OECD Investment Policy Reviews: Georgia

image of OECD Investment Policy Reviews: Georgia

Georgia’s reform trajectory has been nothing short of remarkable. In less than two decades, successive structural, regulatory and economic reforms have propelled Georgia from one of the poorest post-Soviet states to an upper-middle income economy. Georgia ranks among the best performers in the world according to international indices on doing business and openness to foreign investment – achievements many countries look to for inspiration. Yet in recent years, the Georgian government has reflected on why these reforms have not facilitated more broad-based economic growth. FDI attraction has been strong relative to the size of the Georgian economy, but the positive benefits of investment have not been fully realised. Mobilising investment in sectors that can enhance job creation, exports and productivity will be key for Georgia’s recovery from the COVID-19 pandemic. This Investment Policy Review takes stock of recent achievements in improving the investment climate and assesses areas for the government to consider in strengthening its reform efforts to attract FDI that can have a positive impact on inclusive, sustainable growth.


FDI trends and sustainable development impact

Georgia has succeeded in leveraging remarkable reforms and its strategic location to market itself as an attractive investment destination. But FDI inflows remain below potential and will be reduced by the COVID-19 pandemic. This chapter reviews recent FDI trends in Georgia, including the sectoral composition and origin of FDI. It also investigates how FDI contributes to key sustainable development priorities, including productivity, jobs, skills, gender equality and the greening of the economy.


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