US State Department says Georgia “routinely ranks high” in international rankings for transparency, competitiveness, economic freedom
“In 2023, the economy grew 7.5 percent and inflation dropped to 0.4, marked by a return to more traditional economic drivers: tourism, increasing exports, and strong foreign capital inflows. Following three years of sustained growth, Georgia’s GDP is expected to continue this trajectory with 2024 forecasts between five and seven percent growth”, it added.Photo: Department of state.
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The United States Department of State on Wednesday published the 2024 Investment Climate Statements on Georgia, saying the country "routinely ranks high" on international rankings for transparency, competitiveness, and economic freedom with its "favourable" business climate.
The report said business and investment conditions in the country were “sound” and it compared “favourably” to regional peers. The Georgian economy continues to “perform well” despite the double shocks from the Covid-19 pandemic and Russia’s continued invasion of Ukraine in 2022, it added.
“The average growth rate was over five percent from 2005 through 2023. Fiscal and monetary policy are focused on low deficits, low inflation, and a floating real exchange rate. [...] Having recovered from the COVID-19 pandemic, Georgia’s economy rebounded in 2021, with 10.4 percent growth, and continued to outperform expectations in 2022 with 10.2 percent growth due to tourism revenues, a surge in war-related immigration and financial inflows, and a rise in transit trade through Georgia”, the report said.
“In 2023, the economy grew 7.5 percent and inflation dropped to 0.4, marked by a return to more traditional economic drivers: tourism, increasing exports, and strong foreign capital inflows. Following three years of sustained growth, Georgia’s GDP is expected to continue this trajectory with 2024 forecasts between five and seven percent growth”, it added.
However, the Department claimed there was a “continued lack of confidence” in the judicial sector’s ability to adjudicate commercial cases “independently or in a timely, competent manner”, with some business dispute cases “languishing” in the court system “for years”, adding the Georgian Government continued to work to address these issues, and despite the challenges the country ranked “high in the region as a good place to do business”.
The report also highlighted the US’s support for Georgia's sovereignty and territorial integrity within its internationally recognised borders, emphasising the US Government did not recognise the Russian-occupied Abkhazia and Tskhinvali (South Ossetia) regions of Georgia as independent.
The comments also noted that transit and logistics were “priority sectors” for the country, as Georgia “seeks to benefit” from increased east-west trade along the Middle Corridor, a logistics route connecting Central Asia and China to Europe via the South Caucasus, following Russia’s further invasion of Ukraine in 2022, and highlighted recent projects of Georgian Government aimed to boost the country’s economic directions.
“The expanding Central Asian market has also driven recent increases in cargo through the Middle Corridor connecting Europe to Central Asian markets and could be the source of long-term growth for Georgia, particularly with strategic infrastructure investments and regional cooperation. In February 2023, the Georgian government announced a new tender for the development of the Anaklia port, a deep seaport whose original tender the government cancelled in 2020. In March 2024, the government announced the international tender for the design and construction of Anaklia port’s marine infrastructure”, it noted.
The report also mentioned plans of the Georgian Government to build a new international airport for capital Tbilisi.