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DRAFT COUNTRY REPORT ON NATIONAL URBAN POLICY IN GEORGIA

By Hector Ward,2014-11-21 16:47
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DRAFT COUNTRY REPORT ON NATIONAL URBAN POLICY IN GEORGIA

REPORT ON NATIONAL URBAN POLICY IN GEORGIA

    1Nino Gerkeuli

    Introduction

     A person who once experienced the western way of life envisages Georgian urban landscape as the territory consumed with inconsideration; as chaotic, distorted and aggressive environment…” stated Prof. V. Vardosanidze, President of the

    Association of Urbanists of Georgia, in his recent article Spatial Planning and Urban Development of Georgia. This

    citation clearly describes the context of the problem subject to discussion in this policy paper. Georgia is located at the black sea, in Caucasus, bordering with Russia, Azerbaijan, Armenia and Turkey. The territory of Georgia is about 70 000 square kilometers with 310-km long coastline. Country is largely mountainous with Greater Caucasus Mountains in the north and Lesser Caucasus Mountains in the south. Two largest rivers, Mtkvari (Kura) and Rioni, along with the great number of small ones, flow in opposite directions thought its territory. Climate is quite diverse - from humid subtropical to continental. Diversity of landscape makes the land attractive for human settlements. Traditional drivers of economy are agriculture and tourism.

    Georgia is the country of old history and culture. First Georgian State was founded about 1000 years B. C. Tbilisi is the capital of Georgia since the fifth Century. It is situated on the both sides of the Mtkvari River, in the intermountain depression between the Greater and Lesser Caucasus, and covers an area of 350 square kilometers. Tbilisi is a large administrative, educational and cultural centre. Previously it was large industrial center as well. Other large cities in Georgia are: Kutaisi, Rustavi, Batumi, Sokhumi, Gori, Poti, Zugdidi, Telavi.

    Georgia has been undergoing the severe economic breakdown since the beginning of 90s. During the last few years with the help of international organizations, a series of reforms were implemented with stabilizing and positive results for the economy. The World Bank named Georgia “the number first economic reformer” ranking it 15 (up from 37 in 2007) in

    its “Ease of Doing Business Index 2009”. The main goals of the Georgian government for the years 2008-2012 are:

    Wellbeing of the population - Georgia without poverty; Ensuring national security and complete territorial and civil reintegration.

    Why the citation stated in the beginning of this paper is true? Author of the present paper aims to find an answer to this question by examining dynamics in the spheres closely related to the field of urban development. Research is based mainly on review of local and international experts’ papers in respective fields as well as official data.

    1. The Process of Urbanization

    The process of Urbanization, alike it was in other countries, started in mid-XIX century along with the process of industrialization. It happened gradually, mostly on the expense of internal migration then by natural increases, characterized by rural to urban trends, and generally in accordance with Reinstain’s Laws.

    At the beginning of XX century from rural (mostly highland) areas people moved down to the nearby cities and towns. Later the second significant outflow of younger members of households to larger cities has been recorded. Since 1950 this process became more intensive mainly due to the development of transportation networks. At the end of the century Georgia was considered Urban, as 54% of its population lived in urban areas. The present settlement system is presented on the map below.

    During the soviet period the settlement system had more or less balanced character. Highland Racha has been perceived to be the only problematic region suffering by depopulation as a result of developing industry. Other regions had clearly defined roles in country’s economy.

     1 Nino Gerkeuli holds Master’s degrees in Public Administration and Urban Planning and currently serves as an executive secretary at the Institute for European Studies, TSU, Tbilisi, Georgia.

    Internal conflicts, widespread stagnation and high rate of unemployment that followed collapse of the Soviet Union, as well as hopes inspired by Rose Revolution in 2004 and aspirations declared by the new President, increased interest towards activities in the Capital and contributed to the new wave of migrants towards Tbilisi metropolitan area. The balanced system has been changed.

