Document of The World Bank Public Disclosure Authorized
Report No: 17275GE
Public Disclosure Authorized PROJECT APPRAISAL DOCUMENT
FOR A
PROPOSED LEARNING and INNOVATION LOAN (LIL)
IN THE AMOUNT OF SDR 3.4 MILLION EQUIVALENT
TO
GEORGIA
Public Disclosure Authorized FOR A
CULTURAL HERITAGE PROJECT
January 29, 1998
Public Disclosure Authorized Human Development Sector Europe and Central Asia Region CURRENCY EQUIVALENTS (as of end October 1997)
Currency Unit = Lari Lari 1 US $0.80 US$1.00 = 1.30 Lari
FISCAL YEAR Jan. 1-Dec. 31
ABBREVIATIONS AND ACRONYM
CAS Country Assistance Strategy CH = Cultural Heritage CHEC Cultural Heritage Executive Committee CHI Cultural Heritage Initiative ECA Europe and Central Asia GEF = Global Environment Facility GoG Government of Georgia IDF = Institutional Development Fund IDA International Development Association ICOMOS = International Council of Monumnentsand Sites LIL = Learning and Innovation Loan MoC = Ministry of Culture MoF = Ministry of Finance NGO Non-governmental Organization PIU Project Implementation Unit UNESCO = United Nations Educational, Scientific and Cultural Organization WMF = World Monuments Fund
Vice President: Johannes Linn Country Manager/Director: Judy O'Connor Sector Acting Director: J. Christopher Lovelace Program Team Leader: Thomas Blinkhorn i
Georgia Cultural Heritage Project
CONTENTS
A. Project Development Objective
1. Project development objective and key performance indicators
B. Strategic Context
I. Sector-related CAS goals supported by the project 2. Main sector issues and Govemment strategy 3. Sector issues to be addressed by the project and strategic choices
C. Project Description Summary
1. Project components 2. Key policy and institutional reforms supported by the project 3. Benefits and target population 4. Institutional and implementation arrangements
D. Project Rationale
1. Project alternatives considered and reasons for rejection 2. Major related projects financed by the Bank and/or other development agencies 3. Lessons learned and reflected in proposed project design 4. Indications of borrower commitment and ownership 5. Value added of Bank support in this project
E. Summary Project Analyses
1. Economic 2. Financial 3. Technical 4. Institutional 5. Social 6. Environmental assessment 7. Participatory approach
F. Sustainability and Risks
1. Sustainability 2. Critical risks 3. Possible controversial aspects G. Main Loan Conditions
1. Effectiveness conditions 2. Disbursement conditions 3. Dated Covenant
H. Readiness for Implementation
I. Compliance with Bank Policies
Annexes
Annex 1. Project Design Summary Annex 2. Detailed Project Description Annex 3. Estimated Project Costs Annex 4. Financial Summary Annex 5. Procurement and Disbursement Arrangements Table 5A. Project Costs by Procurement Arrangements Table 5B. Procurement Schedule Table 5C. Thresholds for Procurement Methods and Prior Review Table 5D. Allocation of Credit Proceeds Annex 6. Project Processing Budget and Schedule Annex 7. Documents in Project File Annex 8. Statement of Loans and Credits Annex 9. Country at a Glance Annex 10. Historical Context of Cultural Heritage in Georgia Annex 11. Environmental Data Sheet
Map No. IBRD 29231R Georgia Cultural Heritage Project
Project Appraisal Document
ECA Region Georgia Country Unit
Date: January 29, 1998 Program Team Leader: Thomas Blinkhorn Country Director: Judy O'Connor Sector Acting Director: J. Christopher Lovelace Project ID: GE-PE-55573 Sector: Multi-sectoral Program Objective Category: EA, PA, EN, PV Lending Instrument: LIL Program of Targeted Intervention: [] Yes [X] No
Project Financing Data [] Loan [X] Credit [ Guarantee [ Other [Specify]
For Loans/Credits/Others:
Amount(US$m/SDRmr):US$4.49 million / SDR3.4 million Proposed terms: [X] Multicurrency [ Single currency, specify Grace period (years): 10 years [ Standard Variable [ Fixed [ LIBOR-based Years to maturity: 35 years Commitment fee: 0.5% on undisbursed credit balance, beginning 60 days after signing less any waiver. Service charge: 0.75%
Financing plan (US$m): Source Local Foreign Total Government 0.36 0.12 0.48 IDA 2.96 1.53 4.49 Total 3.32 1.65 4.97
Borrower: Government of Georgia (GoG) Guarantor: N/A Responsible agency(ies): Cultural Heritage Project Implementation Unit (PIU) and Board of Trustees
Estimated disbursements (Bank FY/US$M): 1998 1999 2000 2001 Annual 0.58 1.32 1.32 1.27 Cumulative 0.58 1.90 3.22 4.49
Project implementation period: 3 yrs. Expected effectiveness date: 04/01/98 Expected closing date: 06/30/2001
OSD PAD Form: July 30. 1997 Page 2
A: Project Development Objective 1. Project development objective and key performance indicators (see Annex 1): The project development objective is to improve the management and promotion of Georgia's rich cultural heritage by (a) testing approaches that could revive the once dynamic tourism industry and (b) engendering social cohesion and national identity during the difficult economic transition.
Performance Indicators:
I. Increase in number of tourists, foreign and local, to pilot restoration sites and other sites benefiting from emergency repairs. 2. Incorporation by Government and communities of lessons from pilot project institution- building and physical investments into future new site restorations and cultural activities. 3. Improvement of capacities and skills of cultural heritage institutions, including at the community level, and stimulation of public-private partnerships in cultural heritage tourism. 4. Increase in numbers of cultural heritage related activities, such as national music competitions, arts festivals, and experimental dance troupes during project life.
B: Strategic Context 1. Sector-related Country Assistance Strategy (CAS) goal supported by the project (see Annex 1). CAS document number: 17000-GE Date of latest CAS discussion: October 21, 1997
The CAS supports the Government's development agenda in four broad areas: economic growth and diversification; strengthening of public finance; environmental protection, and poverty reduction. The proposed LIL supports the latter two objectives in the following ways:
1. Protecting the Environment. The project has already inspired a sequence of actions in the historic area of Old Town Tbilisi to address a serious underground water/wastewater problem (i.e. well monitoring investigation followed by detailed feasibility study, both financed by trust funds). Long term resolution of this problem can only be handled through other assistance activities such as the proposed Tbilisi Water and Wastewater Improvement project. In addition, the development of a Old Town, Tbilisi Integrated Conservation Management Plan will combine historic preservation guidelines with environmental planning principles. Environmental analyses will be carried out at the pilot sites, and specific site management and conservation plans will be developed for the two most environmentally sensitive sites (Uplistsikhe and Shatili).
2. Reducing Poverty. The CAS envisaged that this objective would be achieved indirectly, mainly through achieving sustained growth by sound macroeconornic policies, fostering development of the private sector, and through short term interventions targeted to vulnerable groups. Social analysis has revealed that most people living in or near the four pilot cultural heritage (CH) sites selected for assistance under this project are poor. By upgrading cultural sites and testing new opportunities for tourism development, the project will provide employment to some of these people. In addition, physical infrastructure and environmental improvements should enhance their standard of living.
The proposed LIL indirectly supports the other two CAS objectives by (a) piloting public- private partnerships for revival of tourism; if successful, this could serve the CAS goal of fostering new sources of growth; and (b) testing cost recovery mechanisms in selected cultural heritage areas that could, over time, supplement government finance and thus strengthen public finance. Page 3
Consistent with the CAS' overarching aims to foster a stronger private sector role in the Georgian economy while encouraging Government to pursue a supportive enabling environment, this project is intended as a single intervention in support of those goals. No follow-on assistance operation is planned by the Bank. 2. Main sector issues and Government strategy: The Government places high priority on sustained growth by encouraging the emerging private sector in all key economic areas. Among other things, the Government is beginning to implement plans to strengthen the legal system, reorient the structure of government (national and local), and rehabilitate basic infrastructure. Parallel investments to (a) protect and save unique cultural heritage sites from further deterioration and (b) revive or establish basic tourist infrastructure and services, offer high potential for future revenue generation in Georgia. Small but visible investments in historically distinctive cultural landmarks can also attract private investors.
In discussions with the Bank's country management team in Tbilisi in October 1997, the Government of Georgia (GoG) requested assistance from the Bank to provide a stronger cultural heritage dimension to its economic and social development program. Historically, Georgia's economy was highly dependent on tourism due to its unique ecological diversity, ancient cultural sites, rich traditions in art and music, and thriving crafts and handicraft industry. Before independence, the city of Tbilisi and the Black Sea coast attracted large numbers of visitors annually from Eastern Europe and the former Soviet Union. Cultural heritage provided a source of strong national identity and vibrant tourism. Since the breakup of the Soviet Union, tourism has collapsed and fiscal constraints have prevented essential maintenance and functioning of cultural sites and programs. Recognizing the significant national and global value of its cultural heritage, and its potential not only to enhance social cohesion but also revive the tourism industry, the GoG requested help to: i) further develop a longer term national CH program and ii) test physical and institutional investments through a Learning and Innovation Loan (LIL). The CH project will build upon the institutional foundation established under the IDF-supported Cultural Heritage Initiative (CHI), underway since 1996. This initiative has helped develop stronger public awareness of the importance of cultural heritage conservation, establish a new database on the most important cultural sites, and formulate new national legislation covering cultural heritage management and protection that will shortly be considered by the Parliament. The CH project design benefited from the experience with the Bank-financed Municipal Infrastructure Rehabilitation project, nearing completion, as well as the recently approved Social Investment Fund project. The latter project could, in some of its financing activities, complement the CH project by supporting urgently needed infrastructure rehabilitation. Finally, there are strong links between the CH project and environmental interventions in Georgia supported by the Bank, GEF, and other donors. 3. Sector issues to be addressed by the project and strategic choices: The project will indirectly explore ways of diversifying sources of economic growth and strengthening public finance. It will help generate local employment and alleviate poverty since the four pilot sites targeted for assistance have large numbers of very poor people, according to recent social surveys and income assessments. Through comprehensive conservation planning of cultural heritage sites, the project will also attempt to address the improved protection and management of environmentally fragile areas. At present there is both an economic and cultural urgency to the restoration of critical sites and material artifacts that are in serious states of deterioration. The CH project will test cultural and eco-tourism, and private sector involvement, in a potentially lucrative future tourism market. By emphasizing community-level initiatives and public-private partnerships, the project will test the scope and responsiveness of local community support to help manage and sustain such investments. The project will also pilot the implementation of new legislation and regulations in support of cultural heritage preservation. Finally, the project will help leverage assistance from other donors for cultural heritage preservation. This is already happening to some extent, as the Council of Europe and Page 4 the governments of Italy, Denmark, and the Netherlands are providing specialized technical assistance in various cultural heritage areas (i.e. legal reform; Kintsvisi church fresco restoration; Old Town, Tbilisi underground water investigations). There has been close collaboration throughout the CH project preparation with UNESCO, which has designated several Georgian CH sites as World Monument sites. The CH project design was tailored to complement work by other donors, most of which provide funding for technical assistance but not investment purposes.
C: Project Description Summary 1. Project components (see Annex 2for a detailed description aindAnnex 3for a detailed cost breakdown): 1. Investment Component
A. Emergency Rehabilitation Fund: This demand-driven Fund will respond to project proposals submitted by outside organizations and community groups. The Fund will provide financing for urgent repairs at priority CH sites, and for important cultural activities and artifacts at serious risk. Criteria for selection and evaluation of microproject proposals have been developed and agreed upon during appraisal. The Save the Georgian Culture Committee, established by the President's office, will evaluate proposals. The CH PIU will provide technical assistance to the Committee and beneficiaries, and will monitor and evaluate implementation of projects. In the initial stage of the Fund's operation, financing would be limited to US$75,000 equivalent for each approved activity; funds would be on-lent in cash (as grants) or in kind to organizations and community groups in accordance with memorandum of understanding between beneficiaries and the Save the Georgian Culture Committee. Details on application forms, the memorandum of understanding and related information will be contained in the Project Implementation Manual. (See attachment to Annex 2 for description of Fund and selection criteria).
