Georgia-EU Innovative Action for Private Sector Competitiveness 

ObjectivesFund scope

Over the last 15 years, Georgia’s economic competitiveness has changed dramatically with the reduction of corruption. The facilitation of business development, opening a business and paying taxes is now simpler, cheaper and quicker, as is accessing local and international markets. Georgia has made alignment with the European Union an important part of its public policy reform, which has brought a strong West-facing agenda to all parts of its market reforms.  

In spite of efforts, however, the economic and social development of Georgia is hampered by low performance in innovation and business sophistication. The business start-up rate is a mere 8.6% and business-to-business cooperation is poor, resulting in a lack of cluster development. ‘Clusters’ are made up of businesses within a particular value-chain or geography and often coordinate their activities to share risks, improve technology, and reduce costs. This has caused a decreased provision of inputs and skills, downstream service development, product certification and quality control, export facilitation, transportation and logistics and international branding and marketing, all of which is problematic given Georgia’s ambition to expand its exports to the European Union and its highly sophisticated markets that require complex, consistent and high-quality products.  

The Innovative Action for Private Sector Competitiveness programme enhances entrepreneurship and business sophistication by strengthening the capacities of the government and local entities to develop and operate clusters. Stakeholders provide private sector support and entrepreneurship development on the packaging and seedling sectors, which offer the greatest opportunity for growth, cluster development, and have the potential for broader economic and social impact.  

Theory of Change 

The Joint Programme addresses the low levels of entrepreneurship, business skills, local production, poor diversification, and limited trade opportunities in the Georgian economy by: 

• Strengthening the capacities of policy-makers and other stakeholders to identify and develop clusters. 
• Piloting clusters in packing and seeds/seedlings sectors to enhance their value chains. 
• Providing strategic investments to companies/projects which are developing the clusters.  
• Engaging the Georgian diaspora in mainstreaming SME Development support. 

Funded initiatives use cluster development to help enhance inter-firm cooperation to overcome coordination externalities, improve technologies, and new market penetration. Moreover, in providing strategic investments to companies, the Joint Programme is helping them to overcome cluster bottlenecks in technology upgrade and innovation, and increase design input, certification, environmental standard uptake, and foreign market understanding and access

GovernanceGovernance arrangements

Steering Committee  

Co-chaired by the UN Resident Coordinator, designated authorities from the EU delegation and the Georgian Ministry of Economy and Sustainable Development (MoESD), the Steering Committee oversees and guides the overall direction and policy of the Joint Programme. It also ensures full national ownership, as well as the smooth and successful implementation of the Joint Program. The Steering Committee is also made up of the representatives from senior personnel of all the signatories to the Joint Programme Document.  

Joint Programme Coordination Team 

Is tasked with coordinating the planning and implementation of the Joint Programme, and is made up of the Program Officers of the participating UN Organizations. The  Team is also jointly responsible for identifying and fostering synergies across various project initiatives and promoting joint/consolidated impact. 

Participating UN Organizations   

Assume full programmatic and financial responsibility and accountability for the funds disbursed by the Administrative Agent. They must also establish a separate ledger account for the receipt and administration of the funds disbursed to it by the Administrative Agent. 

Administrative Agent 

Participating Organizations receive funds through the Administrative Agent, Multi-Partner Trust Fund (MPTF) Office. The Administrative Agent is responsible for the receipt, administration and management of contributions from donors, disbursement of funds to Participating Organizations, and consolidation and dissemination of progress reports to donors. 

Projects

Georgia-EU Innovative Action for Private Sector Competitiveness

Georgia-EU Innovative Action for Private Sector Competitiveness is currently supporting count_projects ongoing projectscount_globalInterregional and count_countries country-specific. This table shows the most recently approved ongoing projects.

All project financial information can be found in the Financials section, including delivery analysis by organization, theme and project; project financial status by country and by theme.

Georgia-EU Innovative Action for Private Sector Competitiveness

Results

The European Union-funded IPSC supports entrepreneurship and business development in Georgia. Initiatives promote the capacity development of policy-makers and other stakeholders to identify and develop clusters, establish a clustering approach in the packaging and seedlings sector, support strategic investments in companies developing clusters, and engage the diaspora community in business development. 

ContactsPoints of contact

Policy and Programme Issues

George Nanobashvili, Economic Development Team Leader, Email: George.nanobashvili@undp.org   

Fund Administrative Agent Issues

Olga Aleshina, Senior Portfolio Manager, Email: olga.aleshina@undp.org
Dawit Ghebremichael, Portfolio Associate, Email: dawit.ghebremichael@undp.org
Ramon Gatchalian, Finance Associate, Email: ramon.gatchalian@undp.org