Georgia discusses the situation with a sharp reduction in foreign investment

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Read: 549     14:00     26 Ноябрь 2021    

The impact of the pandemic on the Georgian economy and ways to overcome the crisis were discussed at a regular meeting of the Investors' Council chaired by Prime Minister Irakli Garibashvili. This is reported by the press service of the administration of the Government of Georgia.
The volume of foreign direct investment in Georgia in 2020 decreased by 52.9% compared to the previous year, amounting to $ 616.9 million. In the second quarter of 2021, it decreased by 2.6% compared to the same period in 2020, to $234.2 million.
The Council discussed attracting foreign direct investment in renewable energy sources and the agricultural sector, the possibility of expanding access to finance, problems in the construction sector, reform of state-owned enterprises, as well as issues related to the pharmaceutical industry.
"We discussed the impact of COVID-19 on the flow of foreign direct investment into the country, as well as local and foreign investments in the renewable energy sector, which is a very promising area for development. We also discussed the issue of secured securities - bonds. This is a new law that will be adopted very soon and will facilitate the import of financial assets to Georgia," said Katarina Bjorlin Hansen, Regional Director of the European Bank for Reconstruction and Development (EBRD) in the Caucasus.
Zviad Chumburidze, Secretary General of the EU-Georgia Business Council, said that along with attracting investments, the council focused on the issue of privatization of state-owned enterprises.
"Unfortunately, state-owned enterprises are unprofitable and, according to the Ministry of Finance, their loss is about a billion lari per year. That is, these are enterprises that are unprofitable with poor management, and they could be profitable with good management," Chumburidze said in an interview bm.ge.
He recalled that a special group has been assembled for the reform of state-owned enterprises in Georgia. Chumburidze believes that the Investors' Council should also get involved in the process.
"We are not talking about state strategic organizations, such as the railway, we are talking about non-strategic companies that should be prepared in such a way as to become attractive to investors," Chumburidze said.
The Government of Georgia and the EBRD signed a memorandum on the establishment of an investor council in May 2015. According to the document, the parties are working together to attract investments to Georgia and improve the business environment. The Council is headed by the Prime Minister of Georgia. The council consists of Georgian and foreign business associations, business ombudsmen, international donor organizations active in the field of private sector development.
The EBRD is the largest investor for Georgia. It plays an important role for the recovery of the country's economy. To date, Georgia has invested 4 billion euros in more than 250 projects, including 87% in the private sector. In 2020, the Bank invested a total of 630 million euros in 16 projects in Georgia, which is twice the amount invested in the previous year. The Bank has provided extraordinary liquidity and working capital to support viable private sector companies.

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Georgia discusses the situation with a sharp reduction in foreign investment

2021/11/6561-1637919250.jpg
Read: 550     14:00     26 Ноябрь 2021    

The impact of the pandemic on the Georgian economy and ways to overcome the crisis were discussed at a regular meeting of the Investors' Council chaired by Prime Minister Irakli Garibashvili. This is reported by the press service of the administration of the Government of Georgia.
The volume of foreign direct investment in Georgia in 2020 decreased by 52.9% compared to the previous year, amounting to $ 616.9 million. In the second quarter of 2021, it decreased by 2.6% compared to the same period in 2020, to $234.2 million.
The Council discussed attracting foreign direct investment in renewable energy sources and the agricultural sector, the possibility of expanding access to finance, problems in the construction sector, reform of state-owned enterprises, as well as issues related to the pharmaceutical industry.
"We discussed the impact of COVID-19 on the flow of foreign direct investment into the country, as well as local and foreign investments in the renewable energy sector, which is a very promising area for development. We also discussed the issue of secured securities - bonds. This is a new law that will be adopted very soon and will facilitate the import of financial assets to Georgia," said Katarina Bjorlin Hansen, Regional Director of the European Bank for Reconstruction and Development (EBRD) in the Caucasus.
Zviad Chumburidze, Secretary General of the EU-Georgia Business Council, said that along with attracting investments, the council focused on the issue of privatization of state-owned enterprises.
"Unfortunately, state-owned enterprises are unprofitable and, according to the Ministry of Finance, their loss is about a billion lari per year. That is, these are enterprises that are unprofitable with poor management, and they could be profitable with good management," Chumburidze said in an interview bm.ge.
He recalled that a special group has been assembled for the reform of state-owned enterprises in Georgia. Chumburidze believes that the Investors' Council should also get involved in the process.
"We are not talking about state strategic organizations, such as the railway, we are talking about non-strategic companies that should be prepared in such a way as to become attractive to investors," Chumburidze said.
The Government of Georgia and the EBRD signed a memorandum on the establishment of an investor council in May 2015. According to the document, the parties are working together to attract investments to Georgia and improve the business environment. The Council is headed by the Prime Minister of Georgia. The council consists of Georgian and foreign business associations, business ombudsmen, international donor organizations active in the field of private sector development.
The EBRD is the largest investor for Georgia. It plays an important role for the recovery of the country's economy. To date, Georgia has invested 4 billion euros in more than 250 projects, including 87% in the private sector. In 2020, the Bank invested a total of 630 million euros in 16 projects in Georgia, which is twice the amount invested in the previous year. The Bank has provided extraordinary liquidity and working capital to support viable private sector companies.

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