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Investment Climate of Georgia after "Rose Revolution": Recent Improvements and New Challenges

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  • Tea Kbiltsetskhlashvili

    () (International Black Sea University)

Abstract

The article focuses on effectiveness of Investment climate in Georgia after transition period. Investment climate is the institutional, policy and regulatory environment in which firms operate – factors that influence the link from sowing to reaping and I can say that investment climate itself is the process from sowing to reaping because you will reap what you sew. Investment climate is the opportunity and incentive for firms to invest productively, create jobs and expand.One of the major determinations of country’s economic developments and wellbeing are the indicators of investment structure and volume. These indicators show attractiveness of economy for foreign investors and give clues for analyzing countries development process. Investment climate matters for the total factor productivity, average wage rates, the rate of return on fixed assets, growth rate of output, employment, corruption plus government regulations, taxes, political and economical stability, migration. A good investment climate is an essential pillar of a country‘s strategy to stimulate economic growth, which in turn generates opportunities for poor people to have more productive jobs and higher income. Hypothesizing that long – term effect of foreign investment will increased in increased employment and household income, poverty will be decreased and Georgian economy will be developed. The paper also includes the results of a survey conducted to find out the changes of investment climate after "Rose Revolution".

Suggested Citation

  • Tea Kbiltsetskhlashvili, 2008. "Investment Climate of Georgia after "Rose Revolution": Recent Improvements and New Challenges," IBSU Scientific Journal, International Black Sea University, vol. 2(2), pages 47-86.
  • Handle: RePEc:ibl:journl:v:2:y:2008:i:2:p:47-86
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    File URL: https://journal.ibsu.edu.ge/index.php/ibsusj/article/download/86/48
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    References listed on IDEAS

    as
    1. Falcetti, Elisabetta & Lysenko, Tatiana & Sanfey, Peter, 2006. "Reforms and growth in transition: Re-examining the evidence," Journal of Comparative Economics, Elsevier, pages 421-445.
    2. Baldwin, Richard & Seghezza, Elena, 1996. "Trade-induced Investment-led Growth," CEPR Discussion Papers 1420, C.E.P.R. Discussion Papers.
    3. Sergio Godoy & Joseph Stiglitz, 2006. "Growth, Initial Conditions, Law and Speed of Privatization in Transition Countries: 11 Years Later," NBER Working Papers 11992, National Bureau of Economic Research, Inc.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    foreign direct investment; natural resources; employment; economic growth; political stability; taxes; corruption.;

    JEL classification:

    • M21 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics - - - Business Economics

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