B. Pilot Priority Cultural Heritage Sites: This subcomponent will finance four cultural heritage pilot sites for historic renovation and related activities. These sites were chosen through consensus by the Georgian PIU, CH committees on the basis of their priorities and respective cultural significance, evidence of community support for restoration and management, as well as community willingness to consider new public-private partnerships and possible cost recovery mechanisms. These sites will serve as prototypes for additional public and private partnerships in helping revive the tourist industry and for increasing the participation of community groups and municipalities in local cultural heritage protection throughout the nation. Funding for each of the pilot sites would be on-lent as grants to local authorities or community groups by the CH PIU in accordance with a signed Memorandum of Understanding that would reflect (a) a simplified plan, budget and schedule for operation and preventive maintenance for the proposed activity as endorsed by the community and (b) where appropriate, arrangements for promoting public-private partnerships as well as options for testing new fee structures at renovated tourist sites such as museums and parks. PIU staff and consultants would assist pilot site stakeholders with preparation of such plans. Local communities would be expected to contribute in cash or in kind to the project activity. Details on the pilot site plans and on-lending arrangements will be contained in the Project Implementation Manual.
In Old Town, Tbilisi, activities will include the renovation of historic buildings, including possibly an historic caravansary, facade and landscape improvements, and financing for historic home repairs of gutters and drainpipes. Investigations are currently underway to monitor the underground water problem in the Old Town in order to identify areas that are safe from water damage where investments can be initiated. A feasibility study, to be financed from a bilateral trust fund, will then identify least cost solutions which address the systemic underground water problem in the Old Town. Page 5
Other priority sites for restoration include the historic mountain village of Signaghi in the Kakheti wine-growing region of eastern Georgia; the ancient rock city of Uplistsikhe, a two hour drive from Tbilisi (see map); and the indigenous village of Shatili in the northern Caucasus mountains. Priority investments in Signaghi have been identified in consultation with the community, municipal govemment, and regional Governor, and include renovation of historic public and private buildings, a bed and breakfast hotel, and a regional tourism center and textile/handicraft center. In Uplistsikhe cave city, once a major tourist attraction, the major investment will entail the development of a site management plan and visitor's interpretation center. In Shatili, investments will include urgent structural repairs of ancient towers and a program to develop low-impact alpine tourism.
II. Technical Assistance Component
A. PIU Support and Institution-building: The project will strengthen and support the CH PIU in project management, finance and administration, procurement, monitoring and evaluation, engineering, and other specializations. Several foreign specialists will be secunded to the PIU for interim periods to advise PIU staff. The Ministry of Culture and other important cultural heritage institutions will also have access to technical assistance and capacity-building through voluntary participation in the Emergency Rehabilitation Fund, as well as training and study tours.
B. Training and Study Tours: Training will be provided by foreign specialists and Georgian counterparts to the PIU, other heritage agencies and institutions, municipal government, and community groups involved in the project. Study tours will include visits to smaller towns in western and eastern Europe that offer successful examples of cultural heritage conservation and tourism. In addition, provision will be made for a research initiative at one of the CH pilot sites, possibly Signaghi, which will involve provision of training for Georgian specialists in economic evaluation methodologies.
C. Public Awareness Program: A program of public information, education, and communication activities related to cultural heritage will be supported. These will involve the media and non- governmental organizations. Activities may include seminars for journalists, a CH newsletter, arts and music competitions, and oral histories on national culture, narrated by elderly Georgians and others.
D. Integrated Conservation Master Plan, Old Town: The plan aims to serve as a blueprint for all future development in the cultural heritage zone of Old Town, Tbilisi. It will be a collaborative effort between foreign specialists, Tbilisi city architects, the PIU, and other experts, and will include conservation and cultural heritage preservation planning principles and guidelines, as well as economic and market analyses.
E. Monitoring and Evaluation (M&E) Component: Monitoring and evaluation of all activities is crucial due to the nature of the learning and innovation loan. A Management Information System (MIS) will be developed by a specialist in the PIU as the major tool to monitor project impacts and performance. Other elements of the M&E program will include technical and financial audits, beneficiary assessments, Bank supervision, and independent reporting. Participatory monitoring will be undertaken by community CH committees at the pilot sites. Page 6
Component Category Cost Inc1. % of Bank- % of Contingencies Total financing Bank- (US$M) (US$M) financing Investment physical 3.57 72% 3.18 89% (goods, works, services)
Technical Assistance capacity 1.40 28% 1.31 94% building; project management; learningl adaptation; monitoring and evaluation
Total 4.97 100 4.49 90%
2. Key policy and institutional reforms supported by the project:
Key policy reforms supported by the project include: (i) irnplementation of new legislation for cultural heritage preservation; (ii) implementation of a fund-raising strategy to encourage private sector involvement; and iii) tests with partial cost recovery models (e.g. user fees at certain cultural heritage sites, community contributions). The development of an adequate institutional framework, including active national and local community CH Committees, and establishment of a solid foundation for a strategic national cultural heritage program, would also be supported by the project
3. Benefits and target population: As a key project objective, the CH investments will directlly benefit local communities at the four CH pilot sites, as well as those where emergency repairs will take place through employment opportunities arising from renovation work and revived tourism activities at historic cultural sites (e.g. bed and breakfasts, tours, tourism centers). Without the project, thiese unique sites and artifacts could either be lost forever or the cost of restoring them will increase significantly. The organizations that directly receive grants from the Emergency Rehabilitation Fund will also benefit. The Georgian population, and foreign visitors, may benefit through a more enabling environment for the revival of tourism, and through new opportunities to learn and access Georgia's unique cultural heritage. Greater private sector involvement will be tested, and private investors may also benefit. Different levels of government, including the Ministry of Culture and local municipalities, will benefit through capacity- building and direct investments. Additional benefits would include: (a) increased public awareness of the importance of cultural heritage preservation and support for it as a key element in future economic development of the nation; I(b)improved community organization and implementation capacity at the CH sites; (c) attraction of a wider network of donors, private investors, and corporate philanthropy in support of Georgia' s cultural heritage; (d) enhanced social cohesion through greater attention to the uniqueness of Georgia's cultural traditions and achievements. Page 7
4. Institutional and implementation arrangements: Implementation Period. The project would be implemented over a period of three years (1998-2000).
Executing Agencies. * The existing Cultural Heritage Initiative Board of Trustees/Council of Advisors, established by decree in 1996 with assistance from a Bank IDF grant, would have broad oversight responsibility. * The Cultural Heritage Executive Committee (CHEC) would serve as the Project Implementation Unit (PIU) for project activities, and have overall project implementation, management, coordination, and supervision responsibility. A project implementation manual containing details about project implementation procedures and processes is being finalized by the PIU. Completion of this document and its formal adoption, in a manner satisfactory to IDA, is proposed as a condition of credit effectiveness. Proposals for use of financing from the Emergency Rehabilitation Fund would be reviewed and evaluated by the national Save the Georgian Culture Committee, established by Presidential decree in March 1992. The Committee, comprised of representatives of the Ministry of Culture, Academy of Sciences, Parliament, the President's office, and other cultural institutions, will act on behalf of the President of Georgia. Technical advice, supervision, monitoring and evaluation would be provided by the PIU. * Community CH committees, with technical assistance and coordination provided by the PIU, would implement small-scale project activities at pilot CH renovation sites.
Project Coordination. The existing Cultural Heritage Executive Committee (CHEC) will continue as the renamed PIU with a mandate of project management and monitoring. It will serve as focal point for all communications with the Bank and other involved parties. The PIU is currently headed by an experienced Georgian art historian, with the support of a Technical Coordinator, Accountant, and Secretary; local consultants (lawyers, social scientists, public relations experts) also are employed periodically for selected tasks. Recruitment of additional foreign experts, in the fields of project management, procurement, financial management, and monitoring and evaluation, will be essential for building capacity in the small PIU for its expanded role in the project. Some financing is provided under the project's technical assistance component for these purposes, and trust funds are also being sought.
Project Oversight. The Cultural Heritage Initiative Board of Trustees/Council of Advisors, with broad representation of concerned Government agencies and non-governmental representatives, would facilitate coordination, provide policy guidance, and oversee implementation. The PIU would regularly submit progress reports to the Board based on performance and impact monitoring indicators. The Bank supervision team would also provide oversight and quality control.
Procurement and Disbursement. Detailed procurement arrangements and disbursement understandings have been agreed with the PIU/Govemment and will be reflected in the project implementation manual. Annex 5 contains a summary of the arrangements covering goods, civil works, and technical assistance, as well as disbursements.
Accounting, financial reporting, and auditing arrangements. The PIU would establish and maintain project accounts in a format acceptable to IDA, and have them audited each fiscal year, in accordance with Bank guidelines, by independent auditors also acceptable to IDA. It would maintain all documentation related to project expenditures, and would keep financial records in accordance with sound accounting practices. Page 8
Monitoring and evaluation arrangements. A project-specific Management Information System (MIS) will be designed by a specialist to serve as the key project monitoring tool. The PIU would be responsible for monitoring progress against specific performance and impact monitoring indicators. Indicators will include detailed progress benchmarks consistent with those spelled out in section A.1 above, and covering physical works, goods and services, institutional arrangements, procurement and disbursement, financial management, community involvement, poverty impact, and sustainability. The community CH Committees will furnish the PIU with quarterly beneficiary reports for review, summarizing implementation progress and utilization of project funds. An independent technical audit of works, a financial audit, and beneficiary assessments will be conducted after the first year of activities and in subsequent years.
D: Project Rationale 1. Project alternativesconsidered and reasonsfor rejection: Assistance through an ongoing or proposed Bank investnmentproject. This option was considered carefully and, in fact, it may be possible to consider limited assistance for local infrastructure improvements that also might benefit a cultural heritage preservation site (i.e. southern Georgia, which is the focus of the proposed Social Investment Fund (SIF) pilot project; a mountain access road to one of the pilot CH sites, Shatili, could be improved with financing from the same SIF project; the proposed Tbilisi Water and Wastewater project could provide assistance in helping to resolve the underground water problem in historic Old Town, Tbilisi). However, the approach of providing assistance through another operation was rejected because it was felt, particularly by Government, that the other investment activities had very different objectives and, thus, the quest for an overarching cultural heritage action program, with concomitant local management and delivery capacity, would not be served. Moreover, it was felt that the transition from the past state-centered cultural heritage protection cum tourism mode to one involving a strong private sector dimension would require a program of testing and innovation that would be difficult to pursue under a more traditional Bank investment operation.
Research/Development approach. This approach was rejected for two reasons: (a) it does not lend itself to local capacity development and utilization; (b) it lacks the operational flexibility in design and implementation that is essential for attempts to protect cultural heritage and revive tourism in a challenging environment of economic transition.
