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Georgia: Donors Conference Wins $1 Billion In Pledges

  • Ahto Lobjakas

Brussels, 17 June 2004 (RFE/RL) -- An international donors conference for Georgia has resulted in pledges totaling about $1 billion.

One of the organizers of the event, World Bank Regional Vice President Shigeo Katsu, said last night the result had exceeded all expectations.

"The result is that we have been able to receive pledges in the order approximately of $1 billion, or approximately 850
million euros, for the period 2004-06," he said. "This by far exceeds the expectations going into the meeting so it has been, from that point of view, already a very successful pledging day."

The result is twice as much as the Georgian government had indicated it expected.

The biggest contributor was the United States with approximately $360 million -- $53 million of which is for "security assistance" in 2004. A statement released by the U.S. delegation said Washington will also make available direct budget support for the paying of salaries. Job creation schemes, technical assistance to the energy sector, and assistance to Georgia's farmers were also highlighted.
"We also all know that given the recent troubled history of Georgia,... issues such as governance, corruption, public-sector management capabilities, barriers to private sector development, the whole social development agenda, infrastructure, and so on, are huge challenges." -- World Bank Regional Vice President Shigeo Katsu


The U.S. statement urged Georgia's authorities to maintain "absolute transparency" in fighting corruption, adding that following "due process" is essential for legitimacy.

The European Commission pledged $125 million, with individual member states adding more. Part of the EU money is earmarked for rehabilitation measures in conflict zones in the separatist provinces of Abkhazia and South Ossetia.

Katsu said the goodwill of international donors reflects "the pretty good track record," as well as the vision of the
six-month-old administration of President Mikheil Saakashvili. He said there had been unanimous support among the donors to the government's reform program.

Katsu said the donors had also thoroughly discussed the manifold challenges facing Georgia.

"We also all know that given the recent troubled history of Georgia,... issues such as governance, corruption, public-sector management capabilities, barriers to private sector development, the whole social development agenda, infrastructure, and so on, are huge challenges, as are also the development of a viable judicial system on the one hand, checks and balances, the rule of law and, above all, also the development of a civil society that is able to participate in decision-making."

The Georgian government had asked donors to contribute to projects ranging from public administration reform and downsizing law-enforcement bodies to infrastructure upgrades and energy-sector rehabilitation.

Part of the money will go towards direct budget support to help the Georgian state pay salaries and pensions.

Katsu said there was an understanding between the donors and the Georgian authorities that the pledged money would be spent in a transparent fashion.

"There has been unanimous understanding, when we talked about this partnership, an understanding between the Georgian authorities and the donor community that accountability matters, the effective use of every dollar or euro spent matters, and that we wanted to set up a good tracking mechanism, monitoring and evaluation system so that indeed all these funds will lead to poverty reduction on the ground," Katsu said.

Russia was among the 31 countries present at the donors conference.

Officials indicated Russia had not made any direct pledges, but had agreed to reschedule Georgia's debt burden.
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