In the interview with Obieqtivi TV’s Gamis Studia (Night Studio) program on October 26, 2019, Gigi Maglakelidze of the Alliance of Patriots party noted that against the background of U.S.-Georgia strategic partnership, the United States and American investors have not implemented even a single large commercial project in Georgia.
Gigi Maglakelidze: “Considering the importance of strategic partnership, the fact that we are strategic partners for such a long time, the United States has not implemented any large commercial project in Georgia, though they could have implemented one, two or three large commercial projects; I do not mean OPEC, I mean the projects implemented by the U.S. government, private investment funds and business people, because I have not seen large American businesses in Georgia.”
Giga Maglakelidze’s claims do not correspond to the reality, because the United States has been one of the main investors in Georgia since the nineties and it is still taking the lead by number of direct investments.
- Large American companies in Georgia:
1) Aecom
The largest U.S. consulting company AECOM has been operating in Georgia for already 13 years. In 2016, the company decided to further expand its activities and implement large investment projects, among them Sheraton Metechi Palace and Hyatt Regency projects.
BPN: “In 2016, AECOM was ranked 1st for the seventh year among Engineering News Record Top 500 Design Firms.
The company was number 156 on the 2016 Fortune 500 list. Large projects implemented by the company include the World Trade Center, as well as the complexes of Abu Dhabi, Hong Kong, Los Angeles and Sidney.”
2) Capitol HPS
Capitol HPS is the official representative in Georgia of the well-known American „BWH Hotel Group” global brand of hotels, currently uniting three famous hotel companies: WorldHotels Collection, Best Western Hotels & Resorts and SureStay Hotel Group. The purpose of the company is to develop tourism in Georgia. The company was founded in 2016 as part of the “Capitol Investment Group” alongside other ventures in various sectors (agriculture, industry, construction, development, investment project management, international brands representation, hotel management, etc.). According to the information posted on the company’s official website, by the end of 2019, the company will have seven hotels in five cities and their number will increase to 12 by the end of 2021.
3) Frontera Resources Corporation
Frontera Resources is an international oil and gas exploration and production company headquartered in Houston, USA. Its shares are traded on London Stock Exchange AIM market. Frontera’s current activities in Georgia are focused on the exploration and development of a large acreage in Kakheti region known as Block 12 where Frontera has the exclusive right to explore for, develop and produce petroleum pursuant to a 25-year Production Sharing Agreement entered into with the Georgian government. With over 190 employees based in the company’s Houston, Tbilisi and Kakheti field offices, Frontera is the largest US-based investor in Georgia’s upstream oil and gas industry.
According to the American Chamber of Commerce in Georgia, a lot of large or small U.S. companies are currently operating in Georgia. Moreover, there is a large number of Georgian companies that receive the U.S. assistance. The chamber has members of various categories. Category A includes the companies founded or incorporated in the US. Category B includes the companies with more than 33 percent U.S. ownership.
Category A companies:
Alliance LLC, Alliance Group Holding, American Medical Centers, Georgia, Anaklia Development Consortium, Avon Cosmetics Georgia LLC, Betsy’s Hotel and Prospero’s Books, Coca-Cola Company, Deloitte, Finca Georgia Microfinance Organization JSC, Gazelle Finance Georgia LLC, GULF Georgia by Sun Petroleum Georgia LLC, Hilton Batumi, Meridian Express Ltd, Radisson BLU Iveria Hotel, Willis Towers Watson Ltd. and others
Category B companies:
Adjara Group Hospitality, Bank of Georgia, Biltmore Hotel Tbilisi, BMC Gorgia Legal Bureau, Channel Energy (Poti) Limited Georgia LLC, by Petrocas Energy Group, Crystal MFO JSC, Georgian Express Ltd., HeidelbergCement Georgia, Liberty Bank, Wissol Georgia and others.
- General statistical data
According to the preliminary data released by the National Statistics Office, Geostat, in the second quarter of 2019, the United States comes third after Turkey and Netherlands by amount of foreign direct investments.
It is worth noting that the first American investments started to flow into Georgia in the nineties – in the period, when the local business climate remained poor, a result of onerous regulations and widespread corruption. Fady Asly, Chairman of ICC Georgia, noted in the article released by Forbes Georgia that the U.S and American investors invested huge money in Georgia from the very beginning.
Fady Asly: “American investors were among the very first international investors to commit to Georgia. For example, there was former U.S. Secretary of State James Baker, who invested in a winery and AES, the giant U.S. power company that privatized the power distribution in Tbilisi and invested about 300 million USD into the country.
According to the statistical data released by Geostat (1996-2019), the first U.S. investments appeared in 1997 and amounted to USD 96 651.9 thousand. According to the data for 1997, the United States was the largest investor, followed by Australia, United Kingdom and Austria. In coming years, other counties took the lead by number of investments.
- About OPIC
The Overseas Private Investment Corporation (OPIC) is a self-sustaining U.S. Government agency that helps American businesses invest in emerging markets. OPIC services are available to new and expanding businesses planning to invest in more than 160 countries worldwide. OPIC fosters economic development in emerging market countries. In this view, the United States manages to attract a lot of large or small investments to Georgia.
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