It is very common for investment promoters to declare that their particular location is at a crucial 'crossroads', meaning geographically rather than metaphorically in most cases, and maps are handily produced showing circles emanating outwards from the location thereby illustrating how central it is to global commerce and transport. Some of these claims are more plausible than others. As a region the Caucasus has a fairly justifiable argument as a crossroads location, connecting as it does Europe with Asia and enjoying close proximity to the Middle East as well. However, the transport links, to say nothing of sensitive political boundaries, tend to mean that such claims ring hollow.

Geopolitics are difficult to overcome, but the nuts-and-bolts work of improving infrastructure could come first – and why not start close to home? The republic of Georgia is just the sort of place with a ‘crossroads’ position on the map yet bedeviled by difficult relationships with neighbouring countries, most notably with the giant to the north, Russia. However, its capital Tbilisi is pressing on with local transport upgrades and other initiatives to make the city a regional magnet for investment. Making roads and rail crossings a bit more seamless within the city is a reasonable enough place to start.

Ambition on track

Mayor Gigi Ugulava sees the Tbilisi Railway Bypass project as being central to the city’s wider ambitions as well as improving the quality of life for residents and visitors by reducing environmental issues and traffic congestion. The project involves the construction of a 27-kilometre long double-track electrified railway line bypassing the city centre and joining up with the existing Kakheti railway line near Lilo. From the junction point at Lilo towards Tbilisi, the Kakheti line will be upgraded to double track on a length of 10 kilometres by refurbishment of the existing single track and adding a second new track. The railway infrastructure between the stations of Didube and Navtlugi will be dismantled, freeing up about a large swathe of land for urban development.

“The international railway routes will cross the entire city. The bypass is under construction and the land will be free for development. We have already announced the tender for this and for the railway, and the French company Apur is working on the masterplan. We see this as part of the ‘new city’ in this city,” says Mr Ugulava.

“There are three main stations at this point. The central one will be removed, but the rest will remain, because they provide the eastern and western connections. Both of them have connections with public transport, such as the metro, so from that point of view passengers will not be excluded from the railway.”

Speedy development

But there are bigger plans afoot. “Another issue is the development of the entire railway system,” continues Mr Ugulava. “In three years, it will be possible to get from Tbilisi to Batumi [on Georgia's Black Sea coast] in three hours. We will have high‑speed railways by our standards, although they will not be as fast as the ones in Europe. This is important for development and tourism, and for many reasons.”

The mayor has been promoting the transport and other projects (many in the tourism sector, such as resort developments) at international trade fairs as private-sector participation is very much wanted. “All of these projects are open for investment,” he says. “We see the development of the projects as a kind of public‑private partnership. We are branding them, and trying to develop the public infrastructure, as well as the necessary infrastructure, such as roads and electricity.”

Greenfield foreign investment into Tbilisi marched steadily upwards throughout the 2000s, hitting a high point of more than $1bn in 2009 before declining slightly in 2010, according to investment monitor fDi Markets. The largest share of inbound projects comes from western Europe, followed by Asia-Pacific. Financial services has been the leading sector; and sales, marketing and support, and business services facilities have been the most popular activities undertaken in the city by foreign companies.

Hopes for tourism

Tourism certainly could be a grower for this charming, lively yet largely unexplored city – city leaders think so too – and it will benefit from the transport upgrades as well as other efforts to smarten up parts of the city. The eccentric, attractive Old Town is undergoing a facelift; the third phase of the ‘New Life of Old Tbilisi’ project – initially launched by Mr Ugulava in 2009 – was announced by city hall this spring and is billed as creating new jobs, rehabilitating deteriorated houses and historical districts, improving living conditions for the residents of Tbilisi, and enhancing economic activities.

Speaking at the fifth annual Local Economic Development Forum, hosted in Tbilisi in May, Mr Ugulava stressed the importance of the scheme to the city’s longer term development: “When we speak about economic development we all should keep in mind that the crisis has affected the world economy and Georgia is not an exception [to this]. New Life of Old Tbilisi is the challenge that must be accomplished against the crisis. There’s a big discussion all over the world about whether it is right that governments set particular incentives for the private sector; however, what we see now is that Tbilisi needs these incentives to further develop.”

Old Tbilisi is, to your correspondent's eye, already among the more appealing of old towns in Europe so renovation should only add to its appeal to tourists in time, making it perhaps a crossroads for travellers in the Caucasus.