    2. General Socio-Economic Conditions

    Georgia recorded substantial progress in economic growth after the Rose Revolution. GDP per capita that was the lowest among CIS countries in 1999 records stable growth (average annual growth is 7.8%) despite the consequences of internal conflicts. Liberal reforms from 2004 to 2008 laid a stable foundation for resilient economy. In this period GDP has increased by 45% with strong 12.4% in 2008. Despite the Russian aggression in 2008 August and Global financial crisis forecast for the real GDP growth is still positive (2.5%). Improvement of business and investment climate mainly by decreasing taxes and strongly developing banking services resulted in positive development of other related spheres as well. For example, construction sector only in 2005 grew by 22%.

    Governmental policies on rapid privatization, improvement of business and investment climate, promotion of SMEs and free trade, development of Banking system and services, and construction activities increased economic activities and job opportunities in urban areas, namely the Capital -Tbilisi.

Focus on Georgia’s transit capacity on international market caused rapid development of the Capital and transitional

    infrastructure. Major part of FDI (28.2%) goes on development of transportation and communication sectors (19.0% goes to energy sector, 15% to real estate). Traffic flows, construction, banking system, new commercial and business facilities and service sector along the improved central roads have increased dramatically. Less attention is paid to peripheries.

    On the opposite side International organizations continuously report on severe living conditions of population. According to the Department of Statistics at the Ministry of Economic Development unemployment rate is still quite high (13.8% by ILO strict criterion, 16.5% by-soft criterion) and significant part of population lives below the official subsistence level - 40.8%.

    3. Population & Migration

    Georgia is a multiethnic state composed by 68,8% of Georgians, 9% of Armenians, 7,4% of Russians, 5,1% of Azerbaijanis, 3,2% of Ossetians, 1,9% of Greeks, 1,7% of Abkhazians and 2,9% of others according to the last 2002 Census. Population of Georgia has been significantly decreased for a last decade and according to 2008 estimation is about 4, 631 million.

    Georgia as other post-soviet countries has been seriously affected by population migration, especially emigration. Census in 2002 revealed dramatic on-going changes in Georgia’s settlement system as well. The population of whole

    Georgia between censuses decreased from 5.400,8 to 4.571,1. Most cities, especially mono-functional cities, have suffered by sharp depopulation.

    The total number of internally displaced persons and refugees spread around the Georgia accounts for approximately 250 - 270 000 persons. The vast majority of them (72%) live in urban areas (88 680 in Tbilisi and 144 500 in Samegrelo-Imereti) and in extremely poor living conditions. Vast majority of IDP’s are peasants who find adaptation to urban way

    of life difficult. Nearly 130,000 are IDP’s from the recent war with Russia in August 2008. About 25,000 of them have

    been settled in 15 new cottage settlements ("mushroom villages") built within two months. This rapid settlement caused suspicious rumors that they are not expected to return home for the foreseeable future.

    As a result more about 1/4 of the residents of the country live in the Capital. Based on interviews and private observation the vast majority of settlements (both urban and rural) except those within Tbilisi metropolitan area suffer either by depopulation or aging of population.

    On the other hand a rapid inflow of young, active people into the Capital caused logical problems: Social adaptation of in-migrants became a serious problem. Rates of economic development and of immigration were inadequate.

    Overvalming migrants with rural habits brought their habits to the Capital. Capital happened to be unprepared for the large immigration. Social strata of population have been drastically changed.

    4. System of Local Governance

    The current system of territorial administrative arrangement is based on unjustified territorial administrative division of soviet times. Georgian constitution does not define the country’s administrative-territorial arrangement. According to

    Article 2 of the Constitution, the administrative-territorial arrangement of the country must be laid down by a special statute, on the basis of the principle of divided competencies, after the Georgian jurisdiction is fully restored on the entire territory of Georgia. Organic law on Local Self-Government adopted in 2005 and law on the Capital of Georgia

    Tbilisi, regulate organization and competencies of local self-government bodies and their relationship with the central government’s structures.

