The FINANCIAL — According to Irakli Matkava, Director of the Georgian National Investment Agency, the volume of foreign direct investments (FDI) in Georgia is expected to increase by 11% in 2010. Matkava says the sum of investment will reach 1.2 billion USD in 2010.
“The Department of Statistics has not yet released the exact volume of FDI in 2009 in Georgia. As for the countries that invested the largest amounts in Georgia in 2009, Egypt, the United Arab Emirates and Turkey are all on the list,” Matkava says.
The total sum of FDI in the third quarter of 2009 was 223,578.4 million USD.
In 2008 the largest number of investors in Georgia was from the United Arab Emirates, the USA, Turkey, the Virgin Islands, and Great Britain.
The total volume of FDI in 2008 was 1,563,963 billion USD. The number was 450 879 million USD higher in 2007 – 2,014,842 in total.
In 2007, the countries that invested the largest sums in Georgia were the Netherlands, Czech Republic, Virgin Islands, Denmark and Cyprus.
Matkava names industry, transport and communication fields the most attractive business sectors for foreign investors in the third quarter of 2009.
“The decrease of foreign investments in Georgia during 2009 was due to both the local political and global economical problems. 2009 was the hardest year for investments for the whole world. 85% of large scale companies put their investment plans on hold. It affected the whole world including Georgia. As for our domestic problems, all the projects that were interrupted because of the Russo-Georgian war have already been restored or will be in the nearest future,” Matkava declares.
Investment agency has no confirmed information about countries that will be active in terms of investments in 2010.
“According to global prognoses the most active are expected to be Indian and Chinese companies, also investment funds of countries of the Persian Gulf. We can predict that these tendencies will also concern Georgia,” he says.
“It is hard to talk concretely about further partnership with potential investors, before they have made the final decision to invest in Georgia, but currently we are in negotiations with Korean, Arabian and Chinese companies,” Matkava says.
“Georgia is attractive for investors if we consider the local legal environment and policy of the Government of Georgia towards investors. The only risk that remains for investors is the threat from its neighbouring country. However it is important to underline that international society together with the Georgian Government is actively involved in the stabilization process,” Matkava says.
“This is a positive signal for investors,” he says.
“Georgia occupies 11th place in the Doing Business rating by World Bank and IMF. A high ranking on the ease of doing business index means the regulatory environment is conducive to the operation of business. Our country is free from corruption; we have effective administration, liberal and deregulated economy. Georgia occupies fourth position in the Tax Misery Index – Least tax burden countries: Standard & Poor’s Index. Profitable geographical location, strong banking system, cheap working forces, free industrial zones… all these factors will continue to encourage foreign investors’ interest in Georgia,” Matkava notes.
Matkava underlines the huge potential in energy, agriculture, tourism, transport and communication sectors and industry, and considers them the most attractive business sectors for investors.
“Still the most popular and attractive business sector for investors will be determined by market conjuncture,” he says.
GNIA was established in 2002. It is the only government agency responsible for investment promotion and facilitation.
“Our agency is working in dual directions. Our first goal is to promote Georgia internationally, to advertise Georgia’s investment climate on international forums, and organise Invest in Georgia business forums, meetings, conferences and workshops. We are trying to introduce our country’s abilities to potential investors, to increase awareness of Georgia as an investment destination,” Matkava tells.
He notes that another aspect of their work means fostering public-private dialogue in order to build a better and more prosperous environment for private sector development and economic growth, supporting FDI and registering new foreign investments.
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