The adaptable lending approach (LIL). The approach is proposed here because it offers: (a) a flexible opportunity to test different approaches to cultural heritage preservation and tourism revival, particularly approaches that try to emphasize demand-driven, community-based innovations; (b) the opportunity for small-scale innovation and experimentation which is essential in a transition economy that is moving from state-centered management to more collaborative private-public patterns; (c) better client-responsiveness, in that it enables the Bank to meet an urgent Government request. It simultaneously serves as an effective catalyst in helping to develop stronger support networks with other interested partners and donors who may have specialized expertise in the cultural heritage or tourism field (i.e. UNESCO, Soros Foundation, Getty Trust, Aga Khan Trust for Culture, International Hotels Association), but who cannot contribute significant investment financing. Page 9
2. Major related projects financed by the Bank and/or other development agencies (completed, ongoing and planned): Sector issue Project Latest Supervision (Form 590) Ratings (Bank-financed projects only) Implementation Development Progress (IP) Objective (DO) Bank-financed Institutional development Cultural Heritage - IDF HS S
Community participation and capacity- Social Investment Fund Recently building at local levels (pilot) approved
Environmental protection and coastal Municipal Infrastructure S S zone management Rehabilitation Project (MIRP) with GEF Black Sea program Other development agencies
UNESCO & ICOMOS World Heritage Sites program Council of Europe Technical Assistance to CHI IDF
Conservazione beni culturali, Italy Fresco analysis in Italian Government Church of St. Nicholas, Kintsvisi Georgian Arts and Culture Center Church and fresco renovation, Church of St. Nicholas World Monuments Fund (WIvF) Monuments Watch List, Old Town Tbilisi Government of Denmark Cultural Heritage I Strategy, Tbilisi IP/DO Ratings: HS (Highly Satisfactory), S (Satisfactory), U (Unsatisfactory), HU (Highly Unsatisfactory)
3. Lessons learned and reflected in the project design: Lessons learned from the Bank's experience in transition economies and Georgia in particular with its strong ethnic diversity suggest the importance of (a) modest, community-based, demand-driven investments that address priority public needs; (b) thorough social assessments to ascertain stakeholders' interests and preferences; (c) flexible but comprehensive institutional arrangements; (d) programs that support social cohesion as an essential ingredient for nation building and sustainable economic development; and (e) well qualified NGOs to assist with public awareness-raising and community mobilization. Specific lessons learned from the IDF supported Cultural Heritage Initiative include: the importance of stronger inter-governmental collaboration for effectively planning a CH program, and the Page 1o desirability of updated legislation at national and local levels to encourage and enable cultural heritage learning and implementation.
The Cultural Heritage Project has been designed to reflect these lessons and to adapt successful methods from other projects, such as community-driven development in the Social Investment Fund and the Cultural Heritage IDF. The project design reflects the above lessons in the following ways: (a) Eligibilily criteria for accessing CH funds from the Emergency Rehabilitation Fund have been formulated in a manner to reward community participation and carry out priority repairs; (b) Georgian social scientists are being to conduct participatory social assessments in the four priority pilot sites; (c) Emphasis will be given to institutional development of the community CH committees for participation at the local level; (d) Support will be provided for NGOs and the media working in cultural heritage to promote public awareness and information dissemination; (e) Technical assistance will be provided to strengthen the PIU and other cultural institutions and to improve institutional coordination, information-sharing, and monitoring and evaluation; and (f) The newly established legal policy framework for cultural heritage preservation will be tested.
4. Indications of borrower commitment and ownership:
President Schevardnadze and senior policy-makers have repeatedly emphasized the importance of preserving Georgia's cultural heritage as an integral part of the economic development program and an essential tool for nation-building. Since so many Georgian citizens strongly identify with the nation's cultural heritage, its importance for national identity is felt to be particularly critical during the difficult, and often destabilizing, period of economic and social transition. V'isible investment projects that rehabilitate and restore the richness and diversity of Georgia's art, music, architecture, and history are likely to provide communities with opportunities for stronger socierlcohesion, improved capacity and skills, and employment.
Significant progress has already been made under the Cultural Heritage Initiative, supported by a $430,000 IDF grant approved in 1996, in the establishment of the institutional framework needed as a basis for managing cultural heritage programs. Shortly after Georgia achieved independence in 1989, the President established a special national "Save the Georgian Culture Committee." This was meant to signify the importance attached to the preservation of Georgian traditions and culture as a vital element for social cohesion and independence. On December 27, 1996, the Decree legalizing the Cultural Heritage Initiative Board and the CHEC was signed by the President. Georgia enlisted the support of the Council of Europe to assist in drafting laws and regulations for cultural heritage preservation. The laws will shortly be submitted to the Georgian Parliament for approval. Due to a recent well-received presentation by the CHEC, the World Monuments Fund (WMF) has now placed Old Tbilisi on its "Watch List" of priority historical sites for preservation and is prepared to assist with funding for specialized technical assistance. Under the IDF, the Cultural Heritage Initiative Executive Committee and Council of Advisors selected seven CH pilot sites in accordance with defined criteria. Members of the CHEC have visited each site and identified local counterparts to act as promoters and CH representatives. There has also been progress in efforts at fund-raising, a computerized database with detailed identifications (e.g. passports) of historic structures at each site, a public information campaign, and a program to catalyze community participation. The government has also established contacts with UNESCO and ICOMOS for guidance in the Cultural Heritage Initiative.
5. Value added of Bank support in this project: In recently emphasizing (a) the importance of investment in culture as an essential ingredient in economic development and (b) its willingness to work with other agencies to help improve assistance efforts in this area, the Bank is establishing itself as a stronger partner in cultural heritage preservation. Page 1 1
Although other organizations -- i.e. UNESCO, World Monuments Fund, Council of Europe, Getty Trust, among them -- have cultivated more technical expertise in this area, their assistance in developing countries and transitional countries is limited almost exclusively to technical assistance. Very little financing is provided for investments to protect or restore cultural heritage sites and ancillary development. Such investments are urgently needed, particularly in transition economies where serious CH deterioration has set in, and where delays in preservation will increase future restoration costs. The Bank has an opportunity to fill this gap by using its wider development experience and influence to catalyze more effective collaborative networks in support of cultural heritage preservation strategies and programs. The LIL offers flexibility and rapid response capability to test different approaches to cultural restoration and tourism revival. The opportunity will better inform future program investments.
E: Summary Project Analysis
1. Economic:
For the purposes of this project, cultural heritage includes both the material aspects of culture (e.g. sites, buildings, landscapes, objects of particular historical, architectural, aesthetic or cultural significance) as well as non-material aspects such as values, beliefs, social practices and symbolic forns of expression (e.g. language, art, music, dance, oral traditions, literature and poetry).
In relation to the main project objectives, the project's activities are expected to generate the following benefits: (a) concrete experience emerging from tests with public/private support models in CH restoration and related tourism planning that will provide a strong foundation for future revival of the once flourishing tourism industry in Georgia; (b) experimentation with different fee structures for visits to historic churches, monuments, and ancient city areas that will establish more realistic frameworks for future financial sustainability; (c) stronger community involvement and support for the idea of cultural heritage preservation as an important "asset" for future economic development; (d) improved institutional capacity to formulate and implement cultural heritage programs, as well tourism development; (e) enhancement of Georgia's distinctive CH patrimony through interaction with international agencies that support this area of activity; and (f) lessons from methodological research concerning economic analysis at one of the pilot sites.
2. Financial: Because of the nature of the LIL, including its size and emphasis on testing and innovation, the monetary and non-monetary benefits have not been analyzed in the comprehensive way normally associated with more traditional Bank investment projects. Since the LIL is effectively a pilot, the project will test a variety of approaches for providing financial support to target beneficiaries and experimenting with potentially profitable income-generating activities such as bed and breakfast facilities in cultural heritage/tourism sites. Preliminary socio-economic survey data indicate that many people living in or near these sites are very poor and have difficulty sustaining themselves through the economic transition period. Hence, they will not be expected to repay in financial terms. Nonetheless, efforts at partial cost recovery will be tested through entrance fees and community contributions in labor and in-kind. a Fiscal impact: The project's fiscal impact is potentially significant because its main objective is to invest in the restoration of valuable cultural assets that have the potential to help revive the collapsed tourism industry -- which used to be a major revenue-earner for Georgia's economy. With respect to project-specific benefits, the counterpart contribution from the central govemment budget is estimated at US$0.48 million or about 10 percent of the total project cost. The GoG's share of total costs would not exceed US$0.16 million in any given year. Assurances with respect to financial contributions Page 12 of the government, mainly through counterpart funds from the national budget but also through possible revenues from user fees and local communities at CH sites, have been agreed during appraisal and will be confirmed with Ministry of Finance during negotiations.
3. Technical: LIL pilot site renovation work will involve technical feasibility studies in engineering, as well as environmental and social analysis. Recommendations will be reviewed by the Bank, including cost estimates, engineering data to estimate inputs, outputs, and allowances for physical and price contingencies. A feasibility study of groundwater issues in Old Town, Tbilisi has been commissioned with Dutch and Georgian engineers, through financing from the N'etherlands Trust Fund. This will be peer reviewed in the Bank. The LIL will also test innovative technologies such as state-of-the-art fresco preservation and rare manuscript restoration, among others.
4. Institutional: a. Executing agency: The primary executing agency for the project will be the existing Cultural Heritage Initiative Executive Committee, renamed as the Project Implementation Unit (PIU). Details of the executing agency and project management are described earlier in Project Description Summary, Institutional and Implementation arrangements, pp. 6-7.
5. Social:
Social surveys have been undertaken in all four pilot sites by the CHI team of social scientists. Broader social assessments are currently being designed, with assistance from the Bank, and will also be carried out at each pilot site, beginning with Old Town, Tbilisi and Signaghi. The preliminary social survey in the Zemo Kala (lower quarter) area of Old Town, Tbilisi, indicates that the majority of the residential community is poor (an average household income of 30 Lari per month, with 30% of families earning less than 20 Lari monthly). The survey also included extensive data collection and interviewing of all 20 households (41 individuals) currently residing in the historic caravansary on Irakle Street, which is proposed as an investment subject to findings from the underground water study. Due to substandard living conditions (e.g. single room apartments with no plumbing, running water, or kitchens), all households are eager to move to improved housing, as long as they can remain in the Old Town. The findings from this preliminary work will be expanded into a more participatory social assessment, and if voluntary relocation is necessary, a full Resettlement and Rehabilitation Plan in collaboration with the affected people and the Tbilisi municipality, will be developed per Bank guidelines. This is a condition of disbursement for the historic caravansary. Special attention will be paid to gender-specific and environmental issues.
6. Environmental assessment: Environmental Category []A [X] B []C
The proposed project has been classified as a B (see Annex 11 Environmental Data Sheet). The project is expected to have an overall positive environmental impact through site management and conservation planning, emergency repairs at priority CH sites, landscape improvements, installation of potable water and sewage systems, and neighborhood funds to address water drainage problems of historic dwellings in Old Town and Signaghi. To help address the underground water problem in Old Town, Tbilisi, trust funds are financing the installation of a underground monitoring system to assess areas of risk and safety, which will guide investments. In addition, trust funds will also support a comprehensive feasibility study to identify cost-effective options to address the systemic rehabilitation of Old Town's underground water system. In the two ecologically sensitive sites of Shatili mountain village and Uplistsikhe cave city, site management plans will include environmental analyses that Page 13 encompass biodiversity protection and mitigation plans for tourist impacts.
7. Participatory approach: a. Primary beneficiaries and other affected groups: Primary stakeholders will continue to be involved in a participatory approach to identifying, designing and implementing pilot investments. They include: local residents at pilot sites, including residents of the Irakle Street caravansary in Old Town, Tbilisi, local government, potential beneficiary organizations of the Emergency Rehabilitation Fund, tourists (local and foreign), local vendors, and private investors. Social scientists in the PIU are currently working with local community CH committees in the first two pilot sites, Old Town and Signaghi, to increase their involvement in activities and ensure maximum community benefits. b. Other key stakeholders: Government of Georgia, Cultural Heritage Executive Committee (PIU) and Board of Trustees, Ministry of Culture, intermediary NGOs, academic institutions, technical experts and partners/donors (foreign and local).
