ISET Economist Blog

A blog about economics in the South Caucasus.
Nikoloz Pkhakadze has not set their biography yet

Location Games

One or two years ago, a Lavazza’s take-away coffee shop opened on the side of Georgia’s east-west highway in the area of Zestaponi. You always could find plenty of coffee shops in Tbilisi, but it was a novelty to have them next to the highway. Soon afterwards, another coffee bar opened along the road, and surprisingly, it was again set up close to Zestaponi. And today, there are even more take-away coffee points along that road, and they all cluster at Zestaponi. Travelling from Tbilisi to Kutaisi or Batumi, you will notice other such clusters. You can b...
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Fresh Capital for the Georgian Economy

Last year, Prime Minister Bidzina Ivanishvili announced his plans to set up a so-called co-investment fund. It took a year for this idea to mature, but finally a group of financially potent investors endowed the fund with 6 billion dollar. 15 % of the capital is provided by Bidzina Ivanishvili himself, the remaining 85% are held by the Abu Dhabi Group, the Ras Al Khaimah Investment Authority (both United Arab Emirates), Milestone International Holding from China, Mr. Alexander Moshkevich from Kazakhstan, capital of the late Badri Patarkatsishvili, Batumi...
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The Two Faces of Foreign Direct Investment

Recently, the Georgian media abounded with alarming reports about a slowdown of foreign direct investments (FDI) in Georgia. Indeed, economic figures seem to support the view that there may be a turn in the FDI activity. The graph shows FDI in the first two quarters of each year from 2005 to 2013. There is obviously a huge volatility in the investment activity throughout those years, reflecting economic and political events like the war and the financial crisis in 2008. Yet since 2009, FDI activity was following a slow but steady upward trend. This trend...
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