Digital transformation is changing how businesses around the world operate, compete, and create value for their customers. For small and medium-sized enterprises (SMEs), embracing digital tools has become crucial not just for boosting productivity and efficiency, but also for building resilience and ensuring long-term success.

This is a working note outlining the initial processes behind the SME Test Methodology. It is a notable deliverable part of the Developing an RIA SME Test Methodology for Georgia, while strengthening the capacity of the Government of Georgia to utilize SME RIA tools in practice Project, as funded by the UNDP and led by ISET Policy Institute.

In recent years digitalization has continued to reshape global contexts, impacting all aspects of life and business. The pandemic accelerated digital adoption, making it a critical factor for business resilience.

The profit tax system that came into force on January 1, 2017, in Georgia aims to create a favorable business environment, accelerate economic growth, and improve tax administration. This system is based on the distributed profit taxation regime, similar to the one implemented in Estonia.

This annual report provides an analysis of economic trends, as well as denoting the challenges and opportunities (in local, regional, and global contexts) across selected value chains within six sectors to improve evidence-based decision-making through the provision of quality information and analytics.