Georgia’s foreign direct investment (FDI) remains low despite a year-on-year increase in the first quarter of 2026, according to economist Giga Bedineishvili. Speaking on BMGTV, he said the country’s investment performance remains weak relative to the size of the economy and its development needs.
According to Geostat, Georgia attracted $271 million in FDI in the first quarter of 2026, up nearly 48% from a low base of $184 million a year earlier. More than half of the inflows came from reinvestment by existing companies, while debt instruments and equity capital also contributed to growth. Bedineishvili noted that annualized FDI would likely reach around $1.5 billion this year, equal to only 2–2.5% of GDP, which he described as insufficient for a developing economy.
The economist argued that the main barrier to attracting new large-scale investors is the country’s political environment rather than economic growth or currency stability. He claimed that informal governance and concerns over judicial independence undermine investor confidence, stating that perceptions of political influence over state institutions remain a significant deterrent to foreign investment.
Bedineishvili added that rule of law and legal security are fundamental requirements for investors from all regions, including China and Russia. While individual large projects from Middle Eastern or Asian investors may still be attracted through targeted incentives, he said sustainable growth in FDI requires a broader base of smaller investments across multiple sectors rather than reliance on a handful of major projects.
