Georgia: Technical Assistance Report-Public Investment Management Assessment
IMF Staff Country Reports, November 7, 2018
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Bibliographic details
- Published: November 7, 2018
- Series: IMF Staff Country Reports
- DOI: https://doi.org/10.5089/9781484383223.002
Summary
- The Government seeks to strengthen infrastructure governance by improving the public investment management (PIM) and public-private partnerships (PPPs) frameworks.
- The government has an ambitious public investment agenda to be implemented through traditional public investment and PPPs.
- Preserving fiscal sustainability in a context of limited fiscal space requires avoiding inefficiencies and managing fiscal costs and risks arising from infrastructure projects.
- Authorities are working on a broad range of public financial management reforms, including improving the PIM framework and the legal and regulatory framework for PPPs and PPAs.
- Over the last decade, public investment in Georgia has been similar to the average of emerging market economies (EMEs).
Public investment trends and key statistics
- Since the mid-2000s, public investment accounted, on average, for one third of total investment.
- Public investment remained volatile, reaching a peak of 8.6 percent of GDP in 2007.
- Public investment declined in the aftermath of large global and regional shocks.
- Public investment stabilized at about 5.5 percent of GDP in recent years.
Findings
- Strengthening PIM and PPP frameworks is timely and important given the ambitious investment agenda.
- Managing fiscal costs and risks from infrastructure projects is crucial to preserve fiscal sustainability with limited fiscal space.
- The authorities' ongoing public financial management reforms cover PIM improvements and legal/regulatory enhancements for PPPs and PPAs.
Policy implications and recommendations
- Prioritize reforms that reduce inefficiencies in project selection, appraisal, and implementation to contain fiscal risks.
- Enhance legal and regulatory frameworks for PPPs and PPAs to clarify fiscal implications and risk-sharing with private investors.
- Integrate PIM improvements into broader public financial management reforms to support the government’s investment agenda while safeguarding fiscal sustainability.
International Monetary Fund. Fiscal Affairs Dept. "Georgia: Technical Assistance Report-Public Investment Management Assessment", IMF Staff Country Reports 2018, 306 (2018).
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