Main Findings

- The ICT sector contributed about a third of the figure of the economic growth of the country. In recent years, the sector has become one of the main contributors of GDP growth.

- Against the backdrop of low sales in the local market and existing incentives, the impact of the ICT sector on the wellbeing of the population is fragmentary.

- From 2022 to the end of 2024, the number of companies registered in the ICT sector doubled. 99% of foreign enterprises registered in the sector are small-scale and are mostly comprised of individual entrepreneurs.

- In 2025, only 18 new companies were registered in the IT sector of the country, indicating that the growth of the sector in previous years was predicated on the effects of migration.

- 56% of active IT companies in the country are of Russian origin. The planned legislative amendment that will simplify the acquisition of Georgian resident status for IT sector representatives may become a means to make it easier for citizens of Russia to obtain resident status.

- While the IT sector in Georgia may be developing as a strong sector in terms of employment and circulation, its real fiscal impact and local commercialization are low - due to the business model of legislative incentives.

- Among some of the IT companies studied for the article, the number of employees in large IT companies decreased due to the relocation of Russian and Belorussian specialists from Georgia. Precisely this decrease has been cited as the grounds for the legislative amendments that will simplify obtaining resident status for IT sector representatives.

Conclusion

In recent years, the technological sector in Georgia—IT and software—has undergone clear dynamic growth. The entry of international companies into Georgia and the strengthening of local innovative businesses create highly competitive employment opportunities.

However, the figures reflecting the contribution of the sector to the growth of the GDP do not have the same impact on the wellbeing of the local population. Specifically, the dominance of foreign companies, the large share of employees of foreign citizenship, existing tax incentives, and low local sales have a significant influence on the revenues generated by the sector inside the country.

The impact of the IT sector on the economic growth of Georgia in recent years has largely been the result of the increased migration of IT specialists to Georgia following the start of the Russia-Ukraine war. Against the backdrop of decreasing migration, the desire to maintain the existing tempo of contributions of the sector to the economic growth of the country generates the temptation in the Georgian government to create additional tax (applying tax breaks even to employees residing outside the country) and residency (extending the term of the residency permit for IT sector employees) incentives. These new incentives, however, will lead to a further fragmentation of the real economic impact of the sector and more challenges in terms of state security arising from migration.