The European Investment Bank (EIB) will provide €170m ($218.3m) to upgrade and rehabilitate the east-west highway in Georgia.

The highway links the country’s capital city Tbilisi and its Black Sea ports with neighbouring countries Turkey and Azerbaijan.

EIB vice-president Wilhelm Molterer said the east-west highway is a key transport axis in Georgia, which is of great importance not only to Georgia and its neighbouring countries, but also for the EU as a strategic transit route for road transport between Europe and Central Asia.

"Better transport links are crucial to improving Georgia’s economic cooperation with neighbouring countries and its other trading partners, strengthening the competitiveness of the region and increasing transport safety and capacity with positive consequences for the quality of life of the country’s citizens," Molterer added.

The funding will be used to construct 52km of new motorway between Samtredia and Grigoleti at the most western part of the east-west highway, as well as rehabilitate 16km of existing roads leading south from Grigoleti.

The east-west highway project loan, which marks EIB’s first funding in the transport sector, is its seventh loan to Georgia overall, raising its lending total to the country to €360m.

EIB has funded various projects related to energy and water infrastructure, as well as lent credit lines to indirectly support small and medium-sized companies in the country.