-2008, August 7, 2003
  7. "Georgian Economic Trends" Georgian- European Policy and Legal Advice Centre, Quarterly Review No.2, 2005.

[1] Approved by Cabinet of Ministers Order No. 107 of 19.02.2003

[2] The Development Cooperation Policy Programme of the Republic of Latvia for 2006 -2010

[3] The summary for 2005 provided by the Economic Relations and Development Cooperation Policy Directorate of the Ministry of Foreign Affairs

[4] Approved by Cabinet of Ministers Order No. 107 of 19.02.2003

[5] The Development Cooperation Policy Programme of the Republic of Latvia 2006 -2010, Page 16

[6] Country Strategy Paper 2003-2006 Tacis National Indicative Programme 2004-2006 Georgia, Page 7.

[7] The Government's Strategic Vision and Urgent Financing Priorities for Georgia in 2004-2006, Page 12

[8] 2002 (census), www.cia.gov

[9] Canadian International Development Agency, Country Development Programming Framework- Georgia. 5 Sept 2003, 2003. Page 12

[10] Country Strategy Paper 2003-2006 Tacis National Indicative Programme 2004-2006 Georgia adopted by the EC on 23 September 2003.

[11] Economic Development and Poverty Reduction Program, Government of Georgia , Tbilisi 2003, Page 5

[12] Economic Development and Poverty Reduction Program, Government of Georgia, Tbilisi 2003, Page 6

[13] Progress Report "Economic Development and Poverty Reduction Program" Tbilisi, January 2005, Page 4

[14] Common Country Assessment "Georgia", UN 2004. Page 12

[15] Common Country Assessment "Georgia", UN 2004. Page 12

[16] Progress Report "Economic Development and Poverty Reduction Program" Tbilisi, January 2005, Page 9

[17] "Economic Development and Poverty Reduction Program" Tbilisi 2003, Page 10-12

[18] Progress Report "Economic Development and Poverty Reduction Program" Tbilisi, January 2005, Page 7

[19] Progress Report "Economic Development and Poverty Reduction Program" Tbilisi, January 2005, Page 4

[20] Common Country Assessment Georgia, 2004, UN Page 8

[21] "Economic Development and Poverty Reduction Program" Tbilisi, 2003, Page 14-15.

[22] Progress Report "Economic Development and Poverty Reduction Program" Tbilisi, January 2005, Page 20

[23] Common Country Assessment Georgia, 2004, UN Page 8

[24] The Government's Strategic Vision and Urgent Financing Priorities in 2004 -2006, Page 8

[25] The Government's Strategic Vision and Urgent Financing Priorities in 2004 -2006, Page 5-6

[26] The Government's Strategic Vision and Urgent Financing Priorities in 2004-2006, Page 34

[27] "Economic Development and Poverty Reduction Program" Tbilisi, June 2003, Page 87

[28] Memorandum of the President of International Development Association and the International Finance Corporation to the Executive Directors on a Country Assistance Strategy for Georgia, November 2003; Page 20

[29] Economic Development and Poverty Reduction Program" Tbilisi, June 2003, Page 86-90