Investment News

Investor.ge provides a brief update on investments and changes in government policy that could impact the business environment. Information in this issue was taken from agenda.ge and other sources.

Remittances down 8.2 percent YoY in December
Remittances to Georgia from abroad hit $285.4 million in December, down 8.2 percent YoY, according to information released by the National Bank of Georgia (NBG) on January 15. Included in that figure was $128.8 million sent from European Union member countries, or 45.1 percent of the total volume, a month-on-month increase of 4 percent.
Among countries of the bloc, remittances from Italy topped the list at $50.9 million (+1.4 percent YoY), followed by Greece with $23.9 million (+3.9 percent YoY) and Germany with $23.5 million (+6.7 percent YoY).
Other top source countries of remittances were the United States ($55.3 million), Russia ($31.3 million), and Israel ($23.3 million).
Overall, 96 percent of total money transfers from abroad originated in 24 countries, with the volume of transfers from each exceeding $1 million in December. In the same month, remittances leaving Georgia totaled $34.8 million, compared to $32.3 million in December 2023.

Business confidence down in 2024
ISET-PI reported the latest figures from the Business Confidence Industry show a decline in confidence in Georgia. In Q4 2024, business confidence fell by 9.7 index points, dropping to 3.8. The sharpest decline was observed in the finance sector, which saw a decrease of 22.1 points.
The trend was credited to poor past performance and growing pessimism. The report notes that the expectation index, which measures business sentiment about upcoming conditions, fell to 7.0 points, with the strongest drops in the manufacturing (-40.0) and agriculture (-30.0) sectors.
In the same report, ISET-PI noted the drop in foreign direct investment (FDI) to Georgia: FDI in 2023 dropped 15.5 percent compared to 2022 and the trend continued in 2024. In the first nine months of the year, 966.3 million GEL were invested in Georgia from abroad, 39.9 percent lower than the same period in 2023.

Hotels report drop in reservations, increased cancellations
Major hotels in Tbilisi say the hospitality industry has suffered a major hit this season.
Mariam Pkhakadze, marketing and communications manager of the GMT Group (Tbilisi Marriott, Courtyard Marriott, and Moxy Tbilisi), told BM.GE that hotel occupancy rates are low compared to the same period last year.
“The current season has been quite difficult for the hospitality industry. Hotel occupancy rates have significantly decreased compared to the same period last year. We have challenges especially at hotels located on Rustaveli Avenue, in this case at the Tbilisi Marriott, the occupancy rate has practically halved. Courtyard Tbilisi and Moxy Tbilisi are working more stably at the expense of tourist groups and Indian groups, however, due to competition and market changes, price adjustments have become necessary,” she says.
“The dynamics of bookings are unstable… the final results will largely depend on the economic and political environment in the country.”
Pkhakadze says demand has significantly decreased from EU countries.
“Traditionally, our main guests are from India, the United Arab Emirates, China and the United States. This season, demand from Europe has significantly decreased. Regional tourists are more active, but more price-sensitive, so a flexible pricing strategy is needed,” she says.
Natia Goletiani, the manager of the Alpine Lounge Hotel & Restaurant in Kazbegi, told BM.GE the hotel has also seen a drop in guests from the EU. She noted that hotel occupancy dropped 10 percent in 2024 and the trend continues this year.
“This year, occupancy is about 30 percent. We are visited by tourists from Asia, including Korea and China, as well as Russia. Previously, tourists used to book hotels 3-4 months in advance and reservations began during the off-season, but now the trend changed and bookings begin 2 weeks in advance,” she says.
“We mainly work on direct and corporate bookings. It is worth noting that corporate bookings have also decreased.”
A recent report by Galt & Taggert found that tourist arrivals dropped after Q1 2024 due to political instability. The number of visitors from the EU dropped by 3.5 percent compared to 2023. Tourists from Israel and Russia grew in Q4 2024 by 136.1 percent and 15.4 percent respectively.

World Bank forecasts 6 percent growth for Georgia in 2025
Georgia is forecasted to grow by 6 percent in 2025, according to the latest Global Economic Prospects report from the World Bank released in January. For 2026, the country’s expected growth rate remains at 5 percent, unchanged from the bank’s previous estimate.
The report also offered a revised economic growth expectation for Georgia in 2024, putting it at 9 percent – an increase of 3.8 percent compared to its June 2024 forecast. This positions the country as having the highest average economic growth in the Europe and Central Asia region, with an expected average rate of growth of 6.7 percent from 2024 to 2026.

Georgia showcases startups at U.S. tech exhibition
Georgia made its debut at the Consumer Electronics Show, one of the world’s largest technology exhibitions, in Las Vegas this January. .
Georgian startups represented at the event included Klipy, Elven Technologies, Widgera, Stori AI, and Baasi.

