Financier Nikoloz Shurghaia explains the reasons of a 30% decline in FDI. According to him, new money is no longer actually coming into the country, and companies mostly make reinvestments.
“88% of investments were reinvestments. Out of the $1.3 billion in investments, only $160 million is new investment. Last year it was twice as much, when we had $1.9 billion in FDI. Of this, $310 million was new, so the inflow of new money has decreased by half.
If we look at the reinvested money, $500 million is actually the profit of two large banks, which was not distributed as dividends and remains in Georgia. New money is not coming in, and the inflow of new money is significantly decreasing. As a result, our investment profile and attractiveness have worsened. If the situation improved in the fourth quarter, it means that banks had more profits.
The only small positive sign in the whole picture was that investments in energy increased, but even that is nothing, because there was a big drop last year and a significant decrease compared to 2021 and 2022,” Nikoloz Shurghaia said.
According to Geostat, FDI in the energy sector increased last year. A total of $126.5 million was invested in this sector last year, $82.2 million more than in 2023.
