Despite officially reported positive economic indicators, the business environment in Georgia is rapidly deteriorating, says Larisa Pataraia, Managing Partner of consulting firm Start-Business Solutions. Speaking in an interview with BMGTV, Pataraia warned of a dramatic drop in investor interest and a demonstrated slowdown in economic activity, factors she says are not captured in headline statistics.
“I can say with confidence that we will not see an investor in the company in 2025,” Pataraia declared, noting that new projects currently make up less than 10% of the firm’s portfolio. “Today, I see no investors approaching us. We’ve pivoted almost entirely to anti-crisis services, helping clients boost sales, reduce costs, and optimize internal processes.”
Founded in 2013, Start-Business Solutions has supported companies across Georgia with market research and strategic consulting, often focusing on diversification and attracting investment. But Pataraia says the firm’s role has changed dramatically amid deteriorating business sentiment.
“We’ve been in the market for over 13 years. In the past, companies came to us to explore expansion and attract investors. Now, cost reduction has become a necessity, not just for SMEs, but for large organizations as well,” she said.
As Pataraia said, multiple sectors are facing severe pressure, with tourism, hospitality, and retail especially vulnerable.
“Sales are down in many industries. Official tourism statistics tell one story, but the reality on the ground is different—restaurants are closing, and many tourist facilities have remained shut for the season due to a lack of bookings,” she explained. “The clothing sector is also struggling. While large businesses are adapting, small and medium-sized enterprises are in crisis.”
To measure the current business environment, Start-Business Solutions is preparing to repeat a survey it conducted in December on market expectations. Pataraia noted key red flags such as an increase in loan restructuring and rehabilitation cases, clear indicators of distress in the SME sector.
Beyond economic challenges, Pataraia emphasized that political uncertainty is helping investor hesitation. She pointed to Georgia’s recent legislative shifts and its apparent move away from a Euro-Atlantic trajectory as significant deterrents to foreign investment.
“If Georgia does not return to the Euro-Atlantic path, we will not only fail to attract new investors, existing businesses will struggle to survive,” she warned.