Central bank holds interest rates at 8 percent
The National Bank of Georgia (NBG) on December 18 announced its Monetary Policy Committee’s decision to keep the refinancing rate unchanged at 8 percent, citing the year-over-year inflation rate of 1.3 percent in November, which it said remained below its target of 3 percent.
Core inflation was slightly higher at 1.6 percent. Prices for domestically produced goods and services saw a moderate annual increase of 1.8 percent, the NBG also noted. The NBG said the economic outlook was complicated by “high uncertainty.” Domestic factors, along with ongoing geopolitical tensions in the region, could elevate the country’s sovereign risk premium and subsequently lead to increased inflationary pressures.
Additionally, the bank said rising international food commodity prices and higher global shipping costs posed further risks to price stability. It noted that it was prepared to gradually reduce the policy rate toward its neutral level of 7 percent if inflationary risks do not materialize and conditions improve.
The next meeting of the committee is scheduled for January 29.

Georgian honey exports down 69.4 percent
Georgia exported 33.8 tons of honey ($271,150) in 2024, down 69.4 percent in volume (64.41 percent in value) compared to 2023, BM.GE reported.
The steepest drop was in exports to the EU: 1.12 tons (worth $6,510) sold to the EU market in 2024, compared to 72.64 tons in 2023 (worth $447,890)—a decrease of 98.5 percent. Last year traditional EU importers of Georgian honey, including Bulgaria, the Czech Republic, France, and Germany) were no longer listed as export markets.
Honey exports increased to the US, growing to 3.6 tons, a 95.5 percent increase. The top Georgian honey importer in 2024 was the United Arab Emirates, which purchased seven tons.
By value, the top import markets are: United Arab Emirates – $99,960; Azerbaijan – $63,200; US- $38,040; Iraq – $21,840, and Japan – $15,250.

Georgian external trade up 8 percent in 2024
Georgia’s external trade turnover reached $23.4 billion in 2024, reflecting an 8 percent YoY increase, Geostat said on January 20. Exports increased 7.8 percent to $6.6 billion, while imports rose by 8.1 percent to total $16.9 billion. Top trading partners of the county were Turkey with $3.2 billion, Russia with $2.5 billion, and the United States with $2.2 billion.
The trade deficit, a measure of the negative balance of trade in which a country’s imports exceed its exports, totaled $10.3 billion, and its share in trade turnover was 44 percent, Geostat reported.

Georgian wine exports up 24 percent YoY
The Georgian National Wine Agency on January 20 announced $565 million in exports for the country’s wine and spirits in 2024, marking a 24 percent increase from the previous year.
Throughout the year, Georgia exported 95 million liters of wine to 72 countries, generating $276.1 million – a 7 percent rise compared to 2023 figures. The following countries recorded the greatest increases in Georgian wine exports: United Arab Emirates – up 80 percent at 70,000 liters; Turkey – up 62 percent at 538,000 liters; the United Kingdom – up 42 percent at 425,600 liters; Azerbaijan – up 34 percent at 237,000 liters; the United States – up 32 percent at 1.2 million liters; Germany – up 30 percent at 1.9 million liters; and South Korea – up 26 percent at 72,500 liters.
Georgian wine was presented to markets in the United States, Portugal, Finland, Denmark, Austria, Norway, Italy, the Netherlands, Japan, Poland, Germany, China, France, the United Kingdom, Belgium, Hungary, South Korea, Switzerland, Turkey, and Latvia.
In addition to wine, exports of other alcoholic beverages were also up. With 48 million liters shipped to 56 countries, exports of other alcoholic beverages rose by 53 percent, contributing $289 million to the economy – a 47 percent increase in revenue, the National Wine Agency said.

Residential real estate prices increase 10.4 percent YoY in fourth quarter of 2024
In the fourth quarter of 2024, the Residential Property Price Index (RPPI) increased by 5.2 percent compared to the previous quarter, while the annual growth of the index was 10.4 percent, according to information released by Geostat in January. The index, which is limited to Tbilisi and includes only the new residential real estate market, has increased by 54.3 percent since 2020.
“In the fourth quarter of 2024, compared to the previous quarter, price increases were observed in both the residential apartment segment (4.7 percent) and the private house segment (6.7 percent). Compared to the fourth quarter of 2023, price increases were observed in both segments – by 9.8 percent for apartments and 12.3 percent for private houses,” the report states.

Khachapuri Index shows 6.1 percent increase in prices
The average cost to bake one Imeruli Khachapuri in January was 7.02 GEL, a 6.1 percent increase from January 2024, according to the ISET Khachapuri Index.
Costs ranged from 6.71 GEL in Batumi to 7.94 GEL in Telavi.
Prices for most ingredients increased in 2024: butter (+15.1 percent), cheese (+9.5 percent), yeast (+4.5 percent), and milk (+1.3 percent). Only eggs (-6.5 percent) and flour (-0.2 percent) were less expensive compared to 2023 prices.
ISET-PI notes the drop in flour prices (3.9 percent decrease between December and January), which reflects the decline in global prices since October. It adds that following the New Year season, the price of most Khachapuri ingredients lowered, except butter (+3.1 percent) and eggs (+4.3 percent).