International Lenders Permit Georgia to Limit Release

1 December 2008

of Information; Groups Protest Lack of Transparency

Transparency was a casualty when international donors gathered recently to consider emergency aid to Georgia.

Civil society groups requested disclosure of the primary document to be discussed at the multi-donor conference — the “Joint Needs Assessment.”

On the day before the meeting, a summary was released by the sponsors, including the World Bank, the European Commission and the United Nations Development Programme.

But the document released was a substantially shorter and much edited version of the complete report. A near complete version was later obtained unofficially by one of the concerned groups, Transparency International Georgia.

The restrictions on the release of information came from the government of Georgia, which considered some of the information to be sensitive, according to officials from donor groups interviewed by The World Bank and UNDP acceded to the government’s wishes.

The version issued by the World Bank runs 46 pages while the complete report contains 220 pages, including annexes. The report was prepared by the World Bank in cooperation with the UNDP, the EC, and other donors.

Dropped from the publicly released version were projections about future unemployment. World Bank officials indicated that the Georgian government wanted to protect assessments of the banking sector, and that information was still excised from the longer version, according to TI Georgia, which has released a report on the donor conference.

Disclosure Decisions Ceded to Georgia

Inquiries by indicate that neither the World Bank nor the UNDP have standard procedures for disclosure of documents for such donor conferences, held occasionally to coordinate activities for countries in crisis.

The UNDP told in a statement, “The final JNA document was submitted to the Government of Georgia which took the principal decisions on its further use and disclosure.”

World Bank officials said they acceded to Georgian government concerns about disclosure of information about the banking sector. Although such deference to national concerns apparently is traditional, officials indicated that there is no set policy on disclosure of JNAs.

TI Georgia Sought Earlier Release

Transparency International Georgia and other Georgian groups Oct. 21 criticized “a lack of transparency and local consultation ahead of a one-day conference on 22 October, where decisions on hundreds of millions of dollars of international aid to Georgia will be made.”

The conference resulted in pledges of about $4.5 billion in aid from 30 countries and 15 international organizations.

In advance of the one-day conference, TI Georgia and others asked the UNDP, the EC and the World Bank for the Joint Needs Assessment, according to Tamuna Karosanidze, executive director of TI Georgia. “Their responses were that the document had restricted distribution to participants of the conference at the request of the Georgian government.” However, a two-page summary providing a general overview was released four days before the conference, held in Brussels.

Then, on the day before the conference, a 46-page version of the assessment was released to journalists and others.

About two weeks earlier, on Oct. 9, the full report had been sent to donors planning to participate in the conference, according to a World Bank official. The official indicated that the publicly released version was edited because Georgian authorities had some sensitivities about the release of the initial document, particularly regarding the assessment of the banking sector. The Bank official said he is not aware of any rulebook for transparency around donor conferences.

The JNA estimated that Georgia will require $3.25 billion (€2.38 billion) over the next three years in budget support, social sector support and infrastructure development. “This is more than Georgia’s government plans to spend in 2009, and the equivalent of nearly one thousand dollars for every person living in the country,” TI Georgia said.

Karosanidze in a press release also said, “Aid given behind closed doors lacks accountability, to the taxpayers of donor nations as much as to the citizens of Georgia. The lack of transparency in giving this aid makes it less likely that money will reach those most in need. If donors want aid to support Georgia’s development, they must ensure that this aid is transparent and democratically accountable.”

“Allocating these huge sums behind closed doors on the basis of a secret document does not set a good example for Georgian democracy to follow,” continued Karosanidze. “If Georgia’s citizens can have no say in how this money will be spent, democracy in Georgia will be weakened rather than strengthened. Aid will only be received positively in Georgia if Georgian citizens are confident that it will be well spent, which is something that only wide-spread civic involvement and transparency can achieve.”

TI Georgia complained that consultations in September to set the stage for the conference did not involve local civic organizations or the Georgian parliament.

The assessment was led by the World Bank and carried out from Sept. 8-21, in response to a request from the Georgian government to identify priority areas and financial requirements needed for post-conflict recovery and reconstruction. “The team from partnering international institutions will assess the most pressing needs in areas such as infrastructure, environment, agriculture, housing, business environment, and the social needs of the internally displaced population and others affected by the crisis, ” according to a World Bank description.

Further, TI Georgia objected that the aid conference itself took place behind closed doors. “Despite repeated requests, no Georgian representatives apart from the government’s small team, and no independent international observers, will be allowed to follow conference proceedings,” the press release stated.

More Detail in Undisclosed Full Report

The “summary” originally released, according to a TI Georgia’s report, “contains heavily edited paragraphs and omits key figures (such as unemployment projections) and sections (such as the annex on “economic, social and poverty impact”), whose exclusion from the public domain is irreconcilable with the concept of liberal democracy.”

TI Georgia’s summation of the complete report indicates that one of the deleted elements is an estimate that up to 100,000 Georgians are expected to lose their jobs in the near future. Between now and 2010, poverty levels are projected to rise from 23.6% to 25.9%, and those already poor may slide even deeper into poverty, the report said.

TI Georgia also highlighted a potentially controversial feature of the publicly released summary that it said was ignored by journalists, who also got that version on Oct. 21.

TI Georgia wrote: “The most dramatic revelation in the JNA is that the government now plans to permanently resettle all internally displaced persons (IDPs) in Georgia, including those displaced in the early 1990s, at a total cost of 796 million dollars. It is a sad comment on the quality of the Georgian media and on the opposition that neither group seems to have taken much notice of this radical departure from pre-war policy, despite the fact that it is plainly stated in the public version of the JNA, involves large sums of money, and will directly affect eight percent of the Georgian population.”

Noting that the JNA quotes selectively from the Paris Declaration on aid effectiveness, the TI Georgia report comments, “What the JNA fails to mention is that the Paris Declaration also calls for aid to be given in a manner that is inclusive, accountable and transparent.”

TI Georgia adds: “The JNA was drawn up and revised in a manner that completely excluded the Georgian parliament, political parties, think tanks, advocacy groups and the media from the formulation of development strategies for Georgia. The continued secrecy of the JNA prevents parliament and civic groups from effectively participating in debates on how aid should be allocated, implemented and monitored.”

Further, the report states, “The JNA does not contain any freedom of information provisions compelling donors, governmental bodies, private contractors or non-governmental grant recipients to open their books to public scrutiny. While aid channeled through the state budget will be subject to Georgian legislation (in particular the Administrative Code) that details rights of access to information, aid funneled through other channels may remain insulated from such accountability safeguards.”

By Toby McIntosh
(November 2008)

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Filed under: IFTI Watch


In this column, Washington, D.C.-based journalist Toby J. McIntosh reports on the latest developments in information disclosure in International Financial and Trade Institutions (IFTI).
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