Despite significant history (the first attempt to establish local self-governance was done in 1991) it’s hard to declare that

    efficient local governance exists in the country. The lack of financial and technical resources, unskilled personnel, absence of strategic vision in problem-solving process in local government units, and frequent changes in legislation that cause contradictions, are recorded as major barriers in decentralization process.

    Since the Rose Revolution there is a tendency towards centralization of power in Georgia. Three sub-national levels of governance existed in Georgia until 2006: Nine regions (though they were not stipulated in the legislation) and two autonomous republics (Adjara and Abkhazia), 65 districts and six cities, which are not under the district administration, and 1004 municipalities (villages, communities, towns). The capital Tbilisi has functions of both a municipality and a region. Executives of the regions are appointed by the President (Trustees of the President of Georgia) and as practice shows they are quite powerful, thus this level was not regulated by legislation. Heads of executive branches of districts and cities are appointed by President from elected council members. The lowest level that was purely elective has been abolished as a result of amendments of legislation in 2007. The number of regional and district-level structures has been reduced by about half by simply merging them. At present the only level of local self-government with significantly shrinked rights of elected Council is a district.

    Centralization of decision-making power is explained by experts as a main objective to enable the central government to maintain political control over local self-governments and prevent consolidation of opposition forces. Less attention is paid to the efficiency of governance and services to the society.*

    5. Other Fields Related to Urban Development

    Problems inherited from the soviet period as well as those accumulated later have become increasingly acute in the face of new realities. Since the collapse of soviet regime governing rules of urban planning have drastically changed. Administrative regulatory mechanisms were out of use. Legal acts regulating urban environment during the last decade have been issued periodically, but most of them failed due to the economic crisis, the scarcity of financial resources, the absence of an appropriate legislative framework and the weak political will. Post-soviet period of turbulence has

    drastically changed the state of affairs in the field of urban development. Highly centralized, strictly hierarchical, cohesive system of planning and management has been spoiled. No other system, strategy or even approach has been considered instead.

    The process of privatization gradually started in early 90-ies had a lot of omissions that resulted in negative consequences. Property has been transferred directly from the state into private ownership without considering property rights of local governments. This omission was revealed later, after the earthquake in Tbilisi, when urgent need for municipal housing emerged. The urban land privatized six years later apart to the agricultural up to day in th sphere of legislation is considered as just non-agricultural land. The process of privatization has been started without consideration of new principles of urban development, importance of proper zoning and cadastral maps. Because of that most of territories around the urban areas, considered in soviet period as reserved territories for further development of settlements have been privatized. Problem of irreversibility is especially acute regarding historical parts of cities where process of massive privatization frequently entailed with illegal construction resulted in distortion and degradation of unique and highly valuable urban environment.

    The land market is developing more actively in urban areas. The establishment of primary land market comes to the end and the secondary market has already been lunched. A working group at the former Tbilisi Land Management

    Department on the basis of successfully completed project carried out with GTZ technical assistance elaborated Tbilisi Land Price Map. But this document put basis for initial market price of the land plots. No zoning regulations provide definitive legal guidance for defined areas of the city. Unfortunately, commonly accepted principle that urban land problems would be settled by the market economy cause problems that will be very acute in the nearest future.

Among other problems inherited from soviet time the crucial condition of housing is clearly exposed. For example,

    1,119 dwelling houses were amortized in Tbilisi, 461 of them were in need of emergency repair. The existing system of communal infrastructure is in desperate state as well. No large-scale renovation has been performed since 1991! Most of the local private building companies operating as developers on the real estate market persuade a goal to get benefits quickly. Consequently, quality of new constructions is very doubtful. New construction activities often caused damage of old buildings nearby. Scale of these new constructions most often were not regulated and building and sanitary norms - violated. In addition, new construction companies take no responsibility for reconstruction of communal infrastructure.

    Illegal construction has been a wide spread practice in urban areas. The former Ministry of Urbanization and Construction and the Municipality of Tbilisi issued rules for land-use and building regulations for the City of Tbilisi as an attempt to restrict scandalous constructions that took place in the Capital. New government that came into power after Rose Revolution successfully advanced construction activities by creating favorable conditions for foreign investments in the construction sector. But large scale construction projects vividly lack urban problem-solving approach.