Preparation Implementation Operation
Beneficiaries/community groups COL COL COL Intermediary NGOs IS, CON IS, CON IS, CON Academic Institutions IS, CON IS, CON IS, CON Local government COL COL COL Other donors CON CON IS, CON
Note: IS = information sharing; CON = consultation; COL = collaboration
F: Sustainability and Risks 1. Sustainability: Sustainability of this project depends to a large extent on the realization of the following fundamental underlying assumption: the once flourishing tourism business in Georgia, founded on the country's unique historical setting in the Caucasus and its rich ethnic diversity and culture, can begin to be revived and, over time, can become largely self-sustaining under new private-public partnerships instead of the old state-centered approach. A related assumption is that a re-invigorated cultural heritage program will help restore national pride and cohesion during a difficult economic transition and thus nurture public support for reforms. The risks involved are formidable, as noted below, and relate to national and local level inexperience with private sector support, project management, community engagement/participation, and lack of sufficient financing at the national and local levels. The innovative nature of this project, and its integrated monitoring and evaluation mechanisms, permit the kind of testing and experimentation that are so essential in the search for approaches to mitigate these risks and facilitate achievement of the long-term objective. For example, a closely monitored participatory process, through social assessments, will help to engage local communities in priority setting, and help ensure ownership and participation by community stakeholders. It is expected that this demand-driven, participation dimension, combined with the encouragement of local and private entrepreneurs (the latter particularly in the eastern, wine growing region, which also contains important culturally distinctive sites) will provide, in time, a more sustainable financial support model than the in the past. Options for financial sustainability will also be explored -- fees for visitors to renovated historic structures and museums; visitors' exit tax; entrance charges for music and arts festivals; and incentives for philanthropy. The new law on the support of cultural heritage, which is expected to be passed shortly by the Parliament, will be tested to determine its effectiveness in helping to mobilize private (foreign and Page 14
local ) financial support for regionaltourism developmentactivities. All of these activities,which impinge on sustainability, would be evaluated closely by the PIU's monitoring and evaluation team to determine their cost effectiveness and social viability.
2. Critical Risks (reflecting assumptions in the fourth column ofAnnex 1): Risk Risk Rating Risk Minimization Measure
1. Government creates appropriate incentives M for private and public investment in CH areas. 2. Political stability is maintained. M 3. Some decision-making powers are devolved M to municipal and community levels for cultural heritage management. 4. Government remains committed to N CH/tourism development and environmental protection. 5. Sustained financing for operation and S CH PIU will encourage maintenance of restored sites. community contribution and operation and maintenance plans. 6. Related, new investments in tourist H Active awareness and fund- infrastructure. raising program as part of CH project. 6. Active support and involvement of M Social assessments at 4 pilot stakeholders in community committees and sites underway. Strong focus on heritage tourism development process. capacity building of community- level CH committees and development of partnerships with government, private sector, NGOs.
7. Counterpart funding secured in MoF's N Initial counterpart contribution budget for all project fiscal years. as condition of effectiveness. Thereafter, PIU will confirm with MoF annual financial requirement. 8. Adequate coordination of technical aspects M Coordination experienced of preservation with international experts. through the IDF will help mitigate risks. Bank will take more active coordination role with foreign technical assistance. 9. Ability of municipality to identify and M Participatory social assessment. subsidize improved housing in Old Town for Pre-identification of potential caravansary dwellers to relocate, and housing alternatives before collaboration between parties. development of full resettlement and rehabilitation plan with community participation. Page 15
Overall Risk Rating M Learningand adaptation,M&E, and strongGovernment commitmentto project objectives will minimize risks. Risk Rating - H (High Risk), S (SubstantialRisk), M (Modest Risk),N (Negligibleor Low Risk)
3. Possible Controversial Aspects: Social 1. The development of an Integrated Conservation Master Plan for Old Town may entail protected historic area zoning, which could restrict other commercial development plans. However, there is little private sector finance currently available. A social assessment with stakeholder participation will be integral to the process of developing such a Conservation Master Plan, and should help identify competing interests.
2. Historic renovation of Old Town Tbilisi will entail community and municipal government participation in the design and implementation of projects. The process of participation and consensus- building will require time and patience, and could delay physical works. If relocation is required of 20 households living in the unimproved historic caravansary (Irakle Street), the municipality will need to first identify affordable, alternative housing and, in collaboration with the PIU and affected families, develop a full resettlement and rehabilitation plan consistent with Bank and GoG policies.
3. Adequate protection against vandalism at historic renovated sites will be required.
Ecological
1. A serious underground water problem in Old Town, Tbilisi has been confirmed by Dutch technical specialists during Appraisal. Trust funds are financing both installation of an underground monitoring system and a feasibility study to identify least cost options for rehabilitating the system. Large, structural investments will only be made in Old Town if the monitoring study identifies areas of safety from underground water damage. Otherwise, the groundwater problem will need to be solved, possibly through the Bank-financed Tbilisi Water and Wastewater project (currently under preparation), before major investments can proceed.
Governance
1. Inter-governmental coordination and clear delineation of roles and responsibilities will be essential for effective implementation.
G: Main Loan Conditions 1. Effectiveness Condition: a. Counterpart funding for the first year of the project has been deposited in a bank account for US$100,000 by target effectiveness date -- April 1, 1998. b. Completion and adoption of the Project Implementation Manual in a manner satisfactory to the Association. Target effectiveness date: April 1, 1998. Page 16
2. Disbursement Conditions:
Financing for the renovation of the Irakle Street historic caravansary in Old Town Tbilisi ($500,000 has been allocated for this purpose) will be subject to the following disbursement conditions: (a) Confirmation that underground water is not an impediment to restoration (water monitoring tests are about to be initiated and will be completed in three months); (b) Completion of a fully satisfactory resettlement and rehabilitation plan, consistent with Bank guidelines, and formulated in consultation with the 20 affected families (about 40 people). If these conditions are not able to be met, the money allocated for this purpose may be reallocated at Government request for other project related activities.
3. Dated Covenant:
Four foreign technical specialists (i.e., project management advisor, procurement advisor, financial expert, and Monitoring and Evaluation specialist) will be recruited by the PIU, on terms and conditions satisfactory to the Association, on or before May 1, 1998.
H. Readiness for Implementation
[N/A ] The engineering design documents for the first year's activities are complete and ready for the start of project implementation. [N/A] The procurement documents for the first year's activities are complete and ready for the start of project implementation. [X] The Project Implementation Manual is being finalized, and as a condition of credit effectiveness, will be completed and formally adopted by the PIU, in a manner satisfactory to IDA.
1. Compliance with Bank Policies
[X] This project complies with all applicable Bank policies.
Program Team Leader: Thomas Blinkhom
Sector Acting Director: J. Christopher Lovelace
Country Director: Judy O'Connor
January 29, 1998 page 17
Annex 1
Project DesignSummary
Georgia: CulturalHeritage Initiative
NarrativeSummary Key Performance Monitoringand CriticalAssumptions Indicators Evaluation Sector-related CAS Goal: (Goal to Bank Mission) 1. Economicgrowth 1.I Increase in the number 1.1.1 Government 1. Governmentcreates increasedand of related businessstarts statistics/reports; appropriateincentives for diversified,public in tourismby end of projectsupervision private and public financestrengthened, project. reports investmentin CH areas. and povertyreduced. 1.2 Increasein investments 1.2.1 Government 2. Politicalstability is by local and foreign statistics/reports; maintained. private sector project supervision 3. Therewill be new representativesin reports investmentsin related cultural related tourism tourist infrastructure. activities(e.g. B&Bs and tours). 1.3 Increasein number of 1.3.1 Government hotel rooms/beds statistics/reports; (includingfolk hotels) project supervision plus increasein reports occupancyrates by year 2002.
Project Development (Objective to Goal) Objective: 1. Sustainable 1.1 Increasein number of 1.1.1 CH PIU reports, 1. Governmentremains managementand new and continuing President'sCultural committedto CH/tourism promotionof Georgia's site restorations,both Committeereports, developmentand cultural heritage. publicand private and CommunityCH CH/environmental funded,in operationby Committeereports. protection. 1999and 2001. 1.2 Increasein number of 1.2.1 Ministryof Tourism 2. Sites willbe sufficiently local and foreign Statistics. fundedto ensureoperation tourists during 1999- Monitoringreports. and maintenance. 2002 period. 1.3 Increasein number of 1.3.1 Min.of Culture 3. There will be new culturalheritage related Reports,CH PIU, investmentin related activities(e.g. music CommunityCH touristinfrastructure. competition,arts Committeereports. festivals,public awarenesscampaign) by 2001. 1.4 Community-basedCH 1.4.1 CH PIU, local groups and programs government, continueoperating beneficiary effectivelythrough assessment. year 2001. page 18
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evaluation 1.5 New institutional 1.5.1 NGO reports, CH alliances formed and PIU reports. functioning. (e.g. Gov't.-NGO partnerships, coordinating groups, advocacy groups, focusing on certain target areas) Outputs: (Outputs to Objective)
1. Investment
A. Pilot Site Investments - 1. Communities support Selected activities in four programs. cultural heritage pilot sites are completed. 2. Counterpart funding will be secured in GoG budget 1. Old Town Tbilisi 1.1.1 Old Town Tbilisi Project monitoring reports. for all project fiscal years. restoration plan 1.1 Phase I of Old Town completed and Phase I Site inspections. 3. If necessary, current rehabilitation plan work started in dwellers of historic completed. Includes: conformity with Participatory Social caravansary participate in small historic home historic and cultural Assessment. voluntary Resettlement repairs, targeted facade values by mid -1998. and Rehabilitation plan. improvement, 1.1.2 Number of buildings landscaping/park fitted with improved 4. Local communities create improvement. gutters and drain functional CH Committees pipes. and implement priorities. 1.1.3 Old Town area maintenance improved.
1.2. Phase II of Old Town 1.2.1 Detailed engineering Project reports. rehabilitation plan and construction plans completed. (e.g. for Phase 11 Identified historic restorations completed buildings renovated) by 1999. 1.2.2 Strong community Social Assessments. participation during development and Project monitoring reports. implementation of project investment 1.2.3 Affected families participating in Phase I and 11of Old Town program. page 19
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evaluation 1.3 Resettlement and 1.3.1 Residents fully Resettlement and Rehabilitation Plan participate in design Rehabilitation Plan. designed and of plan. implemented. Beneficiary assessment.
2. Signaghi
2.1 Restoration of selected 2.1.1 Rehabilitation of Project reports. historic structures and selected culturally promotion of cultural historic structures Site inspections. and eco-tourism plan. completed by 2000. (e.g. Wedding Palace, Beneficiary assessments. Archeology Museum, private and community structures) 2.1.2 Drains, roofs, and gutters repaired/ replaced and improved by historic home inhabitants - completed by December 1999.
3. Uplistsikhe
3.1. Uplistsikhe site 3.1.1 Community-based site Project reports. management plan and management plan modem interpretation submitted and Site inspections. center completed. approved by 1999. 3.1.2 Interpretation center Social assessments. constructed by end of project.
4. Shatili
4.1 Shatili structural 4.1.1 Linkage with SIF Tourism statistics. investments in historic project funding by towers and 1998. Project reports. development of alpine 4.1.2 Shatili community- tourism program based site completed. management plan completed by 1999. 4.1.3 Development of fortifications of historic towers by 2000. 4.1.4 Rehabilitation and retrofitting for folk hotels by end of project. page 20
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evalunation 5.1 Community-based site 5.1.1 CH community groups Project repores. management programs and cooperators in 2 pilot sites designed operating programs at and operational. each pilot site by 2000. 5.1.2 Mobilization of private sector financing for tourism development by 2000.
B. Emergency Rehabilitation Fund 1.0 Three rounds of 1.0.1 First selection of Save Georgia's Culture emergency project project proposals committee applications and completed by June evaluation/selection selections completed. 1998. reports. 1.0.2 Annual project selections completed Quarterly reports by per schedule. beneficiary organizations 1.0.3 Timely and CH committees. implementation by beneficiaries of Independent audits. approximately 3-5 projects per year.
1 .1 Archive collection and 1.1.1 Better accessibility, Periodic review of conservation improved. organization and environmental conditions storage conditions. and collections.
1.2 Urgent rehabilitation 1.2.1 Risks of deterioration Periodic inspection of activities completed for averted; improved activities. proposed projects condition, appearance, evaluated and selected function, and by the Committee to accessibility of Save Georgia's Culture. selected emergency projects. 1.2.2 Improved conservation of cultural sites/ objects. II. Technical Assistance
1.1 Groundwater 1.1.1 Number and Regular monitoring of monitoring system distribution of wells. wells and periodic risk installed in Old Town 1.1.2 Results indicating analysis. Tbilisi (trust fund islands of safety (dry financed) areas) by May 1998.
