Georgia Adopts a Law on the Development of Mountainous Regions

Published in Economics
Saturday, 01 August 2015 12:43

Targeted, poverty reducing benefits for people living in the highlands of Georgia, as well as incentives for businesses and budget support to economic and social development are envisioned in a newly adopted Law on the Development of Mountainous Regions, which comes into force today, 31 July 2015.

The draft law adopted by the Parliament of Georgia last week was prepared by the Government of Georgia with the leadership of the Ministry of Regional Development and Infrastructure, and support from the Swiss Cooperation Office for the South Caucasus, Austrian Development Cooperation and the United Nations Development Programme (UNDP).  

“The new Law establishes objective criteria for classifying mountainous areas and settlements. It provides important and substantial social, economic and business benefits, together with a guarantee of annual funds from the national budget reserved for mountain development,” said Tengiz Shergelashvili, Deputy Minister of Regional Development and Infrastructure of Georgia.

The benefits described in the new Law include: tax exemptions for selected companies operating in the mountainous areas; improved social benefits for local residents; higher salaries for teachers and medical staff; and increased social assistance for pensioners. In addition, more opportunities and support will be available for infrastructure and business development in the highlands.

The funds will be provided from the national budget through the specially designed Mountainous Areas Development Fund. The selection of mountainous settlements that qualify for privileges and support will be undertaken by a National Council on Mountainous Regions to be formed under the auspices of the Prime Minister of Georgia. Based on criteria specified in the Law, the Council will propose a list of mountainous settlements and present it to the Government for approval.  

‘Drawing on international experience, the new Law presents an important opportunity to help reduce poverty and improve the quality of life in the mountainous areas through enhanced human and economic development,” said Shombi Sharp, Deputy Head of UNDP in Georgia.

With funds from the Swiss Cooperation Office for the South Caucasus and Austrian Development Cooperation, UNDP has provided expert support to preparing a draft Law on Development of Mountainous Regions of Georgia and facilitated cooperation of the Government and Parliament of Georgia with the two highland countries – Austria and Switzerland, whose governments are actively supporting regional development in Georgia.  

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