Promoting Good Financial Governance

Context

Since 2005, the German Federal Government has been supporting reforms to promote good governance in the South Caucasus – including with regard to public finances. These efforts are taking place within the framework of the following strategic documents:

• An Association Agreement with the European Union, which fosters close economic cooperation
• The Decentralisation Strategy 2020–2025, which is seeking to expand decentralised governance in Georgia
• The reform strategy that has been devised for the country's public financial management
• National action plans for implementing the United Nations’ 2030 Agenda for Sustainable Development

While Georgia has improved its ability to administer its public finances, it still faces a number of challenges. For example, the country’s communities are not yet adequately planning and implementing their budgets in resulted-oriented and gender-sensitive ways that involve their citizens in the process.

Objective

The eight pilot communities – Rustavi, Telavi, Keda, Akhaltsikhe, Khashuri, Kharagauli, Dusheti and Ozurgeti – plan and implement their financial budgets in a more results-oriented, gender-sensitive and democratic manner.

Approach

The project supports Georgia in optimising the legal and institutional framework conditions for good financial governance. It is also providing assistance to the country with improving the public financial administration of cities and smaller communities, including by enhancing the corresponding skills of public entities.

At the municipal level, the project is promoting a culture of decision-making that is more results-oriented, gender-sensitive and democratic. In addition, it is sharing experiences and proven practices from the pilot communities with Georgia's central government through regular meetings, consultations and studies so that good practices can be implemented more broadly. This in turn is supporting the process of financial decentralisation, which is part of Georgia's current efforts at decentralisation reform.

Last update: June 2023