Transportation is a key contributor to Georgia’s economic growth. Economic activity associated with transport and warehousing in the country has grown rapidly, outpacing gross domestic product (GDP). Between 2010 and 2022, transport’s contribution to GDP nearly tripled, increasing from 1.4 billion GEL (520 million USD) to 4.1 billion GEL (1.52 billion USD). In 2023, transport and storage combined contributed 6.5% to Georgia’s GDP.

Transport and storage employed around 8% of Georgia’s workforce in 2023. Cargo movements spurred by Russia’s 2022 full-scale invasion of Ukraine pushed up sector wages by more than 25%, above the national average, despite an 8.5% drop in employment from broader labour market shifts. Overall, Georgia’s strategic location, infrastructure upgrades and participation in regional programmes have bolstered its economic resilience, improved connectivity and supported sustainable trade growth.

Georgia has served as a model of liberalisation in the South Caucasus. After joining the WTO in 2000, it signed an Association Agreement with the European Union in 2014, including membership in the Deep and Comprehensive Free Trade Area, which took effect in 2016. Georgia also acceded to the Energy Community Treaty in 2017, committing to transpose EU energy legislation, including the Third Energy Package. Reforms to comply with these obligations and the acquis communautaire (the body of EU laws and regulations) began in 2019, transforming the country’s energy market1. In December 2023, Georgia was granted EU candidate status, but the process was later suspended and most direct EU funding to central and local governments frozen after passage of the “Foreign agents registration act” 2.

Strong economic liberalisation, improved governance and abundant natural resources make Georgia highly attractive for foreign investment. From 2000 to 2023, the population declined slightly, at an annual average of 0.75%, while the number of households increased. The economy grew rapidly, with per capita GDP increasing more than tenfold, thanks largely to improved governance and an attractive business environment. The share of the population living in cities increased to 61% over the period from 53%, while the population is steadily aging due to lower fertility rates and emigration. Younger Georgians are increasingly moving to cities, concentrating economic activity in urban areas.

Economic gains have been broadly shared: average real incomes rose by nearly 50% from 2009 to 2019, and combined declared income plus social assistance for vulnerable groups increased by 86%. Real energy tariffs decreased – household electricity by 14.4% and natural gas by 20% – while access expanded. These improvements, together with a competitive business environment, a strategic location and strong institutional reforms, have positioned Georgia to capitalise on its economic, energy and transport potential while pursuing EU-aligned policy integration.

Georgia’s transport system is a vital link in the historic Silk Road network and remains a key trading hub, connecting Europe and Asia through east-west and north-south corridors. Cargo shipments rely mainly on roads, rail and shipping via Black Sea ports (Batumi and Poti). Roughly 60% of freight is transported by road, which also accounts for about one-third of transport-related emissions. The country also serves as a transit route for energy commodities, including electricity, oil and natural gas, supported by several major pipelines and ongoing upgrades to electricity and gas infrastructure funded by the European Union, World Bank, Germany’s Kreditanstalt für Wiederaufbau (KfW), and the European Bank for Reconstruction and Development (EBRD).

The 11-country Central Asia Regional Economic Cooperation (CAREC) programme5, led by the Asian Development Bank (ADB), has strengthened Georgia’s transport infrastructure, streamlined customs and enhanced regional trade competitiveness. Investments in roads, including the East-West Highway, as well as border facilities and transport policy reforms, have improved transit efficiency, reduced travel times and increased safety along critical corridors. CAREC’s Corridor Performance Measurement and Monitoring system tracks and enhances trade corridor performance, while Georgia is piloting the digital CAREC Advanced Transit System (CATS) to simplify cross-border procedures and cut costs.

International lenders have helped Georgia modernise its road network, with a focus on regional cargo routes. As of the second quarter of 2025, the total length of completed and operational highway network is 377 kilometres. Over the past decade, agencies such as the World Bank, European Investment Bank (EIB), and the Asian Development Bank (ADB) have financed major upgrades to Georgia’s main transport routes, especially the East-West Highway. In 2024, work advanced on the most difficult stretch, known as the Rikoti Pass Road, with its just under 100 bridges and around 50 tunnels, with only four kilometres of the 52- kilometre stretch remaining under construction.