1.2 Groundwater feasibility 1.2.1 Least cost alternatives Independent peer review of study completed for for rehabilitation of ground groundwater feasibility Old Town Tbilisi. (trust water system identified by study. fund financed) June 1998. . page 21
Narrative Summary Key Performance Monitoring and Critical Assumptions Indicators Evaluation
2.1 Cultural Heritage PIU 2.1.1 Management and Project training logs. and local municipalities English language strengthened. training attained by CHI PIU executive by end of year 1. 2.1.2 Management training Participant evaluations. for PIU Technical Director. Project reports. 2.1.3 Foreign specialists train andbuild technical capacity in PIU, 1998-2000. 2.1.4 Training for Georgian specialists on economic evaluation methods for one pilot site. 2.1.5 Training and study tours attained by local officials and CH PIU by mid-1999. 2.1.6 Increase in number of Beneficiary assessments. community- government partnerships formed. 2.1.7 Community CH Social assessments. committees in four pilot sites trained. 2.1.8 CH committee meetings held quarterly with 50% attendance.
3.1 Public awareness 3.1.1 Public awareness Project reports. campaign operational strategy developed by and effective. 1998. Collection of media 3.1.2 Workshops and outputs. seminars completed, media and other Public feedback activities performed evaluations. on timely schedule.
4.1 Integrated 4.1.1 Integrated plan Process documentation at Conservation Master achieved with full public meetings. Plan completed. public consultation. Consultations with primary and secondary stakeholders and experts. page 22
Narrative Summary Key Performance Monitoriingand Critical Assumptions Indicators Evaluation 5.1 Cost recovery test 5.1.1 Fee collection method Project reports. mechanism established designed and tested at and operational at pilot pilot sites by end Site visitor and tourism sites. project.. statistics. 5.1.2 Revenues increase at pilot sites.
6.1 Full monitoring and 6.1.1 M&E capacity Bank reviews. evaluation program transferred to PIU by implemented. 2000. Project reports. 6.1.2 Project MIS system fully developed and Annual beneficiary data/reports utilized assessments. by project managers Consultant audits. and bank team. 6.1.3 Annual technical and Country team reviews. financial audits completed. 590 supervision reports. 6.1.4 Bank supervision 2-3 times annually. Aide memoires.
Project Components/Sub- Inputs: (budget for each (Components to Outputs) components: component)
1. Investment US$3.57 million I. Progess reports. 1. Active involvement of key stakeholders in priority site 1.1 Old Town Tbilisi 2. Disbursement reports. selection, investment strategy, rehabilitation design and implementation. Phase I (e.g. targeted facade improvements; park landscaping; small neighborhood improvements).
1.2 Old Town Tbilisi rehabilitation Phase 2 (e.g. Sharteli St. #15 renovation; roof repair on Djvaris Mama Church; Pirosmani Museum)
1.3 Signaghi Restoration (e.g. Tourist Info. Center and handicraft studio established; restoration of historic buildings and identified residences; small neighborhood improvements) page 23
NarrativeSummary Key Performance Monitoringand CriticalAssumptions Indicators Evaluation
1.4 Uplistsikhe Tourism site management plan & interpretation center.
1.5 Shatili repair and renovation of historic towers and community- based tourism development.
1.6 Emergency Rehabilitation Fund
2. Technical Assistance US$1.40 million
2.1 Groundwater monitoring and feasibility study.
2.2 CH PIU strengthened for project management, supervision and M&E.
2.3 Trainers and study tour leaders hired and their programs designed and implemented.
2.4 Integrated Conservation Master Plan.
2.5 Cost recovery mechanism established at pilot sites.
2.5 Public Awareness program developed and implemented.
2.6 Monitoring and evaluation program
Total US$4.9 7 million page 24
Annex 2 Georgia Cultural Heritage Project Project Description
Project Component 1 - US$3.57 million
Investment. This project component will support the Georgian Government's ongoing Cultural Heritage Initiative (CHI) and would provide investment funding for rehabilitation/restoration at four cultural heritage pilot sites. The first investment subcomponent will be an Emergency Rehabilitation Fund which, based on specific eligibility criteria, can be accessed by organizations and communities for emergency repairs at cultural sites and/or for urgent rehabilitation of cultural artifacts. The second investment subcomponent covering four cultural heritage pilot sites will support high priority historic structures, facade and landscape improvements, public museum renovations, historic home small repairs, tourist information and interpretation centers, bed and breakfast and/or folk hotels, and other community-based improvement activities (civil works, goods, and services). The investment component will encourage active community participation through Community CH committees at the proposed pilot sites.
(a) Emergency Rehabilitation Fund (subcomponent) US$1.03 million. This subcomponent will provide financing for (i) urgent repairs needed to prevent further damage to priority CH sites; and (ii) urgent rehabilitation of cultural artifacts or support for cultural activities that are in serious jeopardy. The Fund will be competitive, driven by the priorities and interests of applicants, and designed to encourage communities and institutions to apply for grants of up to $75,000. Criteria for selection and evaluation of worthy microproject proposals have been developed. The President's Save the Georgian Culture Committee, in collaboration with the CH PIU, will serve as the Evaluation committee for this Fund (see attachment for description of Fund and selection criteria). The PIU will be responsible for providing technical assistance, and for supervising, monitoring, and evaluating microproject implementation.
Some preliminary sites and activities in need of urgent attention have already been identified. Such sites and activities could potentially qualify for assistance under this Fund. As an example, these include: (i) The Kintsvisi frescos at St. Nicholas Church; (ii) important museums or archives in disrepair; (iii) the David Garedji monastery, a unique eco-tourism site with a water harvesting system and cave drawings; and (iv) preservation of historic religious manuscripts.
(i) The St. Nicholas Church in Kintsvisi is one of the prel[iminary sites identified as suitable for emergency preservation. This famous monastery dates back to the period of Queen Tamar (12th century) and is rich in frescos of the same period. The most well- known fresco is the Kintsvisi blue angel, which has suffered damage from water and algae growth. Preliminary studies have been conducted in Kintsvisi by specialists funded under the Italian Trust Fund. Financing would be provided for emergency restoration, roof and drainage repair to the structure, and cleaning and rehabilitation of the damaged frescos, as determined by art preservation experts. page 25
(ii) The David Garedji monastery was built by monks into a hillside during the 10th century in a vast semi-arid region east of Tbilisi. The monks also fashioned a unique water harvesting system which supported orchards and fields. The project could provide financing for repairs to the monastery for the purpose of restoring the site, preserving frescos, and preparing a conservation area plan for low-impact ecological and cultural tourism.
iii) Georgia's Institute of Manuscripts houses rare and unique religious manuscripts, some of which date back to the I 0th century and earlier. The project would include parchment restoration and binding repairs of such historic manuscripts and assistance for controlled environmental settings and public display.
(b) Pilot CH Sites (subcomponent) US$2.54 million. The project would finance four pilot sites for preservation/restoration to serve as prototypes or learning tools for future cultural heritage investments and private-public partnerships designed to help revive the once flourishing tourist industry. These sites were selected by the Georgian Cultural Heritage Initiative after a year of investigations and consultations with local communities. Old Town, Tbilisi, and the village of Signaghi in Georgia's eastern wine-growing region will be the first two sites for investments. These will be followed by the ancient cave city of Uplistsikhe and the mountain village of Shatili in the northern Caucasus. More detailed descriptions of these sites follow:
(i) Old Town, Tbilisi - At this pilot site, multiple activities are planned, including: structural repairs, renovation, and retro-fitting of historic dwellings and buildings, including an historic caravansary, renovation of museums and collections, landscape and park improvements, facade improvements, and historic home small repairs to drains and gutters. Due to a serious underground water problem in the Old Town, investments will need to be phased and will depend on both i) identification of "islands of safety" where the underground flooding is less serious and/or ii) systemic rehabilitation of the underground water system in the Old Town. A groundwater monitoring system is being established at present, and a feasibility study which identifies cost effective solutions will be undertaken in the near future with funding from the Netherlands Trust Fund. If the underground water study indicates that the proposed renovation of the Irakli Street historic caravansary can proceed forward during Phase II, a full Resettlement and Rehabilitation Plan will be required in advance, in compliance with Bank guidelines (this will be a condition of disbursement for the Irakle Street site). This caravansary is one of Old Town's most valuable historic and cultural assets, but is currently in a state of serious disrepair for the twenty families it currently houses.
(ii) Signaghi, eastern Georgia - Signaghi is a provincial fortress town in the eastern Caucasus mountains. This scenic village of 3000 residents is situated about 115 km east of Tbilisi and is connected to the capital and eastern Georgia with good asphalt roads. The project will finance priority investments, as determined by the community, the municipal government, and the PIU. The support program will combine renovation of historic buildings with tourism development in the Kakhetian wine country. In addition to restorations of several historic public buildings and the archeology/ethnology museum, the project will finance restoration of several identified privately owned dwellings, retro- fitting of a bed and breakfast hotel, small repairs of historic houses; and a regional tourist information center with a handicraft studio. Efforts will be made to help organize page 26
textile and other handicraft artisans into a cooperative to help revive this once-robust industry.
(iii) Uplistsikhe - This ancient cave city dating from the Hellenistic Period is located l2km from Gori, the birthplace of Stalin, and is an easy day trip (about 2 hours) from Tbilisi. Uplistsikhe is on the left bank of the Mtkvari river, carved into rock with an architectural style influenced by the Persians and Romans. An asphalt road and a bridge over the river were built in the Soviet era, specifically for access to Uplistsikhe because it was a popular tourist attraction. However, since independence, tourism has declined significantly. Uplistsikhe also functions as a museum preserve under the main Board for Monuments Protection. This site has been identified by the Government as an historic Georgian monument. The project would support the development of a site management plan and a modem visitor's information and interpretation center. The center would include a geological, archeological, historic, cultural, and environmental interpretation display of the site, and would offer trained guides and walking itineraries. A book store with informational materials and brochures, and a small restaurant would serve visitors and raise revenues.
(iv) Shatili - This small, historic village is located in the northern Caucasus mountains, near the Chechan border. The site is inaccessible in winter, except by helicopter, and is difficult to access in spring and summer due to poor road conditions. Shatili is regarded as a premier alpine and ecological tourism site. The village is characterized by unique fortified towers which are constructed of local slate and which once served as dwellings. Many of the towers are deteriorating and at risk of collapse. The Shatili community is indigenous, and practices traditional farming and herding. The economy is based largely on barter exchange. The project would invest in urgent structural repairs of historic towers, gutters and roofs, renovation of towers for conversion into a folk hotels, and the installation of a potable water and sewage system to serve the community and visitors.
Project Component 2 - US$1.40 million
Technical Assistance: Financing would be provided to strengthen capacity at both national and local levels to improve CH management, and to support a monitoring and evaluation program for the LIL. Technical assistance activities will include:
(a) PIU Support and Institution-Building. Strengthening and support to PIU for project management, financial management, procurement, and disbursement will be a top priority. Several international specialists, such as a procurement advisor and project management advisor, will be recruited for periodic secundment to the PIU. In addition, the Ministry of Culture and other heritage institutions, such as the Institute of Manuscripts or Museum of Fine Arts, will also have access to technical assistance through participation in the Ernergency Rehabilitation Fund.
(b) Training and Study Tours. Training will be provided by foreign specialists (international and regional), and by Georgian counterparts knowledgeable in Bank procedures and project management. The PIU, community groups, municipal governments, the Ministry of Culture, and other heritage institutions will benefit from training as well. Study tours for key PIU and Ministry of Culture staff will include visits to towns in eastern or western Europe that serve as prototypes for cultural heritage protection and tourism. Research training will also be provided page 27 to Georgian economic specialists in economic evaluation methodologies for a specific CH pilot site, possibly Signaghi.
