Page 25 - bne IntelliNews George country report Sept 2017

FDI inches up 3.7% y/y in Q1 preliminary figure shows
China-led AIIB to finance $114mn road project in Georgia
the Netherlands ($97.2mn) and Luxembourg ($88.3mn).
Annual FDI in Georgia peaked at $2bn in 2007, prior to the country's five-day war with Russia, and, although it came close to the same level in 2014, it has yet to fully recover.
In the first quarter, FDI inched upwards by 3.7% y/y to $403.3mn, according to preliminary figures by statistics agency Geostat on June 9.
Azerbaijan and Turkey ranked as the largest FDI sources in Q1, with $97mn and $82mn invested respectively, followed by the UK ($80mn), the UAE ($39mn) and Cyprus ($22mn). Russian companies registered in Cyprus are normally the primary source of investment from Cyprus in the Caucasus.
The Asian Infrastructure Investment Bank (AIIB) has signed an agreement to finance a bypass road around the Georgian beach resort of Batumi to the tune of $114mn, agenda.ge reported on June 17.
This is the China-led multilateral lender's first project in Georgia and the South Caucasus.
Founded two years ago with $100bn in capital aimed at financing the new Silk Road, AIIB has focused its financing efforts on Central and South Asia until now. Its investment in Georgia speaks to the importance of the small, but strategically located South Caucasus country, with which China also agreed to the first free trade agreement (FTA) in the region earlier this year.
Authorities in Batumi are seeking to build a bypass road in order to avoid national roads crossing tourist and residential areas in Batumi. The project is expected to be launched this year and be completed in 2022.
AIIB also signed an agreement with the Asian Development Bank (ADB) on June 16 to cooperate on the project. ADB has more experience financing projects in Georgia, having invested some €108mn in infrastructure projects in the country to date.
25 GEORGIA Country Report September 2017 www.intellinews.com