In a 2023 report, the World Bank also identified policies and investments that could help to triple regional cargo capacity across the middle corridor and slash travel times by half. The ADB and the EBRD were the main international financiers for the Kvesheti-Kobi Road segment on the North-South Highway. The segment, completed in 2024, reduces travel time and makes the route connecting Russia, Georgia and Armenia passable even after severe winter storms.

Investments in the east-west and north-south corridors aim to expand Georgia’s role in global cargo flows and improve rural-urban connections. By late 2024, more than 70% of the 302-kilometre East-West Highway was complete and open to traffic, with 35 kilometres under construction. Completion of the entire 430-kilometre route is expected by 2030.

Georgia has also deepened regional ties: In 2022, it adopted a joint roadmap with Azerbaijan, Kazakhstan and Türkiye to accelerate multimodal freight rail service, and, in 2023, launched Middle Corridor Multimodal, a logistics joint venture linking the Azerbaijan, Kazakhstan and Georgian railways – and joined in 2025 by the China Railway Container Transport Corporation. The venture aims to harmonise tariffs, integrate infrastructure, unify transit services and speed cargo along the China-Europe route.

Rail freight in Georgia surged in 2022 following Russia’s full-scale invasion of Ukraine, before falling slightly in 2023. Transit movements now account for around 60% of rail cargo, up from around 50% prior to 2021. Imports make up roughly one-quarter of rail shipments, followed by domestic and export cargo. The main commodities shipped by rail include oil and oil products, chemicals, metals, coal, gas and food products. Kazakhstan, Armenia and Russia are the main destinations for commodity exports, while nearly half of imports (mostly oil products) come from Russia. Additional oil product imports come from Azerbaijan, Romania, Bulgaria and Türkiye.

Although most of Georgia’s railway network is electrified, diesel locomotives remain in use, mostly on non-electrified and low-traffic freight corridors – including areas where electrification is not economically feasible. Some low-demand passenger routes still use older DR1AM diesel trainsets6, underscoring the economic and technological limits to rapid electrification and modernisation.

Rail upgrades are set to bolster Georgia’s role in the middle corridor, linking central Asia and China to Europe by increasing freight capacity to 48 million tonnes annually. Investments totalling around EUR 150 million from 2011 to 2024 delivered significant upgrades to the Tbilisi-Makhinjauri (Batumi) line, including tunnels and bridges, the addition of new tracks and the modernisation of rolling stock7. Digital systems, new logistics centres, and multimodal hubs are being developed to improve efficiency. These improvements are expected to cut travel times between Tbilisi and Batumi by more than 40 minutes, making rail journeys shorter than by road. They will also improve operational and technical efficiency, as well as system reliability and durability, while reducing the carbon intensity of rail operations. The upgrades are financed through green bonds and support from the EBRD.

Georgia’s rail lines are interoperable with Azerbaijan and Kazakhstan, sharing a common gauge and other infrastructure inherited from the Soviet railway system. The USD 1 billion Baku-Tbilisi-Kars line8, expected to expand cargo capacity significantly9, is scheduled to be completed by the end of 2025.

A major effort is under way at Georgian Rail to boost efficiency and service quality, stabilise finances and align operations with EU directives. One of the country’s largest state-owned firms, Georgian Rail employed 12 378 people in 2022, and until recently operated as a vertically integrated company, managing tracks, stations and trains.

The ongoing reforms, launched in 2023, will give Georgian Rail a new legal and institutional framework aimed at improving safety, bolstering organisational and staff capabilities and enhancing sector transparency and competitiveness.

Until recently, passenger fares and costs were cross-subsidised by freight, which accounted for 57% of base revenue and 90% including ancillary services. Through the early 2010s, oil product shipments generated high profits, but pipelines from Kazakhstan and Azerbaijan diverted much of this traffic, causing sharp revenue losses.

In June 2024, the Rail Transport Agency – a legal entity of public law under the Ministry of Economy and Sustainable Development (MoESD) – signed a direct Public Service Contract with JSC Georgian Railway for passenger rail services. The contract funds passenger rail through 2028, and requires the operator to ensure specific routes, service levels and frequencies.

