Enclosure to Annex 2 of Protocol #5 of the JCC Session dated July 19, 1995 Tbilisi

On Widening the Scope of Activities of Economic Workgroup of the JCC with regard to the Territories that were involved in the Georgian-Ossetian Conflict

(OSCE – D. Boden)

Noting the technical and financial difficulties hampering the activities of the economic workgroup of the JCC with regard to implementing the agreement of Georgia and Russia on rehabilitation of the economy in the zone of the Georgian-Ossetian conflict concluded on February 1993,

Recognizing the obvious poor economic condition of the population in the zone of conflict caused by sharp reduction of the economic activities, in general, and, to certain extent, breaking of the previous economic contacts with the nearest regions,

Taking into consideration the fact that there is no comprehensive plan anticipating the beginning of the economic recovery of the region, including private sector and private capital,

Assuming that the absence of political resolution of the conflict should not hamper the recovery of the economic activities in the zone of conflict, but vice versa, the economic recovery could have pushed the parties to the conflict to political progress,

Expressing the confidence that under the appropriate circumstances it would be possible to persuade separate governments and international organizations to allocate part of their resources for the purpose of rendering assistance in the process of recovery,

the JCC resolves that the economic workgroup of the JCC should:

1. After studying the situation I  the zone of conflict and in the nearest regions, present to the JCC a repot on respective economic and social situation in the region, including the survey of the problem related to the development of the infrastructure (roads, rail road, power transmission lines and natural gas supply, house-building), rehabilitation of which may become the precondition of the overall economic recovery.

2. Define the cost of works on liquidation of the above-noted deficiencies and the priorities for the rehabilitation of various objects of infrastructure in the future action plan.

3. Define main problems of the agricultural production in the zone of conflict and nearest regions, such as lack of seeds, fertilizers, equipments, technical information, modern organizational structures, initial capital loans, and develop a plan for resolving the above-noted problems in 1996-97 agricultural years.

4. Consider the most perspective possibilities for rehabilitating contacts between entrepreneurial institutions of all types in the region and other enterprises with which they had business contacts in the past in the form of buyers, suppliers, sellers, joint ventures, etc., and recommend concrete measures for achieving the  goal through attracting the government and private sectors of North Ossetia, Russia, Georgia and South Ossetia.

5. Study the new spheres of the economic activities in the regions, which are perspective from the viewpoint of the economic recovery, or, were developed or non-developed at all, during the period of existence of the USSR.

6. Study, for these purposes, the possibilities of attracting funds and resources from the governments of the parties to the conflict, as well as from potential foreign donors, agencies and banks, related to the UN, such as the World Bank, the European institutions such as the EBRD in London and the European Union.; as well as sources of financing from permanent program on national aid and world capital markets.

7. Prepare the list of specific projects, by indicating the priorities and importance, including the procedure of implementing each project, and their approval by the JCC and potential donors.

(Archive of the Staff of the State Minister of Georgia for Conflict Resolution Issues/in Russian)