| Project Detail |
Armenia, Azerbaijan and Georgia have introduced wide-ranging structural reforms aimed at improving the legal and regulatory framework for the private sector as part of a market-based economy. The World Bank’s annual Doing Business report reflects these developments, with all three countries regularly being categorised in the top third of international rankings. Existing opportunities are not yet being maximised to their full potential, however. There is still significant potential for foreign trade and investment and for developing a skilled workforce in the South Caucasus. Planning and implementing a coherent economic and financial policy remains a challenge. Objective The planning and implementation of economic development processes in the South Caucasus region improves. Approach Efforts to successfully plan and implement economic and financial policies are supported by four interlinked programme components: Advice is provided to state ministries and agencies on specific aspects of economic and financial policy, in particular with regard to planning and analysing economic policy and improving competition policy. At the same time, the programme helps institutions involved in promoting investment to plan and steer measures to improve the investment climate. In doing so, it assists in establishing attractive, investment-related business services for international and domestic companies. The programme also provides advice to partner institutions on the removal of trade barriers and on efforts to meet important quality standards of importing countries. It supports specific direct measures to promote trade, e.g. joint presentations at trade/consumer fairs and participation in international forums for political dialogue. These steps help to promote closer economic cooperation between the region and neighbouring states (including the EU) and improve its competitiveness on international markets. The above measures to boost trade and investment are complemented by efforts to develop a skilled workforce in specific regions and sectors (e.g. food production and tourism) with a focus on the needs of the labour market. This involves bringing together and building the capacities of actors responsible at regional level (e.g. in employment forums) and drawing up and implementing programmes to improve skills and create jobs in line with labour market requirements. Results achieved so far Economic and financial policy With the help of the programme, the Armenian Government has drawn up a number of proposals for dealing with the impact of the global financial crisis on the economy, e.g. in the area of export promotion. Other measures to stimulate the economy were also initiated with a particular focus on developing a strategy for an export-oriented industrial policy. This strategy and others are taken into account in the planning of a results-based public sector budget in Armenia. The programme has also played a key role in the ongoing development of essential processes and criteria. Competition policy Armenia’s competition policy has become stronger and more effective as a result of advice on reforming competition law provided within the framework of the regional project Legal and Judicial Reform in the South Caucasus. For example, one case of unfair competition in the Armenian drinking water sector was identified and regulatory measures introduced to redress the situation. Another company was prevented from abusing its dominant position in the petrol market. In Georgia, measures have been supported to improve competition policy, consumer protection and effective market pricing. One such measure involves the Medical Activity Regulation Agency (MARA) verifying the authenticity of medicines before they can be launched on the wholesale or retail market. Quality standards and trade barriers In order to compete on international markets, products have to comply with quality standards, and trade barriers have to be removed. To this end, the programme has supported a number of partner institutions such as Georgia’s National Food Agency by building expertise and resources in the area of international food standards. State institutions can now offer private sector companies and training bodies food safety checks and provide advice on implementing international trading standards. This allows farmers, for example, to adapt their production and processing methods to the requirements of European consumers. The programme has also helped set up a new information centre in Azerbaijan to focus on technical trade barriers, with a view to meeting WTO requirements. Companies can use the centre to identify the most important standards in their target markets and adapt their products and services accordingly — a crucial step in the expansion of international trade relations. Foreign investment and trade Armenian, Azerbaijani and Georgian companies have held joint presentations at trade and consumer fairs, in line with professional standards. As well as making important new contacts with German and international companies, this opportunity to engage in dialogue and exchange views and experiences represents a major step towards promoting greater understanding between the countries of the South Caucasus region and towards conducting business with other countries more professionally. |