The ADB and Agence Française de Développement (AFD) backed the reforms with EUR 20 million in loans and technical assistance in 2022-2023, helping to identify key challenges and measures. Their policy recommendations were presented at the Inter-Agency Transport Commission meeting in August 2023 for consideration in future National Transport and Logistics Strategy action plans. These recommendations – which inform the ongoing discussions but are not being adopted in full – target regulation, governance, restructuring and debt management. The proposed actions focus on the following areas:

• Corporate governance: Split Georgian Railway into three entities for infrastructure, freight and passenger operations.

• Financial sustainability: Address legacy indebtedness by using instruments such as green bonds or Eurobonds to refinance high-cost debt, reset coverage ratios for profitability and debt service and ensure that public service obligations are managed prudently.

• Operational efficiency: Trim the workforce by 3 000 to 5 000, with decisions on staff cuts made by an independent board.

• Demand-driven services: Align freight and passenger operations with market needs and public service obligations.

• Strategic and legal frameworks: Strengthen regulation and oversight by enacting laws that clearly define the roles, responsibilities and powers of a public rail regulator, and by establishing a legal basis for monitoring its safety, finances and operations.

• Debt and subsidies: Restructure or retire legacy debt and provide fiscal support for loss-making services and maintenance.

• Equal treatment: Promote fair competition between rail and road freight.

• National development alignment: Align reforms with Georgia’s growth and public finance objectives.

Reforms also focus on EU compliance, requiring legal separation of infrastructure, freight, and passenger services to prevent cross-subsidisation. Going forward, the government will directly subsidise passenger rail under public service agreements. Additional measures include updated safety standards, driver and locomotive certification and new protocols for transporting hazardous goods.

Russia’s large-scale invasion of Ukraine has shifted cargo flows from the northern corridor through Russia to Georgia’s middle corridor10, boosting its role in Eurasian trade. Transport volumes rose more than sixfold from 2021 to 2022, with trucks absorbing most of the growth and rail cargo up by more than 20%.

This surge coincided with the major infrastructure investments outlined above. Georgia spent more than USD 1 billion per year on transport infrastructure from 2023 to 2024, with similar levels planned for 2025-2026. The spending has gone primarily to road upgrades, the East-West Highway, and rail, as well as pipelines and airports.

Maritime trade is also up, though constrained by the lack of a deep-sea port. A project to expand the capacity at the Port of Poti – which currently handles 80% of Georgia’s containers – is planned, pending a final investment agreement, while the Port of Batumi serves smaller ships that can carry up to 40 000 deadweight tonnes (DWT). Most Georgian port traffic involves even smaller vessels (less than 20 000 DWT).

A deep-sea port at Anaklia, intended to handle larger cargo volumes and backed by international lenders, was planned in the 2010s, but the project collapsed amid protracted litigation that has continued into 2025. The government eventually sought new partners but insisted on retaining a majority stake. In May 2024, a preliminary deal was struck with a Chinese-Singaporean consortium, granting Georgia 51% control. After multiple rounds of clarifications and revisions, negotiations with the consortium over project financing are still ongoing, and the search for a private partner continues. In parallel, the government has secured a contract with a Dutch partner for preparatory works for the design and construction of marine infrastructure – including dredging and a breakwater. These preparatory works began in September 2024.

Expanding multimodal hubs could enhance efficiency, storage capacity and resilience in Georgia’s domestic and regional cargo transport. In addition to investments in multimodal hubs, planners are exploring freight “transloading” – directly loading trucks onto railcars to speed movement along the east-west corridor and give long-haul drivers the opportunity to rest. With financing secured and construction set to begin, the Anaklia deep-sea port could further boost freight along the middle corridor linking Asia and Europe.

Rail modernisation, better regional connectivity and new ports promise economic and trade benefits. The impact on greenhouse gas (GHG) emissions is less certain, depending on truck efficiency and the pace of rail and maritime growth. To maximise benefits, investments should prioritise digital technologies, rail and truck electrification, and multimodal integration – supporting future trade growth while limiting fossil fuel use and environmental damage.

Rising incomes and the spread of car financing models have caused car ownership to quadruple since 2000. Georgia has seen rapid motorisation in the post-Soviet, and, as in other emerging-market economies, car ownership closely tracks household income growth. Income per capita increased more than tenfold between 2000 and 2023, driving up car ownership more than fourfold to 230 vehicles per 1 000 people – from roughly 51 per 1 000 previously11. By comparison, this is slightly above China (213 cars per 1 000 people) but still less than half the rate in France (570 per 1 000).

