GEORGIA AT A GLANCE
Georgia, or how we call it “Sakartvelo”, is located at the eastern shores of the Black Sea and the southern flanks of the main crest of the Greater Caucasus Mountains. It is bordered by Russia from the north and northeast, Azerbaijan from the east and southeast, Armenia and Turkey from the south.
Georgia is a country of ancient civilization. Its territory was populated 1.7-1.8 million years ago. The archaeological excavations in the south eastern Georgia discovery the oldest inhabitant of Eurasia and referred to as the "First European". Georgia has very old and rich culture, country has its own, unique alphabet and language, spoken only in Georgia.
The first republic of Georgia (1918-1921) was very progressive and in many way ahead of its time. Georgia was one of the first states in the world which not only granted women the right to vote but the parlament included three women. Georgia was occupied by Soviet Russia in 1921, becoming part of the Soviet Union as the Georgian Soviet Socialist Republic. The current republic of Georgia has been independent since 1991.
Today, Georgia is a member of the United Nations, the Council of Europe, the World Trade Organization, the Organization of the Black Sea Economic Cooperation, the Organization for Security and Cooperation in Europe, the Community of Democratic Choice, the GUAM Organization for Democracy and Economic Development, and the Asian Development Bank.
In 2014 Georgia signed the Association Agreement with the EU, which further ensures predictability of political and investment climate of our country.
In early 2000's Georgia has undertaken a number of institutional reforms aimed at modernizing the economy and improving the business environment. By implementing extensive reforms to offer investors a liberal tax system and a more business friendly environment, Georgia has illustrated its commitment to opening its doors to the international investor community.
In the last years, further steps have been taken to ensure political stability, the rule of law, pro-business legislation and labor flexibility, all of which have contributed to an overall predictable investment environment and significant growth in local production and exports.
Today, stable economic development, liberal and free market oriented economic policy, only 6 flat taxes and reduced tax rates, significantly decreased number of licenses and permissions, significantly simplified administrative procedures, preferential trade regimes with foreign countries including EU, advantageous geographic location, well developed, integrated and multimodal transport infrastructure, educated, skilled and competitive workforce presents a solid ground for successful business in Georgia.
The country's ambitious objectives to be one of the best investment locations on the world map, are reflected in number of different well-recognized international rankings, where Georgia maintains strong positions. For example, Georgia holds 16th position in World Bank: 2016 Ease of Doing Business Index and one of the world’s leading corruption watchdogs, Transparency International, ranks Georgia as the most effective non-EU, post-Soviet member state in terms of fighting against corruption.
Georgia has diversified GDP structure which is well-positioned for sustainable growth and in 2015 GDP real growth rate amounted to 2.8%. GDP compound annual growth rate of last 5 years from 2010 to 2015 reached 4.9 % and Georgia is widely expected to maintain steady growth for the years to come.
The investment climate and opportunities of Georgia attract investors from around the globe. The FDI inflow in 2015 amounted to USD 1.6 billion and in I-III quarters of 2016 preliminary number of FDI reached USD 1.3 billion. Georgia has signed Bilateral Investment Treaties (BIT’s) with 32 countries and is member of ICSID Convention since 1992.
Georgia is a country with low tax rates and transparent tax system. All tax administration procedures and customs clearances are online/web-based. There are only 6 flat taxes in Georgia:
Companies pay Profit Tax only on distributed earnings, reinvested profit is exempt from corporate profit tax.
Personal income tax for interest, dividend and royalty is 5%. Georgia doesn’t have social security, capital gains, wealth or inheritance tax. World Economic Forum’s Global Competitiveness Report named Georgia #9 among low tax rate economies.
Georgia’s Free Trade Regimes provide investors opportunity to access 900 million population markets without customs tariffs. To date, Georgia has Free Trade Agreements with EFTA and CIS countries along with Ukraine and Turkey, and Deep and Comprehensive Free Trade Area (DCFTA) with EU. Starting from the middle of 2017, FTA with China will enter into force, granting Georgian products access to additional 1.3 billion market without customs tariffs.