(c) Public Awareness Program. This program would build upon the ongoing public awareness work of the CHI and will help finance a variety of public information/dissemination activities, as well as special national events in support of cultural heritage. The program will develop a public awareness strategy for cultural heritage, and will fund tangible and visible outputs. Activities would be managed by the CH PIU, in collaboration with local non- governmental organizations and the media, and may include, among other activities: CH seminars for journalists (print and broadcast); a quarterly or monthly newsletter on CH activities; regular press conferences on the work of the CH initiative; development of a public information program on cultural heritage for the Georgia education system; CH poster competition for Georgian schools; national film and/or video competition on key CH themes; traditional music recitals for school children with special incentives for children from poor families; recorded histories (taped and produced for future public dissemination) involving elderly Georgians narrating their recollections of the impact of Georgian culture on their lives. All of these activities would be monitored and evaluated carefully to assess audience impact, cost and effectiveness with a view to improving future strategies and programs.
(d) Integrated Conservation Master Plan, Old Town. The Master Plan will address all aspects of heritage and conservation planning, and will include economic, social, marketing, and environmental analyses. A foreign specialist will work closely with the PIU, Tbilisi city architects, and other local experts to gather existing information, gather new data, and develop a comprehensive plan which can be used as a blueprint for the future of the historic Old Town. Public consultation and approval will be an integral part of the process.
(e) Monitoring and Evaluation Program (M&E). Monitoring and evaluation of all project activities would be supported under this program subcomponent. A specialist will develop a project-specific Management Information System (MIS) which will be the major tool for monitoring impacts and performance. Impact indicators and other performance measures have been developed and will be outlined in the Project Implementation Manual. They have been designed to allow sufficient time for testing, learning and adjustment in order to successfully achieve project goals. Other elements of the M&E program will include: annual technical audits, financial audits, periodic beneficiary assessments, and Bank supervision, including an implementation performance review (IPR) every 18 months. The project would finance establishment of a new monitoring and evaluation capacity in the CH PIU. The Community CH Committees, as beneficiaries, would be required to provide quarterly project reports to the PIU to facilitate this process. Additionally, a specialized consultant would be commissioned to independently monitor the progress of the project and report findings to the Bank and PIU every year. page 28
Attachment to Annex 2 Georgia Cultural Heritage Project
Emergency Rehabilitation Fulnd
Objective: The Fund would be used to carry out priority emergency cultural heritage conservation and preservation works.
Proposed Amount: US$1 million over 3 years. The Fund would be disbursed in annual tranches, with the first year not to exceed US$200,000; and the second and third years averaging US$400,000 each.
Design: A demand-driven, competitive mechanism which will respond to proposals from organizations (public and private) and award grants to the most worthy projects.
Institutional Framework:
1. The Fund will be established by the President's office with a special account. The Cultural Heritage PIU will collaborate closely with the Fund, and will be responsible for technical assistance, supervision, and monitoring of the Fund. 2. Evaluation and selection of eligible project proposals will be undertaken by the Save the Georgian Culture Committee, established by the F'resident in 1990. This evaluation committee will review and select project proposals against agreed criteria as elaborated below.
Mechanism: The Fund would be accessible on the basis of requests by Georgian institutions, NGOs, and community groups. Application forms would be made widely available to all interested institutions and groups nationwide, with equal access to all regions. The application form would require detailed information on the proposed activity, including:
I. name of site or cultural heritage object 2. location 3. significance of the site or object 4. current condition of site or object 5. objectives of proposed project 6. description of proposed project 7. estimated cost of the activity and costs over time 8. specific works to be funded 9. management responsibility for implementation (including designation of local site supervisor) 10. technical justification for proposed works 11. detailed work plan 12. project budget 13. evidence of community support and contribution to project page 29
Timeframe: The submission deadline for the first year's competition for proposals will be set at three months after the Cultural Heritage Project becomes effective/operational.
Proposed Selection Criteria:
1. Urgency. The activity must be an emergency or of urgent nature such that without the investment, loss of the cultural asset would be probable and imminent.
2. Cultural and historical importance. The activity must be of high and widely-recognized cultural/historic value.
3. Cost Limit. The cost of the activity will have no minimum limit and a maximum limit of US$75,000. A review of the criteria for size and limitations of proposed activities will take place after the first year.
4. Institutional Applications: Each institution will be limited to no more than 2 proposal submissions per year.
5. Cost Effectiveness of proposed intervention. Each project activity should be justified as a cost-effective investment in support of the protection of Georgia's cultural heritage.
6. Social Objectives: Each project activity should maximize social benefits to a wider community (e.g. benefits to a maximum number of people, direct benefits to a poor and/or vulnerable community).
7. Participation and Sustainability: Each project activity should consult with beneficiaries and invite their involvement in at least two ways: (i) community or organizational contribution (labor, in kind, funds) to project cost; and (ii) justification that beneficiaries place highest priority on the proposed project activity and have a sustainability plan for Operation and Maintenance (O & M). (Note: funds cannot be used for operational maintenance.)
8. Feasibility. Each project must be justified as technically sound and should be fully implementable within 1-2 years (within life of project).
9. Visibility. Each activity should maximize public visibility.
10. Funding. No project activity can be funded in part (unless if for completion) and subject to additional unsecured funding. page 30
Annex 3 Georgia Cultural Heritage Project Estimated Project Costs
Project Component Local Foreign Total ------US $ million------Investment 2.12 0.64 2.76
Technical Assistance 0.42 0.77 1.19
TQtal 2.54 1.41 3.95
Total Baseline Cost Physical Contingencies 0.46 0.13 0.59 Price Contingencies 0.31 0.12 0.43
Total Project Cost 3.31 1.66 4.97 page 31
Annex 4 Georgia Cultural Heritage Project
Financial Summary
(in US$ million, base year 1998)
Implementation Period l 1998 1999 2000 2001 Project Costs InvestmentCosts 0.65 1.31 1.32 1.26 RecurrentCosts 0.03 0.13 0.13 0.14 Total 0.68 1.44 1.45 1.40
Financing Sources (% of total project costs) IDA 12% 26% 27% 25% Govemnment 2% 2% 3% 3% Total 14% 28% 30% 28%
Main assumptions: - The project becomes effective by April 1998. page 32 Table 5A
Annex 5
Republicof Georgia CulturalHeritage Project ProcurementArrangements (US$'000))
ProcurementMethod International National Competitive Competitive National Consulting Total Inc. Bidding Bidding Shopping Services Contingencies
A. Civil Works 539.7 613.3 2,109.3 - 3,262.3 (485.8) (552.0) (1,870.7) (2,908.5) B. Goods - 68.8 48.7 - 117.6 (62.0) (43.8) (105.8) C. Technical Assistance - - - 1,593.2 1,593.2 (1,478.7) (1,478.7)
Total 539.7 682.1 2,158.0 1,593.2 4,972.9 (485.8) (614.0) (1,914.5) (1,478.7) (4,492.9)
Note: Figuresin parenthesisare the respectiveamounts financed by IDA
Table 5A page 33 Table 5B p.1 of 2
Annex 5
Georgia Cultural HeritageProject
ProcurementSchedule Total Procurement Issuanceof Submission Signingof Completion Packages Cost ($'OOO) Method Invitationto Bid of Bids Contract of Package
A. CIVIL WORKS
1. Tbilisi OldTown PhaseI Gutters & Drains 86.30 N.S. Apr-98 May-98 May-98 May-99 Facades (Irakli/Shardeni Sts.) 213.40 N.C.B. Apr-98 Jun-98 Jun-98 Dec-99 Landscape Improvements 138.00 N. S. Apr-98 May-98 May-98 May-99 Sub Total: 437.70
2. Emergency Rehab. Work (Fund) Package #1 (Year 1) 50.20 N.S. Jul-98 Aug-98 Sep-98 Dec-98 Package #2 (Year 1) 50.20 N.S. Jul-98 Aug-98 Sep-98 Feb-99 Package #3 (Year 1) 50.20 N.S. Jul-98 Aug-98 Sep-98 Feb-99
Package #4 (Year 2) 63.40 N.S. Jan-99 Feb-99 Mar-99 Jul-99 Package #5 (Year 2) 63.40 N.S. Jan-99 Feb-99 Mar-99 Jul-99 Package #6 (Year 2) 63.40 N.S. Jan-99 Feb-99 Mar-99 Aug-99 Package #7 (Year 2) 63.40 N.S. Jan-99 Feb-99 Mar-99 Aug-99 Package #8 (Year 2) 63.40 N.S. Jan-99 Feb-99 Mar-99 Aug-99
Package# 9 (Year 3) 63.40 N.S. Jan-00 Feb-00 Mar-00 Jul-00 Package #10 (Year 3) 63.40 N.S. Jan-00 Feb-00 Mar-00 Jul-00 Package #11 (Year 3) 63.40 N.S. Jan-00 Feb-00 Mar-00 Aug-00 Package #12 (Year 3) 63.40 N.S. Jan-00 Feb-00 Mar-00 Aug-00 Package #13 (Year 3) 63.40 N.S. Jan-00 Feb-00 Mar-00 Aug-00 Sub Total: 784.60
3. Tbilisi Old Town Phase 11 Shateli Street 111.30 N.S. Jan-99 Feb-99 Mar-99 Mar-00 Pirosmani Museum 160.90 N.C.B. Jan-99 Feb-99 Mar-99 Mar-00 Poet's Museum 46.20 N.S. Jan-00 Feb-00 Mar-00 Dec-00 Djvaris Mama Church 4.50 N.S. Jan-99 Feb-99 Mar-99 Jun-99 Irakli St. Caravansary 539.70 I.C.B. Jan-00 Mar-00 May-00 Jun-01 Sub Total: 862.60
4. Signaghi Wedding Palace & Museum 98.90 N.S. Apr-98 May-98 Jun-98 Jun-99 Barashteveli & Dodiani St. 137.10 N.S. Apr-98 May-98 Jun-98 Jun-99 Museum of Archeology & Ethnography 14.90 N.S. May-98 Jun-98 Jul-98 Dec-98 Saradjashvili St. 109.90 N.S. Apr-98 May-98 Jun-98 Jun-99 Tourist Info. Center 124.30 N.C.B. Jun-98 Aug-98 Oct-98 Oct-99 Small Home Improvements (Fund) 82.70 N.S. Apr-98 May-98 Jun-98 Dec-99 Sub Total: 567.80 5. Shatili Five Towers (fortification) 113.90 N. S. Jun-99 Jul-99 Aug-99 Aug-00 Gutters, Roads, Water & Sewage 131.10 N. S. Jun-99 Jul-99 Aug-99 Aug-00 Folk Hotel Renovation 89.00 N.S. Mar-99 Apr. 99 May-99 Aug-00 Sub Total: 334.00
6. Uplistsikhe One Visitor Center 275.60 N. C. B. Jun-99 Aug-99 Oct-99 Jan-01
Total Cost: 3,262.30
Note: N.S. - National Shopping (US$1.95M); N.C.B. - National Competitive Bidding (US$0.77M) I.C.B. - International Competitive Bidding (US$0.54M)
CWAnnex5 page 34 Table5B p2 of 2
Annex 5
Georgia Cultural Heritage Project
ProcurementSchedule iUSs'o0) Total Procurement Issuanceof Submission Signing of Completion Package Cost ($000) Method Invitation to Bid of Bids Contract of Package
B. GOODS
1. Uplistsikhe Visitor Center, Maps, Books, Signs etc. 68.80 N.C.B. Jun-99 Aug-99 Oct-99 Oct-00
2. Project Implementation Unit Computer Equipment & Scanner 48.70 N.S. Apr-98 May-98 Jun-98 Sep-98
C. CONSULTANT SERVICES (TA)
1. Project Implementation Unit Staff PIU 228.30 LC Consultants (Legal, social) 100.00 IC 328.20
2. Local T.A. (over 3 Yrs) M.I.S. Specialist 33.33 CQ Procurement Specialist 33.33 CQ Engineering Specialist 33.33 CQ 100.00
3. Foreign Consultants 326.40 QCBS
4. Training & Study Tours Session 1 31.20 Co - Session 2 31.20 CO - Session 3 31.20 CO - 93.60
5. Public Awareness Foreign Consultants 25.00 CQ Local Consultants 25.00 IC 50.00
6. Conservation Mgmt. Plan 50.00 Co
7. Monitoring & Evaluation 403.20 Co
8. Emergency Rehabilitation Fund 241.70 CQ-
Total: 1,710.70
Note: C.Q. - Selection Based on Consultanfs Qualifications(US$1.14M); Q.CB.S. - Quality and Cost Based Selection (US$0.33M); N.S. - National Shopping (US$.05M); N.C.B. - National Competitive Bidding (US$0.07M); I.C. - Selection based on Individual Consultants (US$0.12M). L.C. - Selection based on Least Cost (US$0.23M)
Fund for consultant services, small works, and small goods. Procurement methods include C.Q., N.C.B., small works, and N.S., in accordancewith thresholds.
