Publication: Georgia - Managing Expenditure Pressures for Sustainability and Growth : Public Expenditure Review
Date
2012-11
ISSN
Published
2012-11
Author(s)
World Bank
Abstract
Economic growth has rebounded strongly
in Georgia during 2010-12 and commendable fiscal
consolidation has been implemented, although considerable
medium-term macro-fiscal challenges remain. To meet the
challenge of generating rapid and sustainable growth in an
uncertain global environment, Georgia will need to continue
to implement and potentially deepen its fiscal consolidation
program. This public expenditure review (PER) considers
possible sources of expenditure pressure that could
undermine the fiscal consolidation program and suggests
options to manage them. Social expenditure pressures arise
from the need to provide adequate old-age income to an aging
population that relies primarily on the publicly funded
pension benefit, as well as from needs to improve social
assistance coverage of the poor, and improve health
outcomes. Capital expenditure pressures arise from the need
to rehabilitate a large backlog of the secondary and local
road network in poor condition, continued improvement the
East-West Highway, and from new investment needs in energy,
water, agriculture, and regional development. The PER
presents a number of options for consideration to manage
fiscal consolidation, which can contribute toward greater
selectivity in capital expenditures, enhanced sustainability
of the road investment program, and containing medium-term
social expenditure pressures. The specific policy options
discussed above could collectively curtail expenditure
pressures estimated at about 2.8 percent of GDP by 2015,
thus enabling Georgia to meet its fiscal consolidation targets.
Citation
“World Bank. 2012. Georgia - Managing Expenditure Pressures for Sustainability and Growth : Public Expenditure Review. Public expenditure review (PER);. © Washington, DC. http://openknowledge.worldbank.org/entities/publication/9940b628-ef24-519b-bf50-71733523e240 License: CC BY 3.0 IGO.”