From the ISET Economist Blog (https://www.iset.ge/blog/?p=3871)
By Eric Livny
Democracy and Freedom Watch reported October 9, that “Georgia’s controversial new immigration law may be changed”. The law, writes DFW, “has caused a wave of confusion and irritation in the country’s expat community. Prime Minister Irakli Gharibashvili … told journalists that if any defects become apparent after the enactment of the new law, ‘we’ll surely correct it.’”
Just a month earlier, confusion, irritation and public outrage were caused by another piece of Georgian legislation – a law greatly limiting the sales of non-prescription drugs (see Florian Biermann’s post). The outrage was caused by the fact that many of the drugs affected by the new law, e.g. plain painkillers, were in extremely wide use. As a result, less than two weeks after coming into force on September 11, the law was amended by the health minister, Davit Sergeenko, allowing 772 medicines to be sold over the counter, without a prescription.
One could perhaps say, as the Germans do, ende gut, alles gut. But, alles is nicht gut. The fact that such REALLY BIG MISTAKES are allowed to occur in the first place suggests that something is deeply flawed in the Georgian policymaking machine. One obvious concern is the lack of due “public policy” process. Indeed, there was nothing particularly urgent about either piece of legislation; both could have benefited from a proper technical review, “stakeholder consultations” and a public debate.
Second, and very importantly, these grand failures suggest that Georgian lawmakers lack a proper understanding as to the role of regulation in an economy, and how much of it a country like Georgia needs (or can afford).
THE BENEFITS OF PROCRASTINATION AND DEBATE
Any discussion of regulations can easily get politicized, sparking seemingly futile and lengthy political exchanges. Left-wing intellectuals would argue that regulations are there to address market failures (such as drug addiction and overconsumption of antibiotics) or protect the weak and vulnerable (e.g. by securing their jobs and providing income support). The libertarians among us would argue that the market can correct itself, and that, in any case, state paternalism is not a solution to any problem. Rather, it creates unnecessary red tape and leads to unintended consequences such as laziness, corruption, illicit economic activities (“black market”) and smuggling. State failures, according to the enlightened libertarian view, are as much of a problem as market failures.
Such a clash of ideas is quite legitimate, and – if conducted in a civil and constructive manner – should be welcome in any community and polity. For one thing, it would provide legislators with a better understanding of the “problem” they are trying to solve (if there is a problem), such as:
the incidence of antibiotic resistance among Georgians;
immigrants competing with (or creating jobs for) low-skilled Georgian workers;
the extent of land grabbing (as well as investment and job creation) by Punjabi farmers.
Ultimately, whether liberal immigration regime (or free access to medications) is to be recognized as a “problem” is about politics rather than science. Still, having some evidence to consider before rushing with regulatory “solutions” would be a good step forward. It may well be the case that, while generating “killer” headlines, a “problem” is ridiculously small in magnitude or does not even exist.
Secondly, when faced with the need to publicly defend their proposals, proponents of regulations would be forced to analyze alternative solutions while taking into account the cost factor, effectiveness in terms of actually solving the problem at hand, related corruption risks, and other types of collateral damage.
DON’T BITE OFF MORE THAN YOU CAN CHEW!
But perhaps the most ideology-free criterion of evaluating the feasibility of regulations is whether a country has the requisite human capacities and skills. Even a relatively simple regulation, such as traffic lights, may be counterproductive if not properly planned and executed. First, there is the basic question of how to regulate a given intersection (traffic lights are effective only when traffic intensity exceeds a certain threshold level, which is almost never reached at night). Second, traffic lights have to be properly timed to maximize intersection capacity and minimize delays). Poorly planned traffic lights – hello, Tbilisi! – are not only a drag on traffic but also a safety hazard.
What is true about traffic, is equally true for extremely complex regulations such as anti-trust, labor, and food safety, which Georgia has subscribed to as part of the Association Agreement with the EU. For instance, it will take years – maybe even generations – to build the necessary professional capacities within the Georgian parliament and judiciary, the competition watchdog, the economics, legal and management professions in order to implement Swedish-style anti-trust law in the Georgian context. Thankfully, for now Georgia is paying lip service to some its EU-related commitments (e.g. by creating a competition agency and copy-pasting anti-trust legislation without caring to enforce it).
