Zurab Pololikashvili,
Secretary General, UN Tourism

Tourism Doing Business – Investing in Georgia is a comprehensive resource for tourism professionals and investors seeking in-depth knowledge about Georgia's tourism sector and the investment opportunities it presents.

The guide helps investors to make informed decisions by showcasing Georgia's natural and cultural heritage as long and the efforts to foster the economy. The government's focus on responsible tourism and economic stability positions Georgia as a promising market that exceeds conventional expectations, providing a blend of cultural richness and economic opportunity.

Since 1991, the country has undertaken extensive economic reforms to liberalize the market, eradicate corruption, and attract foreign investment. These reforms have created a business-friendly environment, earning Georgia 7th position in the World Bank´s ease of doing business index.

Economic Outlook

These guidelines begin with an overview of Georgia's macroeconomic landscape, highlighting its impressive GDP growth of 5% over the last decade. Georgia has shown remarkable resilience, with GDP rising from USD 17.6 billion in 2014 to USD 30.6 billion in 2023. Looking ahead, the growth rate is expected to average 5.1% annually over the next three years, positioning Georgia as an attractive destination for investment, despite contending with global inflationary pressures and heightened geopolitical uncertainties.

Investment Outlook

Georgia's investment climate is thriving, with Foreign Direct Investment (FDI) inflows reaching an unprecedented USD 2.3 billion in 2022, the highest on record. This trend continued into 2023, with FDI totaling USD 1.9 billion. Preliminary data for the first half of 2024 shows FDI inflows 1.1% above the last five years' average and 34% above 2019. The main sources of FDI include the United Kingdom, the Netherlands, Azerbaijan, and Türkiye.

In the tourism sector, Georgia has seen significant data on FDI, with three greenfield projects totaling USD 352.9 million, meaning an average investment of USD 117.6 million per project, positioning the country as the 4th highest average CAPEX per project among Central and Eastern Europe.

Value Proposition

This publication outlines Georgia's compelling value proposition for tourism investments. Georgia has a rich cultural heritage with numerous archaeological sites, and a rapidly growing tourism sector that is becoming key for its economy, contributing significantly to job creation and economic growth.

While there are numerous reasons to invest in Georgia, there are five highly relevant aspects that deserve to be highlighted:

1. Diverse Natural and Cultural Attractions & Resorts: Georgia offers a rich tapestry of natural beauty and cultural heritage, featuring over 12,000 historical monuments and four UNESCO World Heritage Sites. Additionally, Georgia's has significant role as a historical Silk Road corridor and an emerging medical and wellness tourism landscape.
2. Well-Connected and Easily Accessible Location: Strategically positioned between Europe and Asia, Georgia boasts modern transport infrastructure. Additionally, Georgia's liberal visa policy allows visa-free travel for citizens of 98 countries, making it an accessible destination for tourists and businesses.
3. Potential for Hospitality and Real Estate: In 2023, Georgia welcomed 6.2 million international visitors, generating USD 4.1 billion in revenue. The expansion of international brand hotels and robust real estate market, attracting over USD 500 million in FDI in recent years, highlight its potential.
4. One of the Lowest Taxes Globally: Georgia's tax system is among the most favourable worldwide, featuring a low total tax rate of 9.9%, no capital gains, wealth, or inheritance taxes, and numerous incentives for businesses. Companies benefit from a 0% tax on reinvested profits and a competitive 15% tax on distributed earnings. The flat personal income tax rate of 20% further simplifies compliance.
5. Stable and Favourable Business Environment: Georgia is renowned for its transparency and regulatory efficiency. Economic reforms, such as the Association Agreement and DCFTA with the EU, and recent EU candidate status, highlight its commitment to integration and development. Investment promotion agencies like Enterprise Georgia and robust free trade agreements with major markets enhance Georgia's appeal.

Competitive Outlook

Finally, the report analyzes Georgia's competitive place in the wider tourism landscape, highlighting significant growth. Georgia ranks 3rd least tax-burden country globally, according to World Bank Group, 7th out of 190 countries, globally, in the World Bank's Doing Business Ranking 2022.

In the tourism sector, the country has shown dynamic performance and resilience in attracting international tourism since 2018, however, the COVID-19 pandemic led to a significant decline, the sector has been on a steady path to recovery, with 1.6 million tourists in 2021, 3.7 million in 2022, and reaching 4.7 million in 2023.

According to Georgia's Tourism Administration, in the first half of 2024 alone, the country received 2.7 million tourists. International tourism receipts have already exceeded pre-pandemic levels, recovering faster than international tourist arrivals.

In the first half of 2024, international tourism receipts reached USD 1.9 billion, a 30% increase versus 2019. The trend not only signals a robust recovery post-pandemic but also shows that tourists are spending more per visit, which is advantageous for Georgia's economy.