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GGM: Four Main Factors can Boost FDI Flows to Georgia

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Madona Gasanova
09.02.21 22:30
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Despite increased competition, Georgia's investment potential has not deteriorated. Turkish, Jewish, American and Dutch investors are negotiating their future investment projects with the management company GGM. Meanwhile, there is always a room for improvement and suggested four factors are believed to further increase attractiveness of Georgia as an FDI destination. 

“To maintain foreign investors’ interest towards Georgia, I will distinguish four main factors: strengthening state institutions and creating a stable political environment;  An independent court with a high degree of confidence; Intensifying actions on joining the EU and NATO; Rapprochement of Georgian and foreign business associations, chambers of commerce, financial institutions, business-related enterprises, and strengthening of cooperation. In this regard, it is very good that Georgia has recently joined the World Association of Investment Promotion Agencies (WAIPA). The more such news we have, the better,” Geno Geladze, CEO at Management Company GGM, told BM.GE.
 
One of the main directions of GGM is assisting enterprises or individuals seeking to invest in Georgia. The portfolio of the company incorporates foreign businesses and the management is well aware of their challenges in Georgia. 
 
According to Geladze, investors from many countries are interested in Georgia, which is due to several main circumstances. The main interest is the location of the country, natural resources, the ability to easily start a business and low taxes.
 
“We recently communicated with Turkish, Jewish, American and Dutch investors who have projects in Georgia or who want to invest. Despite the pandemic, work on investment projects is ongoing. This can be done online, it takes time, but it is important that the process of developing investment projects in various fields does not delay,” says the CEO of GGM. 
 
Amid the Covid crisis, virtually every country is trying to be more vigilant about the large business groups operating in its country so that they can rebuild their strengths and make new investments. In addition, probably all countries are trying to attract more interested companies operating in other countries to implement projects in their country. Despite increased competition, as Geladze says, Georgia's investment opportunities, which have attracted foreign investors over the past 20 years, have not deteriorated. 
 
“Recently, the Georgian government has become more active in this regard, and we often see them negotiating with investment groups from different countries and aiming to present the investment potential of the country in a positive way. This is really good,” he added.
 
Georgia has every opportunity to attract foreign investors, despite increased competition, believes the CEO of GGM, who also emphasizes an importance of a stable political environment. “When economic crisis is accompanied by political instability, it complicates the situation. Business (like any other sector) does not like political upheavals, and I hope that Georgia will be able to strengthen state institutions to a level where they, as institutions, have a high degree of trust both domestically and internationally.“ 
 
“Steps towards the EU and NATO integration will be successful in preparing the country. The closer we get to the EU and NATO, the more trust there will be towards our country, the country's image and investment potential,“ he added. 
 
Considering ongoing uncertainties on the global markets, Geladze finds it hard to predict which countries will be more active with investments to Georgia during 2021. “Perhaps, with the opening of the borders, at the first stage the greater interest will be from neighboring countries, and in the long term, we should logically expect interest from those countries that can easily overcome the economic crisis, adapt to new realities, decide to explore new markets and be ready to invest in other countries. We need to actively observe this process and communicate properly.”
 
As for the business sectors, “I expect investment activity in the energy sector, agriculture, tourism, construction, transport, communications, and the financial sector,” Geladze told BM.GE.