WASHINGTON, June 27, 2013 – The World Bank Board of Executive Directors today approved a US$60 million Competitiveness and Growth Development Policy Operation (CG DPO) for Georgia. This is the second in a three-year DPO program designed to support competitiveness and inclusive growth. The DPO program is a central component of the World Bank’s Country Partnership Strategy (CPS) for Georgia covering the period 2010 – 2013. The first CG DPO was approved on July 19, 2012.
The second CG DPO is intended to support the Government of Georgia’s medium-term reform program for competitiveness and inclusive growth. The main policy areas covered under three pillars are: (i) competitiveness; (ii) public financial management; and (iii) effectiveness of social spending.
Actions under the competitiveness pillar include reforms of trade policy and trade facilitation, education and its human resource management, and the investment climate in the power sector, all of which will lead to higher investment, exports, and more jobs.
The second pillar, improved effectiveness of public financial management, includes measures to help increase transparency and coverage of financial reporting as well as the phased implementation of international accounting standards.
The third pillar, effectiveness of social spending, includes actions to improve quality and access to health services. Other reforms intend to improve the efficiency of the medical insurance plan and the targeted social assistance by lowering transactions costs to beneficiaries.
“This second Development Policy Operation is designed to support the core objectives of the government’s program, which prioritizes external competitiveness, job growth, and poverty reduction,” said Henry G. Kerali, World Bank Regional Director for the South Caucasus. “Strong government ownership of the program will ensure implementation and sustainability of the DPO program supported by the Bank.”
“The strategy adopted by the government is to promote a virtuous cycle of productivity improvements, higher investment, and exports to generate growth and employment while strengthening social safety nets and maintaining a stable macroeconomic environment,” said Rashmi Shankar, World Bank Lead Economist for the South Caucasus and Task Team Leader of the Georgia DPO program.
The CG DPO series are IDA blend credits with a maturity of 25 years, including a 5-year grace period.
World Bank commitments to Georgia total approximately US$1.92 billion.