Another sign yet that Georgia’s worsening elations with the West is not deterring investment came in February, when the first phase of Eagle Hills Georgia’s Tbilisi Waterfront residential project sold out on its opening day.

The $6.5bn development, backed by United Arab Emirates (UAE) investors, is part of a wave of non-Western capital now reshaping Georgia’s economy, even as the country’s relations with the European Union and the United States continue to deteriorate.

“This development is a reflection of our long-term belief in Tbilisi as a unique destination,” Mohamed Alabbar, chairman and founder of Eagle Hills, said in a statement.

For a country with a $35bn economy, the scale is transformative. “For Georgia, $6.5bn is massive,” said Ivan Tchakarov of consultancy GlobalSource Partners in an interview with bne IntelliNews in autumn 2025. “It dwarfs annual FDI inflows from Europe.”

The project was announced after Prime Minister Irakli Kobakhidze visited Abu Dhabi in January 2025, signing a memorandum with Eagle Hills covering real estate in Tbilisi and Batumi, alongside infrastructure including a dry port designed to strengthen Georgia’s logistics role.

UAE President Sheikh Mohamed bin Zayed Al Nahyan later made a historic first visit to Tbilisi, hosted by Bidzina Ivanishvili, the billionaire founder and de facto leader of the ruling Georgian Dream party — a moment seized on by critics as symbolic of the country’s Eastward and Gulf-ward turn.

Growth holds despite Western pullback

Despite more than a year of protests, political turbulence and diplomatic isolation from Brussels and Washington, Georgia remains one of the region’s fastest-growing economies.

The International Monetary Fund projects growth of 5.3% this year, following 7.3% in 2025, when daily protests persisted in Tbilisi after the contested October 2024 general election and the Georgian Dream government’s decision to put the country’s EU accession process on hold. It expects growth to converge toward a potential rate of around 5% over the medium term.

While warning that strained EU relations could “weigh on investor sentiment and dampen foreign direct investment”, the IMF explicitly cited the UAE megaproject as an “upside risk to growth and job creation”.

“What has happened in Georgia in terms of the money coming in is a very interesting picture,” Tchakarov said, noting a sharp fall in EU and UK-sourced FDI in the first half of 2025. Those countries had historically been Georgia’s largest investors — and are now its loudest critics.

“Even with the geopolitical considerations that weigh negatively on Georgia, the macro picture is great,” he added. “Georgia still leads the South Caucasus in banking strength and institutional depth.”

Gulf and Asian capital steps in

A recent Eurasian Development Bank report highlights the rising role of Asian and Gulf investors across Central Asia, Eastern Europe and the South Caucasus.

“Arab investors have been increasingly exploring opportunities for asset diversification in Azerbaijan, Georgia and Armenia,” the report said, as they look beyond their traditional Central Asian targets.

Russia accounted for around 10% of Georgia’s external trade turnover in the first ten months of 2025, ranking among the country’s top three trading partners alongside Turkey and the United States.

Chinese investment remains small in absolute terms but is rising fast, focused on logistics, transport and energy, sectors aligned with Georgia’s ambition to position itself as a hub on the Middle Corridor linking Europe and Asia.

Tourism has emerged as another key stabiliser. Georgia recorded a 5.9% rise in international visitors in 2025, according to Geostat, led by arrivals from Russia, Turkey, Armenia, Israel, Azerbaijan and Iran.

Typically, only 7-8% of visitors come from the EU and UK, limiting the economic impact of political tensions with Brussels.

Politics fades — for now

Georgia’s EU accession process has been frozen since late 2024. The European Commission has since described the country as an EU candidate “in name only”, citing “serious democratic backsliding”.

The US has also kept its distance. Georgian hopes that Donald Trump’s return to the White House might soften Washington’s stance have not been realised. Instead, Georgia was snubbed during US Secretary of State Marco Rubio’s recent visit to the South Caucasus, where he visited Baku and Yerevan, but not Tbilisi. 

Yet so far, the political rupture has not translated into immediate economic pain. As Gulf capital flows in, trade tilts east and tourism booms, Georgia’s economy appears to be weathering its geopolitical pivot, even as its relationship with Europe continues to fray.