GAnnex 5 page35 Table5C
Annex 5
GeorgiaCultural Heritage Project
Thresholdsfor ProcurementMethods and PriorReview
Contracts Subject to Expenditure Contract Value Procurement Prior Review/Estimated Categories (Threshold) Method Total Value Subject to Prior Review
1. WORKS <$150,000 N.S. FirstTwo Contracts >$150,000 N.C.B. FirstTwo Contracts >$300,000 I.C.B First Contract
2. GOODS <$50,000 N.S. First Contract >$50,000 N.C.B. First Contract
3. TECHNICALASSISTANCE <$50,000 IndividualConsultants All TORs;All contracts <$100,000 CQ for firms exceeding >$200,000 QCBS $100,000,and $50,000 ______LC for individual consultahts
Table5C page 36 Table 5D
Annex 5
Georgia Cultural Heritage Project
Allocation of Credit Proceeds
Expenditure Amount Financing Categories (US$ Million) Percentage
1. Civil Works 2.56 80% of expenditure
2. Goods 0.10 100%of foreign expenditure, 100%of local expenditure(ex factory);80% local expenditure
3. ConsultingServices 1.40 100%/oof total expenditures
4. Unallocated 0.44
Total: 4.49 *
*/ Numbersmay not add up due to rounding
Table5D page 37
Annex 6 Georgia Cultural Heritage Project Project Processing Budget and Schedule
A. Project Budget (US$000) Planned Actual (At final PAD stage) $25,000 + $5,000' $45,000
B. Project Schedule Planned Actual (At final PAD stage)
Time taken to prepare the project (months) 3.5 months 3 months First Bank mission (identification) 10/01/1997 10/01/1997 Appraisal mission departure 12/08/1997 12/08/1997 Negotiations 01/12/1998 01/27/1998 Project Approval by Vice President 01/30/1998 Planned Date of Effectiveness 04/01/1998
Prepared by: Cultural Heritage EC/PIU and Bank team
Preparation assistance: LIL team; Team Technologies, Middleburg, VA
Bank staff who worked on the project included:
Name Specialty Thomas Blinkhom Task Team Leader Angela Demas Operations Assistant Irakli Managadze Institutional Specialist Betsy McGean Social Scientist June 'faboroff Cultural Heritage Consultant Richard James Financial Specialist Ron Venezia Procurement Specialist Friedrich Peloschek, Aly Abu-Akeel Counsel Nicholay Chistyakov Disbursement Officer Tamara Kanterman, Maria Rigaszova Team Assistants
$5000from SocialCompact resources. page 38
Annex 7 Georgia Cultural Heritage Project Documents in the Project File*
A. Project ImplementationManual
Draft
B. Bank Staff Assessments
1. ImplementationSummary Report for the Cultural FleritageInitiative IDF grant, December31, 1996.
2. ImplementationSummary Report for the CulturalHeritage Initiative IDF grant, June 30, 1996.
C. Other
1. Report of Italian Consultantson Blue Angel frescos in St. Nicholas Church, Kintsvisi.
2. Report of Danish Consultanton planning parametersfor restorationof historic quarter of Tbilisi.
3. Report of GeorgianSocial Scientistson initialCommunity Participation assessment in selected CulturalHeritage sites.
4. Detailedreport on historicalsignificance of Uplistsikhe.Kakha Khimshiashvili (author).
5. Draft law on "Cultural HeritageProtection."
6. Speechof PresidentSchevardnadze to Councilof E;uropesummit meeting in October, 1997 on importanceof cultural heritage preservationto Georgia's future development.
*Includingelectronic files. page 39
Annex 8 Georgia Cultural Heritage Project Status of Bank Group Operations in Georgia IBRD Loans and IDA Credits in the Operations Portfolio
Difference Between expected Original Amount in US$ Millions and actual Loan or Fiscal disbursements a/ Project ID Credit Year Borrower Purpose No. IBRD IDA Cancellations Undisbursed Orig Frm Rev'd
Number of Closed Loans/credits: 2
Active Loans 0.00 0.00 GE-PE-39929 IDA30200 1998 GOVERNMENT OF GEORGIA SOCIAL INVEST. FUND 0.00 20.00 0.00 19.79 GE-PE-44797 IDA29830 1998 GOVERNMENT OF GEORGIA SAC II 0.00 60.00 0.00 19.98 19.11 0.00 GE-PE-50910 IDA29760 1998 GEORGIA MUNICIPAL DEV. 0.00 20.90 0.00 20.46 2.11 0.00 GE-PE-51034 IDA29840 1998 GOVERNMENT OF GEORGIA SATAC II 0.00 5.00 0.00 4.01 1.56 0.00 8.92 0.00 GE-PE-35784 IDA29580 1997 GOVERNMENT OF GEORGIA POWER REHAB. 0.00 52.30 0.00 41.00 .09 0.00 GE-PE-44830 IDA29440 1997 GOVERNMENT OF GEORGIA OIL INSTITUTION BLDG 0.00 1.40 0.00 1.17 .04 0.00 GE-PE-8415 IDA29410 1997 GOVT. OF GEORGIA AGRICULTURE DEVELOP. 0.00 15.00 0.00 13.14 0.00 GE-PE-39892 IDA28090 1996 GOVERNMENT OF GEORGIA TRANSPORT 0.00 12.00 0.00 4.86 2.61 2.72 0.00 GE-PE-44388 IDA28480 1996 REPUBLIC OF GEORGIA STRUCT. ADJUST. TA 0.00 4.80 0.00 2.51 2.74 0.00 GE-PE-8414 IDA28520 1996 GOVERNMENT OF GEORGIA HEALTH 0.00 14.00 0.00 11.26 GE-PE-8413 IDA26410 1995 GOVERNMENT OF GEORGIA INSTITUTION BUILDING 0.00 10.10 0.00 .08 -. 54 0.00 GE-PE-8417 IDA26580 1995 MINISTRY OF FINANCE MUNICIPAL INFRA. REH 0.00 18.00 0.00 2.30 3.92 0.00
Total 0.00 233.50 0.00 140.56 43.28 0.00
Active Loans Closed Loans Total Total Disbursed (IBRD and IDA): 89.57 137.04 226.61 of which has been repaid: 0.00 0.00 0.00 Total now held by IBRD and IDA: 233.50 135.00 368.50 Amount sold : 0.00 0.00 0.00 Of which repaid : 0.00 0.00 0.00 Total Undisbursed : 140.56 0.00 140.56
a. Intended disbursements to date minus actual disbursements to date as projected at appraisal. a b. Rating of 1-4: see OD 13.05. Annex D2. Preparation of Implementation Summary (Form 590). Following the FY94 Annual Review of Portfolio performance (ARPP), in letter based system will be used (HS = highly Satisfactory, S = satisfactory, U = unsatisfactory, HU = highly unsatisfactory) : see proposed Improvements Project and Portfolio Performance Rating Methodology (SecM94-901), August 23, 1994.
Note: Disbursement data is updated at the end of the first week of the month.
Generated by the Operations Information System (OIS) page40 Annex 9: Georgia at a Glance Europe& Lower- POVERTYand SOCIAL Central middle- Georgia Asia income Developmentdiamond' Populationmid-1996 (millions) 5.4 479 1,125 Life expectancy GNP per capita 1996 (UI$) 850 2,180 1,750 GNP 1996 (billions US$) 4.6 1,043 1,967 Averageannual growth, 1990-96 Population (Y.) -0.2 0.3 1.4 GNP A Gross Labor force (%) -0.1 0.5 1.8 per - -- prmary Mostrecent estimate (latest year available since 1989) capita enrollment Poverty: headcount index (,Y of population) 30 Urban population (% of total population) 58 65 56 Life expectancyat birth (years) 73 68 67 Infant mortality (per 1,000 live births) 18 26 41 Access to safe water Child malnutrition (% of children under 5) Access to safe water (% of population) Illiteracy (% of population age 15+) 1 Georgia Gross primary enrollment (% of school-age population) 82 97 104 Male 82 97 105 - -- Lower-middle-incomegroup Female 81 97 101
KEY ECONOMIC RATIOS and LONG-TERM TRENDS
196T 1985 1995 1996 _ GDP (billions US$) 2.9 4.6 Economicratios* Gross domestic investment/GDP . 34.3 4.0 5.0 Exports of goods and services/GDP . 16.2 11.8 Openness of economy Gross domestic savings/GDP . 31.1 -7.2 -1.5 Gross national savings/GDP .. .. -10.1 -2.6
Current account balance/GDP .. .. -14.1 -7.6 Interest payments/GDP .. .. 2.9 1.4 Savings ----- Investment Total debt/GDP .. .. 42.0 29.8 Totaldebt service/exports a/ .. .. 7.4 7.5 Present value of debt/GDP .. . 23.7 Present value of debtlexports . .. 217.7 Indebtedness
1975-85 1986-96 1995 1996 1997-05 (average annualgrowth) Georgia GDP 5.3 -19.0 2.4 10.5 6.9 Lower-middle-income grup GNP per capita 4.5 -17.2 2.0 12.7 6.8 Exports of goods and services .. .. -11.3 20.2 9.1
STRUCTUREof the ECONOMY 1975 1986 1995 1996 (% of GDP) bl Growthrates of output and investment(%) Agriculture .. 25.5 35.3 33.5 150- Industry 39.6 26.7 25.1 10Q- Manufacturing .. 30.2 20.1 18.9 Services .. 34.9 38.0 41.3 so-
Private consumption . 55.8 100.0 92.8 General government consumption .. 13.0 7.2 8.8 -so- Imports of goods and services .. .. 27.4 18.4 - GDI - D--GDP
1975-85 1986-96 1995 1996 (average annualgrowth) Growth rates of exports and imports (%) Agriculture .. . 5.5 3.0 30 - Industry .. .. 1.0 2.0 20 Manufacturing .. . 1.0 2.0 2 Services .. . 54.0 16.3 -
Private consumption .. .. -10.4 2.6 91 92 93- 94 se General government consumption .. . 52.7 52.7 -10- Gross domestic investment .. . 123.0 43.4 -20 - Imports of goods and services . . -15.5 9.1 Exports Imporis Gross national product 5.3 -17.1 2.4 6.9
Note: 1996 data are preliminary estimates. Figures in italics are for years other than those specified. The diamonds show four key indicators in the country (in bold) comparedwith its income-group average. If data are missing, the diamond will be incomplete. a / Debt service due after rescheduling. b/ GDP at factor cost. page41 Georgia
PRICES and GOVERNMENTFINANCE
Domestic prices 1975 1985 1995 1996 Inflation%)
(% change) 20,000 - Consumer prices .. .. 162.7 39.3 15,000 Implicit GDP deflator 0.7 -4.5 162.7 40.2 10,000-
Govemmentfinance 0.000 - (0%of GDP) 91 92 93 94 95 96 Current revenue (excl grants) .. .. 5.1 8.1 Current budget balance (exci grants) .. .. -6.1 -4.3 -GDP def. -O--CPI Overall surplus/deficit (excl grants) ,. .. -7.2 -5.5
TRADE
(millionsUS$) 1985 1995 1996 Exportand importlevels (mill. US$) Total exports (fob) .. .. 347 400 7o000 Black Metal .. .. 38 75 6,000 - Tea .. .. 11 26 5000 Manufactures .. .. 265 233 4,000 l Total imports (cif) .. .. 686 733 3,000 -I[ l Food .. .. 163 186 2.000 l-l Fuel and energy . .. 185 184 1,000-~I Capital goods 121 127 1,000-.- __ilIL0ilL- fflt. 90 91 92 93 94 95 96 Export price index (1987=100) .. Import price index (1987=100) ...... Exports 01Imports Terms of trade (1987=100) ..
