Dynamics of foreign investments in Georgia in 2022: new data

The National Statistical Service of Georgia "Sakstat" has provided updated figures on the amount of foreign investment in the country for 2022. According to the updated data, the volume of direct foreign injections increased by 67.5% compared to the previous year and reached $ 2.1 billion.

The main driving force in correcting the data was a more accurate determination of reinvestment indicators and the volume of loans by several enterprises. According to preliminary information published in March 2023, initially investments in the country for 2022 were estimated at $97.9 million lower – $ 2 billion.

The increase in the volume of investment is explained by the expansion of the share capital of companies and the growth in the volume of reinvestments. In particular, an increase in investments was registered in the financial and insurance sectors, real estate, water supply and waste management.

The UK, Spain and the Netherlands remain the leaders in the direction of investing in Georgia. They made a significant contribution, accounting for 20.8%, 17.2% and 9.4% of the total investment, respectively. In addition, financial flows came from various countries, such as the USA, Ireland, Russia, the Czech Republic, Japan, Turkey and China.

An important trend is the growing interest in the financial and insurance spheres, real estate, as well as water supply and waste management. This is confirmed by the fact that the largest share of investments was concentrated in these industries.

It is also important to note the role of reinvestment in the economic dynamics of Georgia. In 2022, the volume of reinvested funds increased by 78.5%, reaching approximately $1.4 billion. This growth is due to the introduction of the so-called "Estonian model" of taxation. Georgia has exempted enterprises from paying tax on the part of profits that is reinvested in the development of production.

The Georgian government has also announced a new economic program aimed at actively attracting foreign investment. An important part of this initiative will be the new Law on Entrepreneurs, which will be aligned with EU norms, making Georgia's corporate law more in line with international standards.

Such steps underline Georgia's desire to create a competitive and business environment, as well as to make the country more attractive for foreign investment in the post-pandemic period.