March 2014. Victor Kipiani, partner at Mgaloblishvili Kipiani Dzidziguri
1. STRATEGIC LOCATION OF GEORGIA AND BUSINESSES PROMISING FOR INVESTING:
Georgia’s unique location is bridging several meaningful economic regions with convenient access to Black Sea. As a result, the country is positions as the vital gateway for West markets to Caspian and Central Asian markets and vice versa.
Although, small by territory and relatively modest by scale of economy, Georgia still avails of variety of investment opportunities into range of business and economic sectors, among them, are:
a) energy - with the highest export potential;
b) tourism – with opening up of qualitatively new routes and destinations coupled with free tourist zones;
c) IT and communications – bearing in mind a relatively lower penetration of the market, and, consequently, with plenty of market share to be seized yet;
d) banking and finances – featured by steady growth over the number of years;
e) health and pharmacy – with fairly high speed of being under modernization;
f) real estate – distinguished as the rapidly developing industry with quest for multi-purposes infrastructure;
g) free industrial zones – first in its own in the region.
2. RANKINGS ON DOING AND DEVELOPING BUSINESSES IN GEORGIA:
Georgia has made and is making very good in terms of easiness of starting businesses and, most importantly, doing business in the country. Respective credentials are backed up by a range of reputable sources, such as Forbse, World Bank, Heritage Foundation and others. And, Georgia was recognized as World’s Number One Reformer in 2005 – 2010.
Among easiness of starting business is availability to set up a company in one day, application of “one-shop” principle, possibility of requesting registration documents either in Georgian or English.
3. ADVANTAGES OF HAVING TRADE OPERATIONS VIA GEORGIAN COMPANY
Advantages of engaging into trade by using a Georgian company are truly appealing to any foreign business trying to achieve a good exposure region-wide. Some of those outstanding premises when speaking about trade are:
a) free trade regime with the countries of Commonwealth of Independent States and Turkey;
b) low tariffs for import;
c) limited number of export and import licensing requirements and permits;
d) no quantitative restrictions when importing or exporting;
e) no customs tariffs on export and re-export;
f) no value added tax on export;
g) streamlined export and import procedures;
h) well developed facilities for smooth export and import operations.
Besides, Georgia enjoys GSP+ trade regime with EU and GSP with US, Canada, Japan and few other countries. It has also recently initialed Deep and Comprehensive Free Trade Agreement with EU alongside with EU Association Agreement.
4. GEORGIA BEING ON THE CUTTING EDGE OF BUSINESS DEVELOPMENTS IN THE REGION
Robust changes and reforms undertaken in course of the recent years clearly put Georgia among the world’s top preferable destinations for investing and businesses. Those changes are unparalleled when compared with the rest of Central and Eastern Europe and relate to reforms in taxation and customs by working out extremely liberal fiscal regulatory regime, liberalizing ant-trust and trade activities, substantially downsizing public sector and red tape, entrenching independence and impartiality of judiciary and eliminating corruption. As a result, keeping an open door policy for investors in any sector of its vibrant economy.
Last but not least is that Georgia and its people are very friendly to foreigners which further singles out the country and creates extra incentive for considering it positively in terms of placing your money and engaging into new businesses.