Logistics Performance Index of Georgia

The competitiveness of any international transport corridor is assessed by the logistics capabilities of each state included in it.

Any company involved in international transportation makes a decision on the selection of a particular corridor based on the Logistics Performance Index (LPI). The index (LPI) is a rating developed by the World Bank, the purpose of which is to help countries identify their shortcomings, challenges and their own capabilities in the field of international trade logistics.

According to the Logistics Index (LPI), the first place is occupied by Singapore, which is one of the main centers of global trade. Finland is in second place, and several countries – Denmark, Germany, the Netherlands and Switzerland – occupy the third place at once.

The Logistics Index assessment has been carried out since 2010 and is conducted every two years. The survey was not conducted in 2020 due to the pandemic. The last assessment was carried out in 2023.

The index is based on a survey of logistics market participants, i.e., shipping companies, in trading partner countries.

The country's logistics efficiency index is determined by six different criteria, which are ultimately evaluated by the total logistics efficiency index.

According to the logistics index indicators, over the past 10 years, the “Transport Corridor Research Center” offers analytics on Georgia's positioning.

The comparative study of the logistics index indicators covers the period from 2012 to 2023. The purpose of selecting this range is to clearly see the directions of improvement and lagging behind in Georgia's positioning in the logistics sector (see diagram).

Quality of infrastructure (ports, railways, roads) – Georgia ranked 58th in 2012, 108th in 2023 (decline of 50 places);

Efficiency of customs procedures – 44th in 2012, 77th in 2023 (decline of 30 places);

Ease of organizing international transportation – 91st in 2012, 85th in 2023 (improvement of 6 places);

Ensuring cargo surveillance – 93rd in 2012, 80th in 2023 (improvement of 13 places);

Delivery times for cargo to the destination – 115th place in 2012, 76th place in 2023 (improvement by 39 places);

Competence in implementing logistics processes – 70th place in 2012, 92nd place in 2023 (deterioration by 22 places);

Total logistics efficiency index – 77th place in 2012, 79th place in 2023 (deterioration by 2 places);

In conclusion, it should be noted that in the last 10 years, out of the six directions of logistics efficiency, Georgia’s positioning has improved in three components and also deteriorated in three components. Overall, over the same period, the total logistics efficiency index has deteriorated.

According to the National Transport and Logistics Action Plan of Georgia for 2023-2030, the Logistics Index (LPI) positioning target indicator is selected as <74th level in 2026, and <69th level in 2030.

Due to the deterioration of the 10-year positioning, improving the target indicators set by the state is a difficult task, to achieve which it will be necessary to develop a time-stretched, constantly adjustable action plan.

Of the six components considered, the quality indicator of infrastructure (ports, railways, roads) is distinguished, in which Georgia’s positioning has deteriorated by 50 positions in the last 10 years.

The significant lag in the infrastructure indicator is mainly due to the fact that Georgia's infrastructure is developing at a slower pace compared to other countries, which is consistent with the low inflow of investments.

It is important to emphasize that the infrastructure assessment indicator has deteriorated compared to the previous survey in 2018, namely, it has decreased from 2.38 to 2.3 points.

The infrastructure indicator is the most important component, where Georgia's 108th position with a score of 2.3 cannot be considered a satisfactory result for a country with logistical ambitions.

Georgia lags behind almost all countries in the region in terms of infrastructure, for comparison – Turkey – 43rd place, Armenia – 76th place, Kazakhstan and Tajikistan – 80th place, Belarus and Russia – 68th place, Uzbekistan, Kyrgyzstan and Ukraine – 89th place.

In fact, in terms of infrastructure, Georgia is only better than Moldova (132nd place).

As of 2023, Georgia is classified as a country with partial logistics capabilities with a score of 2.7. This significantly lags behind the indicator of countries with improved capabilities, which is evaluated in the range of 3.2 to 3.6 points.

In conclusion, according to the Logistics Performance Index (LPI), Georgia’s current positioning cannot be considered a satisfactory result for a country with ambitious logistics capabilities.

Info: transcor.ge