The role of foreign direct investment in the national economy and correlation analysis
Published Online: Nov 2, 2022
Published: Jan 31, 2023
Email:
ramin.tsinaridze@bsu.edu.ge
Batumi Shota Rustaveli State University, Batumi, Georgia
Email:
nini.makharadze.98@gmail.com
Batumi Shota Rustaveli State University, Batumi, Georgia
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Abstract:
Objectives: World trends point to the importance of FDI. It directly or indirectly affects the economy and all other industries. Foreign investment has a significant impact on the development of both economic and intangible values. The main goal the task of scientific work is to study the impact of foreign direct investment.
Methods/Approach: FDI statistics in the world and in Georgia, studies and correlations will allow us to analyze the pace of development of Georgia's investment environment, its advantages and disadvantages.
Results: A correlation has been established between foreign direct investment and employment, gross domestic product and export-import. The correlation between foreign direct investment and employment is strong, which is logical due to the strong impact on employment. The weakest connection is with imports and exports. In this regard, it is interesting to note that an increase in foreign direct investment also leads to an increase in the level of employment. We have studied the compatibility of Georgian business and foreign investment.
Conclusions: International experience and trends in Georgia show that FDI is one of the main drivers of solving socio-economic problems. The investment environment is connected with all important sectors and directions of the country.
Despite the global pandemic and the difficult economic situation of Georgia, as a result of the implementation of important regulations, it will be possible to improve the economy through foreign direct investment.
Keywords:
JEL Classification:
E22; F36; F66; G11
How to cite:
Tsinaridze, R., Makharadze, N. (2023). The role of foreign direct investment in the national economy and correlation analysis. Access to science, business, innovation in digital economy, ACCESS Press, 4(1): 46-59. https://doi.org/10.46656/access.2023.4.1(4)
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