Executive summary
Georgia’s latest economic data show that ICT and the digital economy are no longer only a technology-sector issues. They are becoming central to the country’s productivity, investment, human capital and long-term competitiveness. According to Geostat data for Q1 2026, the information and communication sector accounted for 11.7% of total business sector output, 4.4% of turnover and 6.3% of employment.
In Q1 2026, the sector’s turnover reached GEL 2.746 billion, while output reached GEL 2.717 billion. Both indicators increased by 3.7% year-on-year. Employment reached 50,628 people, up 7.3% compared with the same period of the previous year.
BTU researchers interpret these figures as a sign that Georgia’s digital economy is entering a new stage. The question is no longer just whether the ICT sector can grow. The deeper question is whether ICT can become a broad economic layer that strengthens production, trade, finance, education, public services, Georgian AI, data infrastructure and exportable digital services.
Main analysis
ICT is already a major creator of economic value
The information and communication sector accounts for 11.7% of Georgia’s business sector output. This makes its economic weight comparable to several large sectors, including construction, transport and trade. But ICT has one important distinction: it can create high value with fewer physical resources.
In traditional sectors, growth is often linked to land, buildings, materials, transport and heavy infrastructure. In the digital economy, value is created through knowledge, software, data, networks, intellectual services and skilled people.
This is why the importance of ICT should not be measured only by its sectoral share. Its multiplier effect matters even more: how it helps other sectors become more productive, reduce costs, improve services and respond faster to market changes.
Turnover and output are growing moderately, while employment is growing faster
In Q1 2026, turnover in the information and communication sector increased from GEL 2.648 billion to GEL 2.746 billion, or by 3.7% year-on-year. Output increased from GEL 2.620 billion to GEL 2.717 billion, also by 3.7%.
At the same time, employment increased from 47,199 to 50,628 people, or by 7.3%. This picture is important: employment grew faster than turnover and output.
On the one hand, this may indicate expansion – more companies, more teams, more projects and more technology roles. On the other hand, it raises a productivity question. If employment grows faster than value created, the sector needs to move toward higher-value services, more complex products and international scaling.
For Georgia’s ICT sector, the main challenge is not only to employ more people, but to create more value per person.
ICT is becoming strategically important for investment
Foreign direct investment data are especially important for the sector. In Q1 2026, information and communication attracted USD 37.2 million in FDI. This placed it third among sectors, after financial and insurance activities and real estate.
This is a strong signal. Investors do not look at ICT only as a current-income sector. They look at market potential, workforce capacity, regional positioning, digital-service exports and technology infrastructure.
For comparison, FDI in information and communication amounted to USD 115.2 million in 2025 and USD 65.1 million in 2024. This suggests that the sector is now firmly attracting investors’ attention.
ICT is not only programming – it is the digital layer of the economy
One of the main mistakes Georgia should avoid is seeing ICT only as programming, outsourcing or telecommunications. In a modern economy, ICT is the digital layer that enters every other sector.
Trade needs digital commerce, customer data and delivery systems. Production needs automation, digital quality control and demand forecasting. Construction needs digital project management, energy-efficiency analysis and data-based market assessment. Tourism needs online sales, personalized services and digital platforms. Education needs AI assistants, adaptive learning and technologies adapted to the Georgian language.
This means ICT development should be understood not as the growth of one sector, but as a precondition for upgrading the whole economy.
AI and data are the next stage
BTU researchers argue that the future of Georgia’s ICT sector will not be defined only by software services. The next stage will involve AI, data infrastructure, cybersecurity, Georgian-language technologies and business process automation.
For Georgia, Georgian data and the Georgian language are especially important. If AI systems do not understand Georgian language, Georgian business, Georgian consumers and Georgian social context well enough, the digital economy will remain heavily dependent on external platforms.
This is why ICT development should be connected not only to companies, but also to universities, research teams, data centers, public services, media, Georgian content and the country’s digital sovereignty.
The main risk: more jobs, but insufficient value creation
Employment growth of 7.3% is a positive signal. But it is not enough by itself. If the sector remains focused mainly on low-margin services, simple technical tasks or local support for foreign products, it will not create the level of value Georgia’s economy needs in the long run.
The sector needs to move toward higher-value areas: digital products, AI solutions, cybersecurity, data analytics, Georgian-language technologies, sector-specific software, digital exports and technology management.
This means ICT policy must be connected to education policy. Georgia needs programmers, data analysts, AI specialists, cybersecurity experts, product managers and technology entrepreneurs.
The digital economy can support regional development
ICT is also important because it is less dependent on physical concentration in the capital. If education, internet access, work culture and digital platforms develop properly, high-value jobs can also be created in regions.
This matters because a large share of business sector turnover and output is concentrated in Tbilisi. The digital economy can become one of the ways to create better jobs, higher incomes and more opportunities for young people outside the capital.
Key findings
- The information and communication sector accounted for 11.7% of total business sector output in Q1 2026.
- Sector turnover reached GEL 2.746 billion, while output reached GEL 2.717 billion.
- Turnover and output increased by 3.7% year-on-year, while employment grew by 7.3%.
- Employment in the sector reached 50,628 people.
- ICT attracted USD 37.2 million in FDI in Q1 2026, ranking third among sectors.
- The sector’s main challenge is to convert employment growth into higher productivity and exportable digital value.