In the wake of the 2008 global financial crisis, Georgian banks began offering structured car loans, which covered 15% to 40% of vehicle sales. Loans for hybrid and EVs were introduced in 2012, and by 2016 had evolved into EV-specific products with no down payment and lower interest (annual rates of 11% compared to 20% or more for other loans).

Vehicle imports and re-exports have grown more than fivefold, to USD 3.3 billion. Vehicle trade is a major economic activity in Georgia: passenger cars are the largest goods import by value, and re-exports of cars rank second in terms of exports. Most come from the United States (58% in 2023), followed by Japan (18%) and Germany (10%), as well as Türkiye, the United Kingdom, South Korea and other European countries. Many cars are re-exported to Kyrgyzstan (19%), Kazakhstan (18%), Azerbaijan (13%), Armenia (9%), Ukraine, Russia and the United Arab Emirates (UAE).

Most net car imports are used vehicles. Between 2017 and 2023, new cars made up 6% to 12% of net imports by volume (9% in 2023) and between 16% and 32% by value. In 2023, about 25% of new vehicle imports were hybrids and 6% were EVs; electric cars made up only 1.5% of overall imports. The rest run on gasoline (41% to 68%) or diesel (8% to 15%), with some gasoline cars converted to compressed natural gas (CNG) or liquefied petroleum gas (LPG). Many used internal combustion and hybrid vehicles enter the country via insurance auctions of salvage or damaged vehicles. Used EVs are seldom imported this way, however: they are typically used cars that are imported either privately (e.g. by individuals or small businesses) or through dealers or importers.

China has recently emerged as the top exporter of new EVs to Georgia, with exports reaching USD 9 million by value in 2022 and USD 14.7 million in 2023. While Chinese EVs accounted for just 0.5% of total vehicle trade in 2023 (around USD 3.3 billion), their affordability is expected to drive a growing share of imports in Georgia (as in other emerging markets and developing economies) over the coming decade.

Other vehicles (e.g. motorcycles, buses and trucks) account for 10% to 15% of gross imports by value and volume. Top exporters are Germany (28%), China (13%) and Japan (12%), with 20% to 30% of these vehicles destined for Armenia, Azerbaijan, Türkiye, Kyrgyzstan and Kazakhstan.

Higher import duties, stricter pollutant emissions standards and rising incomes are driving imports of newer models. Increased vehicle import duties, together with stricter emissions standards (both are discussed in more detail later in this report), have significantly lowered the average age (by model year) of Georgia’s vehicle imports. The median age of registered vehicles was just under 14 years in 2023, down from around 20 years in 2017.

Transport accounts for 30% of final energy use. With a more than tripling of the car fleet and a doubling in the truck fleet since 2000, transport final energy use increased almost fivefold between 2000 and 2022. The sector’s share of final energy demand nearly doubled, from 16% in 2000 to 33% in 2023.

Road transport accounted for 81% of Georgia’s total transport energy use in 2023, down from more than 90% before 2017. This decline reflects a fourfold increase in pipeline energy use as natural gas and oil transport volumes increased. Since 2017, pipeline gas use has accounted for about two-thirds of transport’s natural gas consumption.

Transport has generally been the largest sectoral consumer of final energy, accounting for just over 30% in recent years, although the residential sector briefly surpassed it in 2020-2021 during the Covid-19 lockdowns. Passenger transport peaked in 2019 before falling by more than a third in 2020. Road energy use dipped below 2019 levels in 2020-2021 but had surpassed them again by 2023.

Per capita transport energy consumption grew fivefold, from under 4 gigajoules (GJ) in 2000 to more than 19 GJ in 2023. This was 73% higher than China (11 GJ per capita), while it was just 70% of French (27 GJ), and one-quarter of US (78 GJ) consumption, respectively.

Transport’s share of energy-related emissions has more than doubled – to 42% in 2023 from 20% in 2000. Transport emissions have risen steadily, making the sector a major source of Georgia’s fuel combustion CO₂12 – accounting for more than 40% of total energy-related emissions13 over the past decade. Road transport dominates, accounting for more than 92% of transport emissions, driven mainly by vehicle fleet growth and increasing road freight. A sharp drop in power generation emissions between 2000 and 2001 also raised transport’s share to 33% from 20%.