BALANCE of PAYMENTS 1975 1985 1995 1996 (millions US$) Currentaccount balance to GDP ratio (%) Exports of goods and services .. .. 469 541 0 Imports of goods and services .. - 791 841 -5-- 90 91 92 93 94 95 96 Resource balance .. .. -322 -300 10 --
Net income .. .. -86 -50 -15 - - Net current transfers .. .. 0 0 -20 - -25 - Current account balance, -30 - before official capital transfers .. .. -408 -350 35-
Financing items (net) .. .. 448 269 40 - Changes in net reserves .. .. -40 81 45 - Memo: Reserves including gold (mill. US$) .. .. 158 158 Conversion rate (locaUUS$) .. .. 857.5 1,263.0
EXTERNAL DEBTand RESOURCE FLOWS 1975 1985 1995 1996 (millions US$) Compositionof total debt,1996 (mill. USS) Total debt outstandingand disbursed .. .. 1,212 1,365 IBRD .. .. 0 0 IDA .. .. 84 165 1B5
Total debt service a/ .. 35 42 IBRD . 0 C IDA .. 0 1 196.5 Composition of net resourceflows D Official grants .. .. 189 141 15 Official creditors .. .. 173 186 Private creditors .. .. 0 0 E Foreign direct investment . ., 6 20 988.5 Portfolio equity ,, ,, 0 1 World Bank program Commitments .. .. 75 91 A - IBRD E - Bilateral Disbursements .. .. 83 81 B - IDA D - Other multilateral F - Prvate Prncipal repayments .. .. 0 0 C- IMF G - Short-term Net flows 83 81 Interest payments .. .. 0 1 Net transfers 83 80
a / Debt service due after rescheduling. Development Economics 8/20/97 Note: Estimates for economies of the former Soviet Union are subjectto more than the usual range of uncertainty. page 42
Annex 10
Georgia Cultural Heritage Project
The Historical Context by Dr. Mariam Didebulidze
Georgia is geographically situated at the juncture of East and West. The history of its culture has always been tightly linked with countries of Near East and Eastern Europe. It has also played a role as political and cultural center in the Caucasus.
Georgia is a country of ancient culture, dating back to the earliest stages of human history. Archeological excavations reveal abundant works of rich and original art. The first signs of human life, found on the territory of Georgia (Dmanisi), are 1.8 million years old. Since then, all stages of development of human history have been witnessed in Georgia. Archeological evidence reveals a very sophisticated level of culture. Several Ibero-Caucasian tribes that inhabited this land (e.g. Karts, Svans, Mengrels, Lazians, Abkhazians, Meskhetians, etc.), began to unite and establish small states as early as 2-3 million B.C. They had common ethnic origins, and soon began to form one nation, the language of which became the language of the Karts.
Due to its geographical location, Georgia has always been a point of interest for the great states surrounding it - Assiria, Urartu, Persia, Rome, Byzantine., Turkey, Russia. Hence the history of Georgia, whether separated into smaller kingdoms or united into one state, has been one of unceasing struggle for independence against different inv,aders. Some of these invasions have been disastrous, causing the ruin and destruction of entire cities, villages, monasteries, and of the economy of the country. But nevertheless, Georgia manaLgedto preserve its nationality, state, and culture, and it still exists as a national state. For many centuries, since converting to Christianity in 337 AD, Georgia served as a Christian stronghold in the midst of surrounding Muslim countries.
Very early on the strong sense of national and cultural unity was developed among Georgian people. By the third century B.C., the king Parnavaz united the kingdom of East and the West Georgia with the idea of "one country, one language, one faith." King Parnavaz is presumed to have created the Georgian alphabet. In the seventh century, when the country was divided into several kingdoms, the famous monastic leader St. Grigol of Khanzta declared the idea of spiritual, religious, and cultural unity. This notion of spiritual and cultural unity independent from political circumstances was always very strong among Georgian people. This caused the exceptionally venerable attitude of Georgians toward their culture, especially in the last two centuries when the country became a colony of Russia and the Georgian state ceased to exist. The sense of national self-identity was tightly linked with the old culture. As one of the famous Georgian art historians remarked, "for the last two centuries we had no political history; our history was the history of our culture." While interest and respect toward the national culture is a natural phenomenon for all countries and their people, the historical misfortunes in Georgia fortified this attitude. page 43
Its noteworthy that alongside dreadful wars, invasions, destruction, religious persecutions, and at times real genocide (as with Persians in 17-18th c. in Kakheti), the Georgians continued to build monasteries, churches, and fortresses, continued to create frescoes and icons and polyphonic music, and continued to write poetry. The creative strength of the nation has been remarkable throughout history. The Georgian culture, created during more than 40 centuries, is a significant contribution to world culture and deserves veneration.
Specific traits of Georgian culture are its inclusiveness, wiLhconstant and very active interaction with other cultures (e.g. Greek, Roman, Persian, Byzantine, Arabian, Russian, Ndrth Caucasian, Armenian, European). The eagerness to develop cultural relations, and to adopt new forms, styles and methods, always imbuing them with its own traditions and creating something new and authentic, is the reason for strong creative activity and high artistic levels in works of art. This enthusiasm for inter-cultural relations has been revealed throughout Georgian history in its tolerant attitude towards the other nations more generally. For centuries the people of different nations came to live to Georgia and were never persecuted. There were never national nor racial confrontations among different ethnic groups or immigrants, including the Jewish people. Hence, despite its unfortunate political life, Georgia always played a role of cultural center and mediator in the Caucasus - for the North Caucasus, Armenia, and for Azerbaijan. Georgia was the center where the best of poets, painters, and scientists, from the region could come live in peace, study, and work. The pan-Caucasian strategic importance of Georgia must be maintained and strengthened so that Georgia can serve as a trusted mediator for many Caucasian problems.
However, the importance and significance of Georgian culture is not limited to the Caucasus. The development of Eastern Georgian and even more so of Near Eastern culture in general is hardly possible without the participation of Georgia, as witnessed both in political and cultural history.
The fine arts, architecture, and painting are the important contributions of Georgian cultural heritage, especially from the Christian period. Unfortunately, the current condition of many of these works of art is disastrous, as preservation and conservation works have been highly constrained over the last decade due to the unstable political situation and the fiscal problems facing the country. There are many talented specialists in Georgia who, if funds were available, could continue the urgent work of preservation.
The significance of ancient Georgian art hardly can be overestimated. The preservation, scientific research, and publication of these monuments will contribute to enriching the treasury of world art. Appropriate assistance in this field will provide not only improvements in the conditions of first-rate works of art, but also job opportunities for hundreds of specialists and community members around monuments who currently are unemployed or underemployed.
The sense of self-identity of Georgian people is deeply linked with their old culture, which for them is not merely a pleasant reminiscence of the distant past, but it is considered to be a live tradition, inspiring a new culture. The links between the past and the present are strong for Georgians, and art is an indivisible part of contemporary consciousness. In some way, the problems of moral and spiritual instability, uncertainty, and discontent in the consciou3ness of' Georgian people during the economic transition can be assuaged by carrying out ambitious programs of saving and preserving its precious national cultural heritage. page 44 ANNEX II ENVIRONMENTAL DATA SIIEET FOR PROJECTS in the IBRD'IDA Lending Program Country: Georgia Project IL) No: GE-PE-5573 ProjectName: Cultural Heritage TotalProject Cost: $4.97 million Appraisal Date: 12/8/97-12/12/97 BoardDate: N/A Task ITeamIcader Thomas 13inkhorn Managing Division ECSHD Sector Human Development Est. date for receipt of EA by Bank: N/A EA Category (A/B/C): B Date Assigned: 1/5/98
Dale Shea Prepared/Updated 1/8/98 (Please do not leave anv items blank. use "N.'A or "To be developed" when appropriate) Major Project Conponents: (presents descriptionof project components) I) Investment Component: Investments in historic structures, site management plans. landscapes, bed and breakfasts and'or folk hotel system at 4 pilot cultural heritage sites (Old To'un, Tbilisi; Signaghi; Uplitsikhe; Shatili). Emergency Rehabilitation Fund ($1 million) to respond to proposals for emergency repairs at cultural heritage sites and for at-risk cultural artifacts. 2) Technical Assistance Component: -Development of Integrated Conservation Master Plan for Old Town, Tbilisi -Support to CH Project Implementation Unit for management, financial review, procurement, social assessment, communt participation -Training and Study Tours -Public Awarenessprogram -Monitoring and Evaluation program, including Management Information System (MIS) Major Environmenal Issues: (describesmajor environmental issues identified or suspectedin project) 1. Underground water system leakages causing serious flooding and structural damage in Old Town, Tbilisi
IAer EnvironmentalIssues: (describesenvironmental issues of lesser scopeassociated with project) 1. Ancient archeology in Old Town, Tbilisi 2. Biodiversity protection and tourist impacts at Uplitsikhe and Shatili sites
ProposedAdions. (describesactions proposed to mitigateenvironmental issues described in project) 1. Underground water monitoring study will indicate "islands of safety" for historic renovations in Old Town (financed separately under Trust Fund) 2. Underground water feasibility study will identify alternatives for systemic rehabilitation of underground water system in Old Town (financed separately under Trust Fund) 3. Proposal to link Cultural Heritage project with Tbilisi Water and Sewage project to help finance underground water system rehabilitation in Old Town 4. Depending on fmdings from groundwater study, proposed rehabilitation of Irakle Street historic caravansary will require envirownental analysis and full Resettlement and Community Developrnent Plan for 41 dwellers (20 households).
Trust Funds will support installation of an underground water monitoring system and a groundwater feasibility study to address leakages causing serious underground water problems in Old Town, Tbilisi. page 45
5. Development of Integrated Conservation Mfaster Plan for Old To% n u ill include ens ironmental anal. sis and conservation planning guidelines. 6. Consulting archeologist to study impacts of proposed individual investments in Old Town 7. Site management plans which address biodiversity protection and mitigation of tourism impacts will be prepared for two environmentally sensitive cultural heritage pilot sites, Shatili mountain village and Uplitsikhe cave city. JuslzicatiowRadonalefor EavironmentalCategory: (reasons for env. category selected & explanation of any changes from initial classification) B category agreed by all parties. Most investments will improve overall environmental quality through landscape improvements, installation of potable water and sewage systems, site management planning, Old Town Conservation master plan, neighborhood funds for gutter and drain improvements. Trust Funds will fund investigations of the underground water problem in Old Town. SAatus of CategoryA Enviroennta Alssessment: (presents EA start-up date. EA first draft. and current status) N/'A
Remarks: (gives status of any other environmental studies, lists local groups and local NGOs consulted, tells whether borrower has given pennission to release EA, etc) 1. Underground water monitoring study for Old Town, Jan.-March, 1998 (financed by Trust Fund) 2. Underground water feasibility study for Old Town to be undertaken March-May, 1998 (financed by Trust Fund) 3. Biodiveitity Action Plan completed 4. New GEF Biodiversity Project (under preparation): may link to CH project in future
5. Georgia Protected Areas Group (NGO), and Caucasus Tours, consulted Dec. 1997 on Signaghi tourism, Shatili mountain site plannmg.
Signed bCS e | r Leader Leader/ ECSZ eader
.F_* p L _ Go A-Z January I1I, 1998 IBRD29231 R
40 41 42 43' 44' 455 46
GEORGIA CULTURALHERITAGE PROJECT
PILOTCULTURAL HERITAGE SITES r - B IU UP URBAN AREA
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