On 18 May, the World Bank (WB) released its report on “Green Growth” in Georgia, which estimated losses associated with pollution and degradation of agricultural and forest land and coastal zones. 

According to the report, the direct economic impact of land degradation in Georgia was estimated at 0.7 percent of national GDP in 2018, which emphasises the importance of mitigation actions. A high level of land degradation is caused by the absence of an integrated approach, extensive land use and a lack of investments. The adverse effects of this impact both land and water users, and the biophysical conditions of landscapes, resulting in stagnant agricultural productivity, which is lower in Georgia than in any other country of the former Soviet Union. 

The coastal systems in the country had also been impacted by substantial environmental degradation. The economic cost of degradation in the eight coastal municipalities of Georgia is equivalent to 5 percent of the GDP produced in the coastal zone in 2018. The high economic cost of coastal degradation is associated with floods, pollution, loss of physical assets (including buildings, and transport and hospitality infrastructure) and damage to critical ecosystems (including beaches, forests, and river deltas). 

In terms of air pollution, the report underscored that Georgia has a chance to chart a different course in reducing air pollution, which continues to have significant impacts on human health. The annual mortality attributable to ambient and indoor air pollution in 2018 is estimated at about 4,000 people, corresponding to a welfare loss of US$560 million, which is an equivalent of 3 percent of national GDP in 2018. Annual average concentrations of fine particulate matter (PM2.5) were higher than those considered safe for human health. Emissions from transportation, and dust from construction and other fugitive sources pollute ambient air in cities.

The report further read that climate change impacts in Georgia are seen in temperature increase and reduction of precipitation, with significant variability from year to year. The risk to the population’s wellbeing from climate change is estimated at an equivalent of 1.5-6.6 percent of Georgia’s national GDP. The likelihood of severe droughts will increase, particularly for the central areas of the country. Frequent occurrences of extreme weather will result in increased landslides, floods, avalanches, and mudflows that will affect agriculture, water resources, forests, coastal areas, public health, and infrastructure. The southern and eastern regions are the areas expected to be hardest hit by high temperatures and prolonged heat waves. 

In terms of solutions to the challenges that Georgia in this regard faces, the WB recommended the path of sustainable and greener development, which would require a targeted mix of enabling policies, incentives, and public investments. Four key areas were highlighted in this regard, namely: 1) strengthening forest and landscape management; 2) sustainable development of the coastal zone; 3) pollution management; and 4) building a multisectoral approach to sustainable development, engaging the private sector and green recovery from Covid-19 pandemic.

The WB highlighted that Georgia would benefit from developing a “Green Growth Development Policy” that is climate-resilient and based on sustainable natural resource use, high productivity, and the circular economy. It further elaborated that the government of Georgia has an ambitious yet incomplete environmental agenda. On the one hand, a “whole-of-government” approach to sustainability would focus on low carbon development that creates jobs and provides co-benefits in reducing waste and pollution, congestion, and improving health outcomes. On the other hand, the approach would be aimed at protecting biodiversity and ecosystem services to sustain the natural resource base of the economy. 

The government’s policy would need to cover traditionally relevant “environmental” sectors (such as nature protection, pollution management, landscape, and natural resource management), as well as all aspects of public policy (such as taxation and subsidies, public procurement, infrastructure design and business development). The private sector would play an essential role in employment generation, and it is essential that a well-managed environment and reduced degradation are recognised as essential elements for a conducive business environment. This does not apply only to “green” natural resource-based businesses, but to all economic sectors of the country.