Transport emissions grew fivefold from 2000 alongside rising energy demand. The increase in direct CO₂ emissions was smaller, reflecting a shift from oil products to natural gas, which emits less CO₂ from the tailpipe but has higher overall well-to-wheel GHG emissions than gasoline or diesel.

Despite some limited domestic crude production, Georgia relies almost entirely on imported oil products and natural gas. Imports of crude oil and oil products totalled roughly USD 1.3 billion in 2024.

Transport consumes about 80% of oil products, up from 50% in 2000, amid a collapse in demand from industry and households (-85%). Road fuels dominate, with consumption of gasoline (43.8%) and diesel (nearly 41.4%) representing more than 85% of total demand, followed by bitumen (9%), LPG (4.2%) and lubricants (1.5%).

Around 1 400 gasoline and diesel stations currently operate in Georgia, of which 400 are managed by four companies: Rompetrol Georgia, SOCA Georgia Petroleum, Gulf Georgia and Wissol Petroleum. Rompetrol, active across the Black Sea region, accounts for nearly half the retail fuel market.

Domestic crude oil production has shrunk tenfold since its peak in the early 1980s and can meet only a fraction of demand. Since 2022, around half of Georgia’s oil product imports have come from Russia, with Bulgaria, Romania, Azerbaijan and Türkiye supplying most of the rest.

Georgia’s imports of automotive gasoline and diesel from Russia spiked in 2021-2023. For the first time in a decade, Russia supplied over half of the country’s imported gasoline by value and more than 60% of its diesel in both 2022 and 2023.

Natural gas is also almost entirely imported – mainly from Azerbaijan but increasingly also from Russia. It is used across sectors, with road transport accounting for a share that has dropped sharply, to 6.8% in 2023 from over 20% in 2014. Coal production has dropped by nearly two-thirds, while consumption has fallen by a third since 2013.

Georgia aims to reduce its dependence on foreign energy through domestic refining, energy efficiency and renewables development. It is pursuing this goal through investments in energy efficiency and renewables (mainly biofuels), import diversification, domestic resource exploration, and expanded gas storage. In August 2024, the government approved construction of the country’s first refinery in Kulevi, near the Black Sea oil terminal, with an initial capacity of 22 000 barrels (22 kb) per day and plans for expansion. The project, aimed at reducing reliance on refined product imports, aligns with Georgia’s National Energy and Climate Plan, which prioritises attracting investors to develop a refinery on the Black Sea coast.

Georgia is rich in hydropower and biomass resources, as well as solar and wind potential. The country has abundant renewable energy resources, including rivers for hydropower and forests for biomass. Renewables, mainly hydropower, supply about 80% of its electricity14, making the power mix among the world’s least emissions-intensive. Policy makers have identified expanding wind, solar and geothermal energy as a key priority for climate, energy and energy security goals.

Hydropower generates most of Georgia’s domestically consumed electricity, with substantial potential for additional capacity. Its hydroelectric potential is estimated at 50-60 terawatt-hours (TWh) annually, of which barely 20% is harnessed by roughly 100 plants. Hydropower provides 75% to 80% of domestic electricity, giving Georgia one of the world’s lowest emissions intensities: between 80 and 120 grams of carbon dioxide per watt-hour (gCO₂/Wh) on a final energy basis15. This is less than one-fifth the global average, which stood at 500 gCO₂/Wh in 2024. Despite high transmission losses, Georgia’s power mix is very low-carbon. Transmission system upgrades could provide a cost-effective way to improve system reliability and resilience, and would help to further reduce the carbon intensity of electricity use.

Seasonal swings creates winter import dependence (when hydro output is low and heating demand high), while summer surpluses allow for exports. Since 2008, electricity use has closely tracked real GDP growth.

Planned investments include two new hydropower stations, adding 87.7 megawatts (MW) of generation capacity by 2026 and a further 63 to 100 MW by 2030, which is later than originally planned. The 2021-2023 Climate Action Plan also calls for a 200 MWh battery project at the Ksani substation by 2026, construction of a combined-cycle gas plant beginning in 2026, and more than GEL 2 billion (about USD 745 million) in investment to modernise transmission infrastructure.