- Georgia’s digital economy will depend on AI, data infrastructure, cybersecurity, Georgian-language technologies and the quality of technology education.
Data and evidence base
Georgia’s business sector turnover reached GEL 61.967 billion in Q1 2026, while business sector output reached GEL 23.294 billion. Turnover increased by 10.7% and output by 12.4% year-on-year.
Information and communication turnover increased from GEL 2.648 billion to GEL 2.746 billion, or by 3.7%. Sector output increased from GEL 2.620 billion to GEL 2.717 billion, also by 3.7%.
Employment in the sector increased from 47,199 to 50,628, or by 7.3%. Information and communication accounted for 6.3% of total business sector employment.
In the structure of business sector output, the information and communication sector accounted for 11.7%.
In Q1 2026, information and communication attracted USD 37.2 million in foreign direct investment, equal to 13.7% of total FDI and ranking third among sectors.
Why this matters for Georgia
ICT and the digital economy matter for Georgia because they can allow a small economy to access a much larger economic space. Georgia’s physical domestic market is limited, but digital services, software products, AI solutions, data analytics and technology expertise can be sold internationally.
ICT also matters because it increases productivity in other sectors. If trade uses customer data better, production improves planning, tourism sells services more effectively, education uses AI more intelligently and the state delivers better digital services, ICT becomes more than one sector. It becomes a system that changes the quality of the whole economy.
For Georgia, the Georgian language and Georgian data are especially important. The digital economy cannot become fully strong if Georgian remains underrepresented in AI systems, software platforms, databases and educational technologies.
This means ICT development is not only a business growth issue. It is a question of digital independence, education, economic competitiveness and the technological future of the Georgian language.
BTUAI assessment
BTUAI assesses the Q1 2026 data as strategically important, but still incomplete, for Georgia’s ICT and digital economy.
The sector already accounts for a significant share of business output and attracts one of the highest levels of foreign direct investment among sectors. This shows that ICT is already seen as a growth and future-oriented sector in Georgia’s economy.
At the same time, moderate growth in turnover and output, combined with faster employment growth, raises a productivity question. If the sector employs more people but does not increase value at the same pace, it must move toward higher-value activities: AI, data, cybersecurity, digital products, SaaS models, Georgian-language technologies and exportable digital services.
In BTUAI’s view, the main task for Georgia’s digital economy is not only to grow the IT sector, but to digitally upgrade the entire economy. ICT should become the layer that strengthens production, trade, education, tourism, energy, finance and public services.
If Georgia connects ICT with education, Georgian AI, data infrastructure, cybersecurity and business digital transformation, the digital economy can become one of the country’s strongest long-term competitive advantages.
Article identification
Article type: Sectoral analytical article
Topic: Georgian economy, ICT, digital economy, AI, data, investment, employment
Geographic focus: Georgia
Period: Q1 2026
Main sources: National Statistics Office of Georgia, business sector results, foreign direct investment statistics
Prepared by: BTUAI Research Team, Business and Technology University
Platform: BTUAI.ge
Publication year: 2026
Methodology
This analysis is based on publicly available official statistical data, including Geostat’s Q1 2026 business sector results and foreign direct investment statistics. The data were analyzed by sectoral share, turnover, output, employment, annual growth, investment and the strategic role of the digital economy.
The purpose of the article is not to assess individual ICT companies, but to identify broader trends in Georgia’s digital economy and highlight practical implications for business, education, technology policy and long-term national competitiveness.
Limitations
This article is based on publicly available data and analytical interpretation. It is not an official statistical report and does not constitute investment, financial, legal or professional advice. Some indicators may change after new or revised data are published. Specific business, technology or investment decisions should be made in consultation with relevant professionals.
Sources
National Statistics Office of Georgia – Business Sector Results, Q1 2026.
National Statistics Office of Georgia – Foreign Direct Investment in Georgia, Q1 2026.
FAQ
Why is ICT important for Georgia’s economy?
Because ICT creates high-value output, improves productivity in other sectors and allows Georgia to export digital services.
What does the Q1 2026 data show about the ICT sector?
Sector turnover and output increased by 3.7%, while employment increased by 7.3% year-on-year.
Is ICT already a large sector in Georgia’s economy?
Yes. Information and communication accounted for 11.7% of business sector output in Q1 2026.
Why is FDI important in ICT?
Because the sector attracted USD 37.2 million in FDI in Q1 2026 and ranked third among sectors, showing strong investor interest.
What is the sector’s main challenge?
The main challenge is to convert employment growth into higher productivity, more complex digital products, AI solutions and exportable services.
Keywords
ICT Georgia, digital economy Georgia, Georgian AI, data economy Georgia, information and communication sector Georgia, digital transformation Georgia, cybersecurity Georgia, technology education Georgia, BTUAI, Business and Technology University.
Citation format
BTUAI Research Team. “What Should Georgia’s ICT and Digital Economy Sector Consider Based on the Latest Economic Data?” Business and Technology University, BTUAI.ge, 2026.
Prepared by the academic team of Business and Technology University and the BTUAI Research Team.
Tbilisi, Georgia
BTUAI is an analytical platform of Business and Technology University that studies the impact of artificial intelligence, digital transformation, innovation, startup ecosystems, data analytics and emerging technologies on business, the economy, education and society. BTUAI materials are designed to explain complex technological and economic changes in a clear, reliable and Georgia-focused way.