Billion Dollar Pledge
Transition Assistance to Georgia
Following Georgia's conflict with Russia in August 2008, the U.S. Government immediately responded to the emergency needs of conflict-affected populations and provided economic support to Georgia.
An international donors' conference for Georgia was held in Brussels on October 22, 2008. During the conference, the U.S. Government joined with leaders from the international community and multilateral organizations to affirm support for Georgia in the wake of the conflict. Former Director of U.S. Foreign Assistance and Former U.S. Agency for International Development (USAID) Administrator Henrietta Fore formally pledged $1 billion in U.S. assistance to support Georgia's economic recovery. Other international donors followed the U.S. lead and pledged $4.55 billion against the World Bank-led needs assessment target of $3.2 billion (Ministry of Finance).
The United States' $1 billion assistance package will help internally displaced persons, rebuild infrastructure, restore economic growth, sustain investor confidence in the Georgian economy, and foster continued democratic reform and energy security (Remarks by Henrietta H. Fore, Former Director of U.S. Foreign Assistance and Former USAID Administrator at the United States Mission to the European Union on USAID/Georgia website).
USAID is one of the several USG agencies implementing this plan. As of January 2009, USAID has provided $250 million in budget support, over 40 million in humanitarian assistance, and is currently identifying further support.
U.S. Government's $1 billion pledge:
The sudden and unplanned increase in government expenditures caused by the conflict created a need for budgetary support to the Georgian government. While in Brussels, Director Fore signed an agreement with Georgian Finance Minister Nikoloz Gilauri to provide $250 million in such support to the Georgian government. The $250 million grant funds Georgia's budget expenditures to cover state pensions, state compensation and state academic stipends ($163.3 million), health care costs for people living below the poverty line ($26.1 million), allowances to individuals displaced by the conflict in Abkhazia ($6.1 million), financial support to schools through a voucher system on a per-student basis ($24.2 million), and compensation and salaries for government employees of all ministries excluding the Ministry of Defense and Ministry of Interior ($30.3 million).
(Cash Transfer Grant Agreement - PDF, 390KB)
(Cash Transfer Grant Agreement Implementation Letters - ZIP, 6.9MB)
The U.S. Overseas Private Investment Corporation (OPIC) provided $176 million for financing seven new projects in Georgia, which will inject much-needed capital into the fledgling democracy's banking, construction and manufacturing sectors.
The Millennium Challenge Corporation provided an additional $100 million grant. The additional funding will focus on Georgia's road network, infrastructure development and energy activities.
$61.7 million was used for various humanitarian assistance activities, including airlifts of emergency relief supplies, managed by the Office of U.S. Foreign Disaster Assistance (OFDA) and other U.S. Agencies.
$50 million assistance will help people most directly affected by the conflict through the winter season. Assistance will be used for winter food; registration of IDP property; winter crops; livestock maintenance; community grants and school rehabilitation; vocational education; police support; disposal of unexploded ordinance; and provision of non-food winter supplies and direct improvements to winterize IDP shelters. (USAID News)
$53.3 assistance package, announced May 21, 2009, will be used to provide programming for conflict-related priority sectors including: good governance, civic participation, election and media reform; energy infrastructure and economic growth; health, education, and social services; border security, counter-terrorism and law enforcement reform; and humanitarian assistance. (U.S. Government Announces Release of $53.3 million Assistance to Georgia)
The U.S. Embassy announced the release of $50 million of assistance on October 8, 2009. The funds will be used for: school rehabilitation, reintegration assistance for recent internally displaced persons, municipal infrastructure development programs, Shida Kartli region recovery, employment and vocational training; survey and clearance of landmines and explosive remnants of war, and funding for the Georgian Coast Guard (U.S. Government Announces $50 million of Assistance to Georgia)
On February 5, 2010, Deputy Secretary of State James Steinberg visited Georgia. During his visit the Deputy Secretary announced the release of $242 million to assist the people of Georgia. The provision of these funds marks the fulfillment of the $1 billion pledge to assist Georgia following the August 2008 conflict.
(Completion of the $1 billion pledge)
(U.S. ASSISTANCE TO GEORGIA - $242 Million - FY 2009 Supplemental Funding)
During the past 17 years, the American people, through USAID, have invested about $1,5 billion in Georgia. USAID projects are designed to support Georgia's transition to a free and prosperous democracy. They include initiatives to quicken economic growth, develop democratic institutions, and improve health and education.
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