Nearly 45% of Georgia is forested, storing in its biomass about 40 PJ of primary energy. In 2023, biofuels and waste made up more than 16% of domestic primary energy production but only 3.7% of total supply due to heavy reliance on imported coal, oil and gas. As recently as 2018, almost half of households – mostly in rural areas – relied on fuelwood for heating and cooking.

Unsustainable harvesting has increased landslides, flash floods and biodiversity loss, and lowered CO₂ sequestration. With increased access to gas and electricity, reliance on fuelwood is declining – but timber demand has risen since Russian exports have come under Western sanctions.

According to 2014 estimates, Georgia’s sustainable biomass potential totals around 10 PJ. This includes about 7.6 PJ annually from agricultural residues, 1.8 PJ from forest management, 0.3 PJ from sawmill dust, and up to 1 PJ from energy crop plantations. Recent forest management efforts cover 270 000 hectares and promote natural renewal on 3 150 hectares, with expected emission reductions of over 3 million tonnes of carbon dioxide (MtCO₂) by 2030.

Based on a resource potential survey, onshore wind could generate 8 to 10 TWh annually, with the most suitable sites offering about 4 TWh. Currently, one wind plant produces less than 100 GWh (<1% of electricity). Another 28 MW of capacity is under construction and due by 2026, but 300 to 400 MW planned under the 2021-2024 climate plan has been pushed back to 2030.

Georgia enjoys between 250 and 280 sunny days per year. Abundant sunshine and affordable equipment make small-scale residential and commercial solar water heating units common. In 2022, six solar farms totalling 93 MW (and annual output of around 132 GWh) were approved. A further 68 MW is planned for 2026 and 6.8 MW for 2030.

Electric vehicles (EVs) offer significant benefits in Georgia due to abundant hydropower and low electricity prices. The greenhouse gas emissions benefits of battery electric vehicles (BEVs) as compared with conventional gasoline or diesel cars are clear even in fossil-dependent countries such as China, but they are particularly evident in a country like Georgia. With Georgia’s low-emissions electricity – which has a CO2 emissions intensity of less than one-fifth the global average – a BEV driven 15 000 kilometres per year emits roughly one-quarter to one-sixth the CO2 of a comparable gasoline car.

EV operating costs are around one-sixth those of conventional vehicles. With gasoline at the pump costing around USD 1.20 per litre and residential electricity at around USD 0.08 per kWh, energy costs per kilometre for a battery electric vehicle (which consumes around 0.2 kWh per kilometre) are about one-sixth of a conventional car (which burns roughly 8 litres of gasoline per 100 km). Even with occasional high-rate direct-current (DC) fast charging (which can cost as much as 0.80 per kWh), energy costs for EVs remain lower on a per kilometre-travelled basis. EVs cost about half as much to maintain as ICE cars, thanks to simpler powertrains, regenerative braking and the absence of oil and filter changes.

Higher upfront costs for EVs remain a hurdle, but falling battery prices are set to narrow the gap quickly. Although EVs have lower fuel and running costs, their higher purchase price means it typically takes four to eight years in Georgia to recoup the upfront premium over conventional cars16. However, with falling battery prices and the arrival of more affordable small Chinese models, EVs – especially in the compact segment – are likely to reach upfront purchase price parity in the next few years.

Georgia faces transport challenges common to many countries: cutting local pollutants and greenhouse gas (GHG) emissions17, improving access and affordability, easing congestion and reducing road fatalities. The past decade has brought improvements in fleet safety and cleanliness, but further action is needed to address congestion, air quality and collision risk.

New and tougher regulations, along with incentives and taxes linked to vehicle efficiency and emissions, are needed to boost adoption of cleaner, more efficient vehicles, including EVs. Stricter rules, fines and tighter enforcement of the existing fleet are also required.

Meanwhile, boosting public transport, walking and cycling in major cities could yield substantial economic, health and societal benefits while reducing local pollutants and emissions.

Air quality remains a major public health concern in Georgia. Recent estimates attribute 130 premature deaths per 100 000 people annually to ambient and indoor air pollution – the second-highest rate in Europe after Serbia. The economic cost of this health burden is estimated at around 3% of Georgia’s GDP.