    Secondary real estate market is developing. Number of private agencies specializing in sell and lease is increasing. The appraising has been established as a profession. Banks started providing long-term loans.

    6. Structural Arrangement and Legislation in the Sphere of Spatial Planning

    During the Soviet time planning system had extremely centralized, hierarchical structure operating on three levels. The structure of Legal-normative acts was entire for the whole Soviet Union. Whole system was financed from the state budget. Spatial planning documentation on these levels was as follows:

Macro-territorial level (entire Soviet Union) - General Scheme of the USSR Settlement for the whole country and

    Regional Settlement Schemes for all the Union republics were elaborated.

    Mezzo-territorial level - Regional Planning Schemes and Regional Planning Projects were elaborated and

    implemented.

    Micro-territorial (local) level (for settlements of different range and size) Master/General Plans of Settlements,

    dwelling districts and city centers; Detailed Planning Projects, neighborhood development projects, etc. were elaborated.

    All these plans were linked to each other in strictly hierarchical order, firmly connected and coordinated to the region planning process and implemented according to five-year Social -Economic Development Plans of the USSR.

    Organization of planning activities on different levels of governance in Georgia was as follows:

    Subcommittee on Urbanistics (Urban Development) used to function within the Committee of local (Self)-Government at the Parliament of Georgia. While the Ministry of Urbanization and Construction carried out the executive governance

    in the sphere of urbanization process management. Through its divisional units it was responsible for country’s

    territorial organization, sustainable and safe development of settlements, engineering and transport infrastructure, land use on urban territories, cadastre, city-planning and architecture, capital construction, construction industry, housing and communal services. The legal support to the Ministry of Urbanization and Construction was provided by number of Parliamentary committees and subcommittees: 1. Urban land was under the competency of Agrarian Issues Committee

    of the Parliament of Georgia, which directs problematique of land fund including urban land; 2. Settlement issues as well as issues of measures against natural disasters to the Mountain Regions and Settlement Committee that involved

    sub-committees of Social-economic Development of Mountain Regions; of Inner Migration Processes, Settlement and Adaptation; and of Ecological Sustainability and of Natural Disaster Issues of Highlands; 3. Territorial State Arrangement of the Country and City-Planning was under competency of the Committee of Regional Politics and Self-

    government; 4. Construction and communal services - Sector of economics with number of sub-committees including

    the sub-committee of Construction and Municipal services, which established Scientific-Consultative Council of Architecture and City-Planning; 5. Issues of urban heritage were under subcommittee of Cultural Heritage at the Committee of Education, Science, Culture and sports.

    Number of Scientific-research and Planning Institutes were responsible for carrying out research and planning documentations: one was responsible for planning for the Capital; second - for other cities and towns in Georgia; third for rural areas; fourth for major industrial areas. Beyond these there was a net of small-scale sectoral or divisional planning studios. Department of Monument Preservation of Georgia situated in Tbilisi under patronage of the Ministry

    of Culture along with the scientific work conducted works on preservation, restoration and rehabilitation of the archaeological, architectural and city planning heritage throughout Georgia according to the list of monuments of different importance. After collapse of the Soviet Union private firms were organized within abovementioned scientific-research institutions most of them working for emerging private developers. At present these institutes do not exist anymore and there is no level at which scientific research is conducted.

The most important task for Georgia today - elaboration of the strategy of spatial development was expected to be

    performed by the Ministry of Urbanization of Construction. But soon after the Rose Revolution it was incorporated into the Ministry of Economics and then simply abolished.

