By Helena Bedwell

March 18 (Bloomberg) -- Foreign direct investment in Georgia fell 51 percent in 2009 from a year earlier to $759 million as the global economic slump curtailed appetite for emerging markets.

The decline “resulted from the global crisis, not from an outflow of investment from Georgia,” Irakli Matkava, director of the government agency Invest in Georgia, said by telephone in the capital Tbilisi today. “We forecast at least $1.3 billion in investment this year, though the number will still depend on the global situation.”

Georgia’s economy may expand 3 percent in 2010 after an estimated contraction of as much as 4 percent in 2009, President Mikheil Saakashvili said last month.

Saakashvili last year turned to the Middle East to revive foreign investment. In October, he said he had netted as much as $1 billion of investment from the United Arab Emirates within the next two to three years. A month later, a trip to Qatar yielded a pledge to “invest heavily” in Georgia.

Matkava said the Middle East offers “good possibilities” for finding investors. “Rakeen of the United Arab Emirates continues to invest in Georgia, and other countries may follow” after visits to the region by Saakashvili and Prime Minister
Nika Gilauri, he said.

Rakeen, a developer owned by the Gulf emirate of Ras al- Khaimah, paid $65 million for 49 percent of Georgia’s Black Sea Poti port in December 2008, after previously winning a government competition to develop the port and acquiring a 51 percent stake. It is also set to build an airport in Poti, which hosts the country’s only special economic zone to attract investors.

The company also has two development projects in Tbilisi, including a 72,836-square-meter residential and office complex on the outskirts of Tbilisi.

Qatari Diar Real Estate Investment Co., part of the country’s sovereign wealth fund, plans to complete plans for investments in Georgia following a fact-finding trip in April, Deputy Chief Executive Officer Hassan Alfadala said on Feb. 24.

Bloomberg