09.Oct .2020 13:27

Postponement of a large port project not a risk to FDI and Georgia’s business environment – Fitch Ratings

Postponement of a large port project not a risk to FDI and Georgia’s business environment – Fitch Ratings
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There still remains quite a bit of uncertainty with regards to the large port project but I don’t think the developments itself and perhaps the postponement of that project is risk to the FDI outlook for Georgia – this is what Associate Director at Fitch Ratings Kit Yeung told Elene Kvanchilashvili for The Checkpoints in an interview, which will be streamed next Sunday on BM.GE.

According to Fitch Ratings, the fact that the project is being postponed could be considered as a negative outlook, but certainly not a risk to Georgia’s business environment.

As Kit Yeung told The Checkpoints, Fitch Ratings on aggregate expects lower inflow of FDI in the country this year relative to last year due to weaker external environment; however, “going forward Fitch does see relatively strong recovery and FDI inflows around 4.8% of GDP next year, which should provide a relatively good coverage for the current account deficit which we expect to narrow next year” – Associate Director at Fitch Ratings stated.

Georgia attracted 1.3 billion USD through FDI in 2019. FDI in Georgia shrank by -41.7% YoY to USD 165.4 million in the Q1 2020. In Q2 2020 it reached USD 237.8 million up 0.5 per cent from the adjusted data of Q2 2019. “Increase in foreign direct investment once again confirms the effectiveness of our economic and anti-crisis policy and this is the response to those, who declare that investors are fleeing Georgia” – Minister of Economy and Sustainable Development Natia Turnava stated after the official figures were released.