COVID-19 effect on FDI motivation and their impact on service sector: Case of Georgia

Based on the Scott-Kennel’s model of local industry upgrade through foreign direct investments, this paper analyses if investments are always positively benefiting the host economy, or if they are not promoting local/host economies at all, or to which exact level. This paper is focused on service sector oriented investments and answers the questions important to analyse for the successful investment policy creation, which could benefit both the local economy and foreign investors. In other words, only aggregated per year foreign investment numbers are not enough for the comprehensive picture creation and in some cases could even suggest incorrect strategic decisions. Research was done based on deep interviews with the top management of 20 different companies listed in top 200 FDI making companies in Georgia for the 2020 year. Paper considers the global pandemic reality and future perspectives.