2020 August-September Analysis

Covid-19 recovery, insolvency reform, creating a capital market: The USAID Economic Governance Program at work

0

When the five-year, USAID-funded Economic Governance Program started at the end of last year, its aim was clear: use strategic problem-solving methodology to address problems with the business climate and increase Georgia’s attractiveness for investors.

Then the pandemic struck. Instead of veering off course, the program buckled down and used its insight and methodology to help the Georgian government address the economic repercussions of the crisis.

Over the past several weeks, the program has worked closely with the government as ministers develop sectoral plans to help the economy recover in the post-pandemic period.

“In March, the Prime Minister’s Office requested technical assistance in developing the national economic recovery plan,” USAID/Georgia Mission Director Peter Wiebler noted in an editorial published on Civil.ge.

“We responded quickly, engaging an international team of experts to help develop plans for a rapid recovery that gets the Georgian people back to work and protects the economic gains that Georgia made before the pandemic. In our response, we’re supporting policies that put the private sector at the center of the economic recovery.”

In addition to bringing in international experts to work closely with the Georgian government on the recovery plan, the program helped create a platform for Georgian economic think-tanks to cooperate with the government on overcoming the economic crises caused by the Covid-19 pandemic.

The program has also continued working on its original mandate, using problem-solving methodology to assess processes that are creating bottlenecks for business and the economy, identify the main issues contributing to the problem, and engage influential public and private sector actors in the reform process.

To date, the program has used this methodology to support the Law on Investment Funds, which was adopted (in the second hearing) by the Georgian Parliament in June. The implementation of this law will significantly improve the country’s reputation on the international market as well as facilitate the development of the capital market in Georgia and attract portfolio investments.

Likewise, the program has worked closely with the public and private sectors to support the new law on insolvency, which is currently being discussed in Parliament. The draft law provides new, progressive guarantees to both businesses with debt and their creditors.

The program has also initiated reform of the tax disputes resolution system, working closely with the Ministry of Finance to develop a system that will streamline tax administration and facilitate business development.

In addition, the program supported the drafting of a new law on tourism and the creation of the Georgian Tourism Industry Alliance, which unites over 15 associations working in the tourism and hospitality sector of the country. The alliance will significantly improve the sector’s ability to speak with the government in a single voice and advocate for better policies to address its challenges following the pandemic.

The USAID Economic Governance Program is a five-year program implemented by Deloitte Consulting Overseas Projects that aims to help the private sector to increase its role in implementing economic reforms and attracting more investments.

The program will employ and strengthen:

  • The regulatory impact assessment (RIA)
  • The PPD platforms, such as the ReforMeter and the PPD Quality Tracking System
  • Economic Policy Advocacy Coalition (EPAC)

The USAID Economic Governance Program supports several business enabling reforms including:

  • Tax administration
  • Trade policy
  • Transport and Logistics
  • Insolvency
  • Capital Markets
  • Water Resources
  • Innovation
  • State Procurement
  • Competition
  • Tourism
____________________________ ADVERTISEMENT ____________________________