    As for local governments except the Capital were responsible for reviewing and approving Perspective Development General (Master) Plans of the Settlements developed by the local Chief Architect of the City or Region in accordance with hierarchically above plans. They as well had to develop and present to the Ministry the local social-economic development plans and provide services via divisional units operating within area of their administrative governance. According to the Organic Law of Georgia on Local Government and Self-Governance adopted in 2005, the competence of the local Self-governance Units includes: control and development of overall strategies, preparation of development plans, and provision of infrastructure for settlements under the jurisdiction of the local body in compliance with national laws. But local Governments fail to cover all expenses related to maintain and renewal the property and there is no tradition of planning or attraction of finances on the level of local governance.

    Different situation was in the Capital-Tbilisi. There used to be 21 city-services (departments, committees, units) at the Tbilisi Municipality including housing issues committee, commission for inspection of illegal constructions, department of communal services, etc. The Council of Tbilisi City-Planning used to operate as well. Mayor was appointing Chief Architect, a person responsible for all decisions regarding spatial development of the city. Tbilisi Architecture and Perspective Development Department, with nine divisional units, was responsible for all architectural, city-planning and construction issues in Tbilisi. Council of Architects and Urban Planners consisted of employees and invited experts used to have weekly meetings that were open for public attendance.

    After independence in 1991 the system of spatial planning and urban development in Georgia was practically destroyed. No system or even vision/framework was introduced instead. The principle “market will solve the problem” became a major principle mostly in all spheres related to spatial development.

    Although the Constitution of Georgia (1995) de jure established terms of legitimacy of the legislative and normative acts of the Soviet period, while new rules are developed and adopted within the two year period (II part of Article 106), strengthened with the Decree of the Minister of Urbanization and Construction of Georgia on February 5, 2002 on Prolongation of the Terms of Validity of Construction Norms and Rules, also of other Normative Acts on the Territory of Georgia. In accordance with this Decree normative acts of the Soviet period were subject to abolish only after enactment of new appropriate normative acts. But this does never happen. The General (Master) Plans have been

    prolonged in the areas were their legitimacy was expired, socioeconomic plans were ignored. The only law Concerning

    Spatial Organization and City Construction Basis adopted in 2005 is out of use.

    Large-scale construction projects that took place in number of cities besides the Capital - Signaghi, Batumi, Kutaisi, Mtskheta - were financed from the President’s and Governmental Special Fund and fulfilled by newly created small-

    scale planning units at local governments. The attitude, scale, and quality differ from city to city. No plans were exposed for public debate that in number of cases caused waves of opposition from general public, professionals, and NGO’s.

    Ministry of Regional Development and Infrastructure has been created recently but within its activities planning is not foreseen yet.

    7. Case of the Capital

    Tbilisi a City with about 1.5 million inhabitants (? of the entire Georgian population) stretches along the Mtkvari River. During the past decade city has presided over tremendous changes brought by painful and turbulent process of succession from Russia, civil wars and massive political strikes swept across the capital leaving their mark in burnt-out

    buildings and devastated infrastructure. Earthquake of 25 April 2002 struck Tbilisi leaving over 10000 buildings damaged. A fifth of them cannot be saved or restored among them 66 registered architectural monuments. Urban sprawl and chaos create many planning problems. Growing number of buildings which do not comply with the existing master plan last dated back to 1975 that had to be replaced by the new one in 2000. But it never happened. Introduction of temporary regulating document - zonning map didn’t help. A process of privatization left city’s

    inhabitants helpless against deterioration. The large-scale going-on construction activity in housing sector is focused on newly-riches. Urban poor is increased. Controversial plan last year to tax residents of historic districts to fund infrastructure reconstruction caused acute disputes.

    Studies revealed that prevailing majority (46.3%) of population of Tbilisi believes that Tbilisi became more provincial/rural during the last decade, and predict it’s ruralization for the next few years (45.7%). In addition, 26.0% expect no changes in this matter and only 17,?% believes that Tbilisi will be more urban (Association of Urbanists of Georgia, Sociological Analysis of Tbilisi Urban Development (2001). The urban space and that is most important culture of Tbilisi continues to deteriorate further and the fear that its unique quality of space will be lost forever remains realistic.

