The Risk of Intellectual Capital Drain in Georgia: Shorena Kopaleishvili Discusses IT Sector Challenges on “Business Morning”
The future of Georgia’s IT sector is under threat as concerns grow over the potential emigration of highly skilled professionals due to the country’s ongoing political and economic instability. Shorena Kopaleishvili, Chairwoman of the Association of Georgian Virtual Zone Persons, recently appeared on “Business Morning”, a prominent business media program, to discuss these pressing issues and their potential impact on the industry.
During the interview, Kopaleishvili emphasized the critical risks posed by the current crisis, which has created an unpredictable environment for IT companies and professionals. She pointed out that the deviation from a European-oriented course has alarmed international investors and businesses, jeopardizing Georgia’s reputation as a stable and attractive destination for IT operations.
“Georgia’s IT sector, specifically the VZP sector, is one of the pillars of our economy, contributing over 85 million GEL of taxes to the state budget in ten months of 2024. However, this success is now at risk as uncertainty grows within the industry,” Kopaleishvili warned.
She highlighted how international IT companies operating in Georgia, particularly those benefiting from the virtual zone status and tax incentives, have expressed concerns over the deteriorating business climate. These companies, heavily reliant on global markets and international clients, are particularly sensitive to the country’s political and economic shifts.
Kopaleishvili also drew attention to the decline in inquiries from foreign businesses about Georgia’s tax advantages and opportunities in the virtual zone. “This trend reflects a broader issue – Georgia is losing its appeal to international investors. The uncertainty is making it difficult for companies to plan, forecast taxes, and make long-term commitments,” she explained.
The conversation on “Business Morning” also touched on the impact of instability on the industry’s workforce. Kopaleishvili noted that many IT professionals are considering relocation to countries offering better opportunities and a more predictable environment. This potential talent drain could have a long-lasting negative impact on Georgia’s ability to remain competitive in the global tech market.
She concluded by calling all the parties for urgent measures to restore confidence in the sector. “We need a stable and predictable environment that supports innovation and business growth. Adhering to European values and maintaining a European-oriented course are crucial for retaining talent and attracting investment,” Kopaleishvili said.
She underscored the urgent need to address the challenges faced by the IT sector and to take concrete steps to ensure that Georgia remains a hub for innovation, talent, and international business.
