World Bank allocates $140m to Georgia’s main highway upgrade

The World Bank Group is continuing to support Georgia’s transformation into a regional transport and logistics hub by offering the country a large financial support package.

Work to upgrade the country’s main transport route - starting from the capital Tbilisi to Black Sea resort town Batumi via Poti - has been underway for some time however new funds awarded to the project will ensure the East-West Highway meets top European design standards and improves safety on one of the country’s most used roads.

Last week the World Bank Board of Executive Directors approved $140 million USD equivalent financing for the Fifth East-West Highway Corridor Improvement Project. The project aimed to help manage the road network and provide an enabling environment to improve logistics.

The project will directly contribute to economic development by reducing transportation costs and linking rural communities and their agricultural products to urban centres such as Tbilisi,” said World Bank Regional Director for the South Caucasus Mercy Tembon.

The East-West Highway will provide direct access to 2.2 million people or more than half of the total population of Georgia, read the project’s description.

Road safety improvements will also reduce the huge annual economic losses associated with road accidents,” Tembon added.

The main beneficiaries of the updated highway will be road users and the benefits will include:

• Better road quality and level of service;
• Avoiding or deferring costly congestion expected on the basis of mid-term traffic projections;
• Better road safety through new alignments and Khashuri [town] bypass, which will allow users to avoid hazardous crossing of urban areas by heavy transit traffic; and
• Savings derived from reduced transport costs.

The highway project was in line with the strategic directions identified in the country’s current 2014-2017 Country Partnership Strategy (CPS).

Those behind the project believed the East-West Highway corridor could have wider development impacts on Georgia’s economy, where its completion was estimated to contribute to an increase of real Gross Domestic Product (GDP) by around three percent.