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PRESS RELEASE

More Than 45,000 Households in Georgia Will Directly Benefit From Road Improvements

July 3, 2014

The Third Secondary and Local Roads Project will help reduce transport costs and improve road management

WASHINGTON, July 3, 2014 – The World Bank Board of Executive Directors today approved an IBRD loan in the amount of US$75 million to Georgia for the Third Secondary and Local Roads Project (Third SLRP). The project builds on the ongoing Second Secondary and Local Roads project and complements other projects funded by the World Bank in the road sector.

The project development objectives are to reduce transport costs and improve the sustainability of road asset management in the secondary and local road network in the project area. The project consists of the following three components: (i) rehabilitation and improvement of secondary and local roads; (ii) capacity building and strengthening in local and secondary roads management; and (iii) road safety technical assistance.

This Third Secondary and Local Roads Project will bring important improvements to local road connectivity and reduce transport costs for citizens using the rehabilitated roads. This will help spur economic growth and rural development. It will also help create much needed temporary employment in rural areas,” said Henry Kerali, World Bank Regional Director for the South Caucasus.The primary beneficiaries are local residents, businesses and road users who will benefit from better access to markets and services, and safer travel. “

The Third SRLP will improve 200 km of key regional and local road sections, which will provide better access to three major towns (Telavi, Samtredia and Tsalenjikha), 126 villages and around 45,600 households, totaling a population of around 138,000 inhabitants. Most of these villages are located in the regions which are hard to access and with high poverty rates in several locations. It is expected that the project will also address the transport needs of low-income road users and promote local development in the target areas through greater access to economic opportunities.

The local population will benefit from direct and indirect local job creation, and the competitiveness of local businesses in the areas where roads are rehabilitated will be enhanced. This will positively impact the prosperity of the population with lowest incomes,” said Joseph Melitauri, Task Team Leader for the Project.In addition, the project will support the capacity building of local governments and the Ministry of Regional Development and Infrastructure in local road management, as well as explore an opportunity for the creation and use of micro-enterprises for routine maintenance of local roads.The project will also contribute to strengthening the capacity of road safety enforcement and emergency response in the project area.”

The Third SLRP is in line with the main directions identified in the current World Bank Group Country Partnership Strategy (CPS) for Georgia for 2014-2017. The CPS identifies two strategic pillars: (i) strengthening public service delivery to promote inclusive growth; and (ii) enabling private sector led job creation through improved competitiveness. The Third SLRP will contribute to both strategic pillars through (i) strengthening the effectiveness and accountability of the Ministry of Regional Development (MRDI), the  Roads Department (RD), and municipalities in the secondary and local roads sub-sectors, and (ii) providing infrastructure to facilitate growth. It will also support the creation of private sector led jobs during rehabilitation and improvement works on roads, as well as explore an opportunity for the creation of more long-term jobs in the maintenance of local roads. In addition, the Third SLRP will improve domestic connectivity and access to markets, reduce travel time and transport costs.

World Bank commitments to Georgia since 1992 total approximately US$ 2.26 billion.