    The real estate sector has experienced unprecedented growth in recent few years, with property prices increasing dramatically in Tbilisi. The average price of commercial real state in central Tbilisi has risen from $ 250 per sq m. to around $ 3,000 per sq.m over the past five years. The increasing demand for high-quality commercial and residential properties, as well as tourist facilities, mainly hotels and recreational complexes, exists mainly in Tbilisi, Adjara and Sighnaghi, which has recently been redeveloped for tourism. Crisis unleashed by the military hostilities over the South Ossetia as well as world economic crisis have slightly slowed down construction activities as it negatively influenced prices on real estate and tourism development. Government strongly favors the real estate development by selling government-owned properties and deregulating the construction sector. For example, time needed to receive a construction permit has been reduced to 20 days for the smallest projects, and 60 days for the largest constructions. International interest in construction activities in Georgia, with limited attention to regulations and earthquake risks, is still remaining. Arab businessmen plan to invest as much as $200 million in construction of elite residential complexes in Tabakhmela and Tsavkisi, two areas located close to the Tbilisi center; Israeli investors plan to spend $100 million on the construction of a dozen luxury town houses; under construction are $100 million Radisson Hotel project, $200 million Park Hyatt project, due for completion in 2009; Kempinsky and Intercontinental chains have also announced plans for hotels, and the central government has reportedly held talks with Hilton Hotels as well. Six major business centers projected for 2010, and five major hotels set to open to 2010.

    The city government states that there are about 30 construction companies operating in Tbilisi. Certain companies even changed their profile and switch to construction as it seemed to be the most profitable business. At the same time little legal basis exists for managing the building frenzy, though city government representatives contend that they are in fact controlling the process. Zoning laws, introduced in 1970, expired in 2000.

    Increased number of private cars is just one of the city’s worries. Most of territories intended for Transport system

    development are privatized. In the solution of parking problems are left without any attention, transport and urban planning assessment of situation. Urban environment is not friendly to pedestrians. Among positive innovations are introduction of new Public transportation routs and system of payment using plastic cards. In order to resolve traffic problem, the Mayor’s office has developed a plan for the city development that been presented to City council in April 2009. According to this plan an attractive and relatively empty lot of 200 hectares of land in the middle of city currently used by two tracks of railway will be used for future major construction projects. Thus the adequate development or urban transportation system is possible only in the contest of land use planning.

    There is a huge amount of investment and the territory of the city is not prepared to receive this investment. City faces new reality the major part of its territory is already sold without any plan for regulation and there is a crucial need for a spatial order.

    8. Conclusion

    Coming out from above mentioned it may be stated that there is a lack of urban-planning approach in Georgia. Some problems in the field of the development of human settlements in Georgia probably are common for countries in

    transition: emergence of urban poor, unregulated construction, lack of attention to quality of living and environmental conditions. Some specific problems revealed in Georgia may be listed as:

- No scenario for sustainable development

    - Institutional degradation of the sphere of land use and spatial planning

    - No complex approach to spatial problems in urban areas

    - Quasilegal and out-of scale construction in prestigious districts

    - Housing policy does not exist

    - Transportation problems

    - Deteriorating of ecological conditions in the Capital

    - The dangerous tendency of ruralization of urban areas emerged

    - Increased earthquake risks due to low quality constructions

    - Local governments lack the property management skills

    - No public participation at all

    It is very difficult to present different policy options in the situation where policy itself does not exist. Only several hypotheses might be presented on this stage: The planning policy does not exist because of a) inappropriateness of existing legislation; b) demolished institutional system; c) lack of attention to the field.

    Proceeding from abovementioned information the main conclusion is that the core element of the problem and major impediment for balanced development of Georgia’s urban areas is mismatching of priorities: Central government

    envisages territory of Georgia mostly as a transitional country focusing on transitional capacity by encouraging investments in the Capital and transportation routes, while local governments lack capacity for development of sustainable local development plans. For Georgia, as for other post-soviet countries, it is increasingly important to develop a comprehensive strategy for sustainable development and management of abovementioned processes.

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