The botched attempts to rewrite immigration and pharmaceuticals laws suggest that professional skills are in extremely scarce supply throughout Georgia’s bureaucracy. After all, the Georgian state is one of the youngest in the world; Georgia’s educated urban elite is a tiny sliver of the population; and even this sliver has been impoverished by many years of brain drain and outmigration. In this situation, the Georgian state should not attempt to bite off more than it can chew. It should avoid complex regulations, even when these are theoretically desirable or required by its international partners. It should certainly avoid thoughtlessly copy-pasting regulations that have been designed for other times and other places.
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A short story by Leo Tolstoy titled “How much land does a man need” describes the fate of a land-hungry Russian peasant, Pakhom, who is promised as much land as he can walk around from sunrise till sunset. One condition is attached: he has to make a full circle and return to the point origin by the end of the day. To maximize his future land holdings, Pakhom sets on a rather ambitious circular route, and is too late to realize that he cannot make it back on time. He runs as fast as he can and, exhausted from the effort, drops dead at the point of origin. His servant buries him in a grave only two meters long, thus ironically answering the question posed in the title.
4 Beehives and their inhabitants from the high mountains of Ajara started their new life on the terrace of one of the largest Hotels in Batumi, Georgia, the Hilton Batumi, to produce honey for hotel guests. The General Manager of the Hilton, a keen birdwatcher and conservationist had the idea, seeking to showcase the beautiful countryside of Ajara and take this first step in illustrating the story of locally sourced food and the people who produce it.
By linking the hotel with the Ajara Beekeepers Business Association, the hives were installed. Urban beekeeping is increasingly popular in Europe as bee colonies decline and new ways are sought to develop a more ecologically sensitive lifestyle as urban centers grow. The Hilton also installed a honey showpiece at the breakfast buffet, of mounted honey comb, a large map of the 10 honey production gorges of mountainous Ajara and the indigenous flora on which the bees feed with the honey and comb sourced through honey producing company Matchakhela Ltd.
These initiatives which form a part of the ALCP programme’s work in the honey market system illustrate the great potential of the honey sector to feed into the promotion of Ajara as a great and varied tourist destination.
Income received from the Hotel hives will be donated to children in need in the rural municipalities.
News travels fast and perhaps other hotels may take up the initiative now it's been advertised through the Hilton chains newsletter.
Khelvachauri Women’s Room is taking its first steps in helping women access public resources voice their opinions and participate in local self-governance. The Women’s Room model that is being replicated in Ajara was first established in three municipalities of Kvemo Kartli from 2012 and subsequently in all municipalities of Kvemo Kartli and Samstkhe-Javakheti. The first opened in Batumi with the Association of Business Women of Ajara (ABWA) in the Ajara Chamber of Commerce and Industry (ACCI) was the first of all a new type of urban and business based women’s room, with the ideas of providing business trainings and an urban connection for the municipality based women’s rooms already opened in Keda, Shuakhevi, Khulo and Khelvachauri municipalities and soon to open in Kobuleti. The rooms are proving popular with these WR’s already providing more than 1200 services in three months.
The Women’s Rooms are a municipal service, a resource and consultancy space for facilitating open dialogue between local society and municipality officials, aiming at promoting women’s participation in the decision-making at the local level and increasing their access to municipal information and services including on health care and agricultural programmes. Women’s Rooms also offer a platform for trainings and meetings, supporting new initiatives and instilling women’s active participation. The space has been taken up quickly with the Association of Young Lawyers and the School of Democracy using the rooms to raise women’s awareness on human rights, economic and educational opportunities. Visitors can use library and internet for free. All of the Women’s Rooms in Ajara are easy to access on the first floor of municipality buildings and can be freely used by people with disabilities for meeting with Gamgebeli and other officials to speak about their issues. Gamgebelis hold weekly meetings with local citizens in the W’s Rs. A Free hotline number (Khulo 0 800 100 109; Shuakhevi 0 800 000 008; Keda 0 800 100 103; Khelvachauri 0 800 100 106) allows rural women to voice their issues in the Gamgeoba.
