Georgian agency reveals main reasons for FDI decrease in country (Exclusive)
Baku, Azerbaijan, Sep. 30
By Tamilla Mammadova – Trend:
The main reasons behind the decrease of foreign direct investments (FDI) in Georgia are the completion of the gas pipeline construction project and the transfer of the ownership of several enterprises from non-Georgian to Georgian residents in the first half of 2019, Produce in Georgia Agency told Trend.
"In addition, the reasons also include diminished obligations, which is serving debts, vis-à-vis non-resident direct investors", said the agency.
As the agency noted, these circumstances coincided in time, and the decline in FDI is not connected to any fundamental factors or deterioration of investment climate.
"This is confirmed through the Fitch’s affirmation of Georgia’s sovereign credit rating at ‘BB’ with a stable outlook as a result of Georgia’s attractive business and investment environment", said representatives of the agency.
The agency also emphasized that the share of reinvestment in the total FDI is maintained high (approximately 34 percent in the first half of 2019) reflecting foreign investors’ positive attitudes and expectations towards Georgia’s business environment.
As reported, instead of repatriating corporate profit, they use it for new investments and expansion of their business activity, thus further increasing Georgia’s investment attractiveness.
The Produce in Georgia program was created in the summer of 2014 to stimulate local production and offers two main incentives: financial resources and infrastructure (land, buildings etc.). In April 2017, the agency of the same name was created, which combined all state programs aimed at promoting the business sector and economic development of the country.