The decline in Georgia’s foreign direct investment is largely linked to lower reinvestment, Deputy Finance Minister Giorgi Kakauridze said during a parliamentary discussion of the 2027 budget. He noted that reinvestment was particularly high last year, which significantly boosted the 2025 FDI figure, while this year’s reinvestment has declined.
Kakauridze said the fluctuation is natural because companies may accumulate profits for a period before reinvesting them. “If reinvestment was high last year, it does not mean it will be the same this year,” he said.
He also argued that focusing only on FDI is misleading and that total investment should be considered. According to Kakauridze, investment has accounted for a relatively smaller share of GDP over the past two years, while consumption has increased. He said higher government capital spending should help encourage private investment.
Georgia’s FDI fell by 21% year-on-year to $750 million in the first half of 2026. In Q2, FDI amounted to $468.8 million, down by 23.2% year-on-year, with Geostat attributing the decline mainly to lower reinvestment. In 2025, reinvestment accounted for 84%, or $1.6 billion, of the country’s $1.9 billion in FDI.
