World Bank to assess damage to Georgia from war

The World Bank will send a mission to Georgia on Friday to assess economic damage caused by the conflict with Russia and to discuss reconstruction plans, a senior bank official said on Thursday. Theodore Ahlers, World Bank vice president for Europe and Central Asia, said Georgia's economic fundamentals were strong but the economy depended on foreign investment and growth would likely be affected by the war.
"At the government's request the bank will assist the authorities in assessing the toll of the damage and reconstruction needs with international partners and other stakeholders through a follow up mission," Ahlers said in a statement. He said the World Bank will help the government establish a multi-donor trust fund to help pay for the reconstruction and assist people displaced by the fighting between Georgian and Russian forces over the breakaway South Ossetia region backed by Moscow.
Ahlers said the World Bank assessment will focus on damage to infrastructure, such as roads and railway lines, as well as damage to the environment and agriculture sectors. The World Bank was a key financial backer and provided political risk guarantees for a $3.7 billion oil pipeline developed by a consortium led by BP.
The pipeline starts in Azerbaijan and runs through Georgia to the Mediterranean coast of Turkey, where oil is shipped to world markets. Ahlers expressed concern with reports of forest fires in Georgia's Borjomi national park area. Georgia has accused Russia of deliberately starting a fire that threatens to destroy a forest area regarded by Georgians as a national treasure.
"The World Bank sincerely hopes that arrangements can be made urgently to facilitate access to the area of the necessary equipment and other resources to bring these fires under control as soon as possible," Ahlers said.
The United States, the World Bank's largest shareholder, has expressed concern that the conflict with Russia will scare away future investment in Georgia and set back an impressive record of economic growth and reforms. Georgia had growth of 11 percent in 2007 despite Russian trade and transit barriers. Russia has agreed to pull back its troops from Georgia by the end of Friday but has stoped short of an extensive withdrawal demanded by the West.