Women’s Room coordinators and municipal Gender Advisors, were trained on the importance of women involvement in decision-making using guidelines on The Application and Implementation of the Law on Gender Equality of Georgia by local self-government bodies to increase women’s participation in the community meetings, that was resulted in significant increase from 3% (2014) to 33% (2016) of women’s participation in these meetings.
To find out more about W’s Rs ongoing activities, visit Ajara (Batumi,Khulo, Shuakhevi, Keda, Khelvachauri), Kvemo Kartli (Dmanisi, Tsalka, Tetritskaro, Rustavi,Marneuli, Aspindza) and Samtskhe Javakheti (Akhaltsikhe,Adigeni, Borjomi ) W’s Rs Facebook pages.
Posted by Helen Bradbury: Team Leader, Alliances Lesser Caucasus Programme
ALCP has been featured on BEAM Exchange. See the story below.
Rural farmers can only grow their income when they have access to the drugs and veterinary services to keep their animals healthy and growing too. Alliances has partnered with a national veterinary inputs supply company to improve access to drugs, information and vet services for poor farmers in rural Georgia. There are strong signs competitors are seeking to replicate the model, which is also scaling up nationally and in neighbouring countries.
The challenge
Over 2 million people in rural Georgia rely on subsistence farming, typically owning less than one hectare of land. SDC has been funding a series of programmes in Southern Georgia since 2008 to improve the livelihoods of livestock farmers.
During initial surveys, Alliances learned that less than 10 per cent of farmers were accessing veterinary drugs or services in their community, in rural vet pharmacies mainly self-stocked from trips to Tbilisi. Others bought drugs when travelling to the capital. In the rural vet pharmacies a limited range of often improperly stored drugs were sold at high prices due to the resultant transaction costs. Local advice was minimal, unavailable or out of date. This had led to a lack of farmer trust in local veterinary products and services and unwillingness to invest.
Suppliers had failed to grasp the market potential of developing rural distribution, lacking both the information and capital to do so. The uncertainty about whether farmers would buy their products meant the perceived risk held suppliers back from making the first move.
Name: Natural Produktsia Ltd
Place: Dioknisi Village, Khulo Municipality
Type of business: Cheese Factory
Product: Imeruli Cheese
Suppliers: about 450 women from 13 villages of Khulo
Current production per day: 5 tons of milk (700 kg of cheese)
The Problem
The 450 women now selling milk directly to the milk collectors of the Natural Produktsia Ltd Factory in Dioknisi, Khulo used to make cheese from their milk. Women are responsible for milking the household cattle and making the cheese, butter, sour cream and cottage cheese which is then sold as an important part of the family’s livelihood.
Selling these products however is hard and uncertain. The journey by marshutka to Batumi Agrarian Market can take up to 4 hours on bad roads. It is taken to the market by husbands or other male family members or sent with the driver and met by a relative who then tries to sell it. There is no guarantee of a sale and often the family is forced to accept a low price from the market vendors rather than take it home again.
“Women in Georgia – Tradition and Contemporaneity” is a short documentary film prepared by ‘Netgazeti’ (online newspaper) about women living in Ghordjomi Community (Khulo Municipality, Ajara). Ghordjomi is one of the largest Muslim communities in Ajara and is known for its early marriage traditions, and other strict rules and attitudes towards women. The film describes the harsh daily routine of the women starting from 6 am in the morning with taking care of the cattle, children, household and the restrictions they face in daily life.
The ALCP AJ programme’s Focus Group Survey and Gender Analysis captured these issues and also noted the consequent effect on the participation of women in the decision-making processes at the community and local governmental levels which is chronically low.
From the ISET Economist Blog (https://www.iset.ge/blog/?p=4633)
By Eric Livny
The “do no harm” (primum non nocere) principle is well known to students of medical schools. It is one of the most fundamental maxims in medicine, as formulated, for example, in the Epidemics book of the Hippocratic Collection:
“The physician must … have two special objects in view with regard to disease, namely, to do good or to do no harm“.
Doctors are taught that medical interventions are not risk-free. Thus, when facing a “problem” one should consider whether to use a particular procedure (e.g. surgery or chemical treatment) or do NOTHING.
Not surprisingly, this very principle has applications in many fields other than healthcare. And it is high time for this principle to be studied and applied in Georgian policymaking.
