Issue 1, 2018. February-March


INVESTMENT NEWS provides a brief update on investments and changes in government policy that could impact the business environment. The information in this issue was taken from, a government supported website, and other sources.

Silknet to Set to Acquire Geocell
Internet service provider Silknet has reached a deal to purchase Geocell for $153 million, subject to the approval of the Georgian National Communications Commission. Silknet agreed on the deal with Geocell's shareholders, Telia Company and Turkcell.

Georgia Ranked 5th in World for Budget Transparency
The Open Budget Survey 2017 has ranked Georgia fifth out of 115 nations in terms of budget transparency, participation and oversight. Georgia's score was 82 out of 100, just three points below Norway. The top three countries were New Zealand, South Africa and Sweden. The score, which is based on an assessment of 119 indicators, indicates Georgia is becoming better in all three areas. The country's score for public participation - 22 out of 100 - indicated that more work is needed, the report said.

Georgia-China Trade Deal Goes into Effect
The free trade deal between Tbilisi and Beijing went into effect on January 1, opening a market of 1.4 billion consumers to customs-free Georgian wine, mineral waters, honey, tea, fruit, vegetables and agricultural products.
Trade between China and Georgia has been increasing over the years, especially the export of Georgian wine. In 2017, 7,585,407 bottles were exported to China, according to the Georgian National Wine Agency, a 43 percent increase from 2016 sales.

PM Names New Business Ombudsman
Georgian Prime Minister Giorgi Kvirikashvili has named Irakli Lekvinadze as the country's business ombudsman, the website reported on January 25. Lekvinadze previously served as a deputy mayor and as a vice president of the Association of Young Financiers and Businessmen.

Over 4 Million Passengers at Georgian Airports in 2017
In 2017, there was a 43 percent increase in the number of passengers who flew into Georgia's three international airports as compared to 2016. Over three million passengers traveled through Tbilisi International Airport, a 40.47 percent increase from 2016; similar increases were registered at Batumi International Airport (a 58.69 percent increase) and David Aghmashenebeli Kutaisi International Airport (a 49.31 percent increase). There was also an increase in passengers in rural airports: 72.19 percent at Queen Tamar Airport in Mestia, Svaneti region and 1,723 passengers were registered at Georgia's newest airport, Ambrolauri airport in Racha.

Exports Grew in 2017
Georgia's exports increased by 29.1 percent in 2017, according to Geostat, Georgia's national statistics body. The country's exports were worth $2.72 billion in 2017. Imports grew by 9.4 percent.

Government to Subsidize Youth Employment
The Georgian government has announced it will pay half the salary for young workers for the first four months of their employment, reported on January 16. The program, which started on January 15, has a budget of 700,000 lari (approximately $275,000), and will provide a monthly salary of no more than 470 lari per participant. The program requires the employers to offer the young workers a contract for a minimum of ten months; for six months the company is obligated to pay the entire salary.

Georgia Launches Automatic VAT returns
The Georgian Finance Ministry has started a new system to allow VAT returns in 5-7 days.
The system allows business owners to fill out an electronic application and avoid any additional bureaucratic hurdles. "As a result of the implementation of this reform in the next few years, an additional 600 million GEL will be available in the private sector, which will be an important stimulus for business development. This means that entrepreneurs will be able to reduce the cost of products, improve their quality and become more competitive," Georgian Finance Minister Mamuka Bakhtadze told journalists. Bakhtadze stated that the timely and simple return of VAT surplus without any bureaucracy-related challenges is "especially important" for small- and medium-sized businesses, reported.
U.S. State Department Classifies Georgia as a "Safe" Destination
Georgia has been given a level 1 rating by the U.S. State Department, the safest rating for international travel.
In the region, Armenia was also granted a level 1 rating; Azerbaijan was given a level 2 rating, which calls for "exercising increased caution," and both Russia and Turkey were given level 3 ratings, which mean the U.S. government recommends avoiding travel due to "serious risks to safety and security."