US DoS: 'Business and investment conditions are sound in Georgia'
In the statement Georgia is described as a small but open market country that derives benefits from international trade, tourism, and transportation. Photo: Nino Alavidze/Agenda.ge.
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Business and investment conditions are sound in Georgia, however, there is an increasing lack of confidence in the judicial sector’s ability to adjudicate commercial cases independently or in a timely, competent manner, read the 2021 Investment Climate Statements about Georgia published by the US Department of State.
Other companies complain of inefficient decision-making processes at the municipal level, shortcomings in the enforcement of intellectual property rights, lack of effective anti-trust policies, accusations of political meddling, selective enforcement of laws and regulations, including commercial laws, and difficulties resolving disputes over property rights", reads the statement.
The US Department of State says that the Georgian government 'continues to work to address these issues', and despite these remaining challenges, Georgia ranks 'high in the region as a good place to do business'.
In the statement Georgia is described as a small but open market country that derives benefits from international trade, tourism, and transportation.
The statement reads that the average growth rate of the Georgian economy was over 5% from 2005 through 2019, and its rankings have 'improved impressively in global business, governance, corruption, and other indexes', however the Covid-19 pandemic 'has reversed some of the past gains and has placed significant pressure on the domestic currency and local economy'.
The statement also reads that the US and Georgia work to increase bilateral trade and investment through a High-Level Dialogue on Trade and Investment and through the US-Georgia Strategic Partnership Commission’s Economic, Energy, and Trade Working Group.
The US Department of State says in the statement that transit and logistics are priority sectors as Georgia seeks to benefit from increased East/West trade through the country.
The statement mentions the Baku-Tbilisi-Kars railroad that has 'boosted Georgia’s transit prospects'. On the other hand the statement also mentions the Anaklia Deep Sea Port Project and reads that despite the government’s claim that it remains committed to the implementation of the project, 'investors and local business leaders doubt that commitment'.
Separately, logistics and port management companies in Poti and Batumi have started development and expansion of both the Batumi and Poti Ports. In 2020, logistics companies will complete two new terminal projects and a third will be underway – a multimodal terminal in Batumi and new terminals and increased storage in Poti", reads the statement.
In the end, the statement confirms the US support towards Georgia’s sovereignty and territorial integrity within its internationally recognised borders and does not recognise the Abkhazia and South Ossetia regions of Georgia as independent.
The World Bank, the Organization of the Black Sea Economic Cooperation (BSEC) and the government of Georgia have started consultations on 'bluing the Black Sea' to address marine pollution and provide Georgia with a valuable opportunity to integrate the Black Sea into the country’s strategies for climate adaptation and mitigation.
The European Union has published its Association Implementation Report on Georgia, which says that the country ‘continued steadily on its European path including in the challenging COVID-19 context’. The document published earlier today reads that Georgia ‘has remained committed to the implementation, obligations and undertakings of the Association Agreement, despite COVID-19 related challenges’.
The US State Department has called on the Georgian government to suspend the process of the appointment of judges to the Supreme Court, urging the authorities to implement the April 19 EU-mediated agreement which ended months of a political standoff caused by the parliamentary elections of 2020. The US State Department says that ‘comprehensive, transparent, and inclusive judicial reform’ must be carried out before the process can continue.
fDi Intelligence publishes report on investment potential of Georgia
News and FDI publication, fDi Intelligence, has published a special report titled 'Georgia Pushes its Boundaries – the Country is Positioning Itself as the Next Global Trade Hub', which overviews the investment potential of the economic sectors of Georgia and offers exclusive interviews with high officials from Georgia's economic team.
Georgian politicians have welcomed the 2021 Investment Climate Statements on Georgia published by the US Department of State today. Georgian Economy Minister Natia Turnava said that according to the statement the decisions made by the Georgian economic team contribute to the improvement of the investment environment and make all sectors of the Georgian economy attractive for foreign investors.
Following a 'much-improved' macroeconomic baseline, Fitch Ratings has revised the outlook on Georgia's long-term foreign-currency issuer default rating (IDR) to stable from negative and affirmed the IDR at 'BB'.
Georgian Prime Minister and Chairman of the government of the Autonomous Republic of Adjara Tornike Rizhvadze have announced five new tourism projects in Shuakhevi municipality, Adjara, with a total investment value of about 30 million GEL. Garibashvili said that implementing tourism projects of this type is 'vital for reviving the economy and attracting more tourists'.
Nikoloz Samkharadze, the ruling Georgian Dream (GD) MP who chairs the parliament’s Foreign Affairs Committee, says that Georgia remains on the top of the EU agenda and is regarded as an ‘important ally’ for the European Union.
The turnover received by the Georgian business sector increased by 4.9% (y/y) and amounted to 114.3 billion GEL in 2020, says the National Statistic Office of Georgia (Geostat). The value of production generated by the business sector increased by 2.7% (y/y) and amounted to 46.2 billion GEL. Large businesses made up the majority of total turnover (58.3%), followed by small businesses (23.8%), and then medium-sized businesses (17.9%).
Ryan Strategic Advisory has published a research paper on business process outsourcing (BPO) opportunities in Georgia, which reads that the country has come onto the outsourcing scene 'with a tight, targeted business services offering that is attracting the attention of executives across western demand markets'.