Outdoor air quality indices, which measure annual average fine particulate matter (PM2.5) concentrations, ranked Georgia 62nd of 134 countries in 2024. Transport is a key contributor, especially in cities, where road vehicles emit significant PM, nitrogen dioxide (NO2) and carbon monoxide (CO)18. In Georgia, road transport accounted for more than 40% of NO2 and 6% of PM emissions in 2023, contributing to an estimated 250 premature deaths annually, or around 5% of total deaths attributed to outdoor air pollution.

PM concentrations regularly breach World Health Organisation (WHO) limits in Georgia’s four largest cities and along major highways, while NO2 levels occasionally exceed safe thresholds, hitting the urban poor hardest. Seasonal factors – including transport dust and winter household heating – also influence pollution levels. Evidence from Covid-19 lockdowns shows that reductions in vehicle activity led to noticeable drops in NO2, highlighting the role of transport in urban air pollution.

Georgia has made considerable progress in the past decade in monitoring and addressing air pollution. The country has revised its air quality legislation to comply with the 2014 EU Association Agreement19 and the 2008 EU Ambient Air Quality Directive20, including pollutant emission limits shown in the table below.

Key legislative changes cover technical regulations, measurement protocols, public reporting (via air.gov.ge) and industrial emissions reporting. Challenges persist in monitoring and enforcement, owing to limited digital equipment and the selective use of air filtration during site inspections.

An electronic platform documents stationary sources and annual emissions (emoe.gov.ge), and an interactive, public-facing portal provides real-time updated information on air quality and other environmental indicators (map.emoe.gov.ge). The law requires classifying “zones and agglomerations” for air quality monitoring and requires those who exceed limits to develop emission-reduction plans. In 2021, MEPA identified monitoring zones and drew up remediation plans for Tbilisi and Rustavi, but implementation has been delayed by legislative changes and scheduling conflicts.

Air quality monitoring and mitigation plans were updated for the Tbilisi Agglomeration (2024-2026) and for the central zone that includes Rustavi (2023-2025). A new plan was also developed for the Black Sea zone that includes Batumi. In all cases, efforts concentrate on the transport sector, particularly in Tbilisi and the Black Sea zone.

Carbon dioxide emissions from Georgia’s transport sector have risen almost fivefold since 2000, driving nearly 60% of the increase in national CO₂ through 2023, and bringing the sector’s share of direct fuel-combustion emissions to 42%.

Georgia’s 2024 National Energy and Climate Plan (NECP) commits unconditionally to cutting total GHG emissions – including land use, land-use change and forestry (LULUCF) – by 35% from 1990 levels by 2030, a target that aligns with Energy Community accession. The NECP also includes a commitment – conditional on international support – to reducing emissions between 50% and 57% from 1990 levels over the same period. In recent years, the energy sector has accounted for 60% to 65% of GHG emissions (excluding LULUCF), with transport responsible for roughly 40% to 45% of that.

Georgia’s draft 2025 NDC update sets a new conditional 47% reduction in GHG emissions as compared with a 1990 baseline. Neither document contains a separate sub-target for GHG emissions from the transport sector, but two measures included in the 2025 draft NDC update are relevant to transport:

• Increase renewables’ share in electricity generation to 87% (from 75-80%).

• Ensure hybrids and EVs make up at least 25% of the vehicle fleet.

It is unclear if these steps will suffice to meet the 2030 target. As this deadline approaches, Georgia must also set 2035 targets that balance the urgency of cutting emissions with what is realistically achievable, coordinating long-term planning across government, business and civil society.

Car ownership has surged in Georgia’s capital, Tbilisi, worsening traffic, especially at peak hours. This is despite lower per capita car ownership than in many Western European capitals, suggesting that smarter road design, integrated transport planning and intelligent systems could help ease congestion.

Expanding road capacity is counterproductive. Building roads makes them more attractive to users who did not previously drive. Combined with naturally rising shares of car ownership, any added capacity is quickly absorbed. The term used to describe this well-documented phenomenon is “induced demand”: Short-term improvements tend to encourage more car use, entrenching new travel habits and discouraging use of alternative modes, until congestion returns – or even worsens – further increasing travel times.

The economic costs of congestion stem mainly from lost time, which reduces productivity and raises costs for individuals and businesses. Travel-time values are typically estimated as fractions of average income or GDP per capita, adjusted by trip type, mode and context. Assuming economic valuation ratios21 for different trip types, modes and traffic conditions from European valuation studies, and using the 2021 average gross wage in Tbilisi – GEL 7.50 (USD 2.80) per hour – and current mode shares of 30% car and 30% bus22, Tbilisi residents spent an estimated 221 hours in cars and buses, on average, in 2021.

Value of time-based cost estimates of congestion for vehicular travel in Tbilisi

This translates to about GEL 1 670 (USD 620) per person annually. Citywide, the inflation-adjusted cost totals GEL 1.8 billion (USD 670 million), or roughly 3% of Tbilisi’s GDP – consistent with other congested capitals. These losses highlight the urgency of tackling congestion through infrastructure upgrades, stronger public transport and smart traffic management.

In 2017, a stricter license-point system, with deductions for infractions from the basis of 100 points, was also introduced. In the same year, Georgia also mandated the use of speed governors on minibuses, buses and trucks. Vehicles operating abroad were required to comply in 2018, while those used only domestically were only required to meet the standards from September 2020. These regulations, along with mandatory and more frequent roadworthiness checks, helped cut fatalities from 13.9 deaths per 100 000 people in 2017 to 11.7 in 2024. Yet the rate remains more than double the EU average of 4.4 deaths per 100 000, and is also twice the average among members of the United Nations Economic Commission for Europe (UNECE), a group that includes developing and emerging countries.

Tbilisi’s road redesigns show how safety measures can also improve efficiency and cut emissions. Lower highway speed limits and smoother city traffic bring benefits across all three goals. Key urban options include:

• Smart traffic management (with speed enforcement and improved flow systems)

• Safer road design (separated bike lanes, at-grade crosswalks with signals instead of underpasses, and complete streets)23

Clear signage, context-appropriate traffic rules and strong enforcement remain essential everywhere – in cities, on highways and in Georgia’s towns and villages.

Georgia developed a National Road Safety Strategy 2022-2025, which was approved in mid-202224. The strategy includes measures to improve road safety management and vehicle standards, driver and road-user behaviour, as well as post-accident response, while more broadly aiming to develop safer roads. It incorporates procedures for implementation, monitoring and evaluation, as well as public communication, with a summary report to be developed in 2025.

A Road Safety Action Plan 2024-2025 was adopted by the government of Georgia in May 2025. It states further education on the dangers of drunk driving and the importance of seat belts; identifying and redesigning dangerous roads and intersections; lowering speed limits in urban areas and on highways; tightening the tolerance on speed governors from 15 kilometres per hour to between 3-5 kilometres per hour; and introducing periodic technical inspections for motorcycles. The UNECE further recommends the creation of a national lead agency and an inter-agency commission for road safety.

Recent political and policy reversals in several democracies highlight the need for climate, energy and transport policies that explicitly consider disadvantaged groups – including those likely to support parties that later roll them back.

Sustainable transport is no exception. Higher taxes on vehicles or fuels, stricter inspections and incentives for low-emissions alternatives (like EVs) must spread benefits widely and deliver visible gains, even within short electoral cycles. Near-term rules should target high-value use cases such as government or commercial fleets. When applied broadly (such as fuel efficiency or emissions standards), they should form part of policy packages that compensate lower-income groups or give them affordable alternatives. Examples include “right to plug” laws in five EU states, France’s “social leasing” program, and a growing number of national and subnational EV subsidies with income or price caps, such as the US Inflation Reduction Act, France’s Bonus Écologique and Germany’s buyer’s premium, as well as purchase incentives for second-hand EVs.

Public input is vital. National- and city-level policies should be conceived with civil society inputs and should undergo periods of public comment. This has not always been the case in Georgia, where municipal transport plans have often catered to demands of international financial institutions, rather than local constituencies. The latest example of this is the Tbilisi Transport Plan, which is only available in English, and which relies on technical studies that have not been made publicly available. At the same time, public recourse and inputs into energy and transport projects must be weighed against the risk of key projects being blocked by small yet powerful constituencies, including through administrative hurdles and legal tactics such as environmental reviews.