United NationsDepartment of Economic and Social Affairs Sustainable Development

Georgia’s Innovation and Technology Agency (GITA )– as an enabler of vibrant sustainable entrepreneurial ecosystem in the country

    Description
    Intro

    GITA gave a strong push to the development of Georgia’s innovation ecosystem. It set the stage for the establishment of innovation support institutions all over the country, as part of GITA’s functional responsibility: science and technological parks, business incubators, accelerators, technology transfer centre, laboratories of industrial innovations (FabLabs), innovation laboratories (ILabs) and innovation centres. GITA initiated and executed the first open competitive calls for grant financing of innovative start-ups and innovation projects. Practical implementation was greatly supported by the GENIE project, implemented by GITA with technical assistance and funding provided by the WB.

    Description

    In compliance with GITA’s Action Plan, society in urban and rural areas started experimentation with new ideas across the economy and culture. This raised the imperative for innovation policy and institutions to play a leading role not only in funding research and housing high-technology start-ups, but in enabling and promoting innovation across the economy - and in governance itself. With promoting experimentation, ensuring knowledge diffusion across sectors, using technology well, and making the most of the potential inherent in efficiency seeking FDI and far-reaching export opportunities, while investing into hard and soft infrastructure, GITA has made Georgian society to become ready to identify and cultivate the elements that enabled the foundation of its long-term sustainable development.

    Contribution to SDG Implementation

    GITA’s AP was designed towards Industry 4; to address challenges related to increasing competitiveness of human capital, to include start-ups in circular economy, to decrease gap between the industry and science, to encourage applied research commercialization and environmental sustainability. Inclusive accessible technological Parks are operating on one-stop-shop-principle, promoting innovation and entrepreneurship, through providing access to co-working space, technology equipment for prototyping, access to business incubation and acceleration programs, knowledge and education generation.

    Implementation methodologies

    Georgia’s Innovation and Technology Agency GITA has the clear mandate towards the fourth industrial revolution: to stimulate innovation, modern technologies and R&D, facilitate commercialization and usage of R&D; support to innovative start-ups and their competitiveness growth, facilitate cooperation between the representatives of scientists and businesses. GITA was established under the supervision of the Ministry of Economy and Sustainable Development as a main coordinator and mediator of the innovation processes in the country and the support from the World Bank Group, was secured for the Project - Georgia National Innovation Ecosystem (GENIE) in the amount of US$23.5 million. The main activities of the project are dedicated to increase innovative engagements of the micro, small, and medium-sized enterprises (MSMEs) in all sectors, including startups, and individuals in Georgia and their participation in the digital economy. Technological parks and maker spaces throughout the country are the facilities for startups to access the physical infrastructure, access the high-tech equipment (FabLabs: 3D printers, laser cutters, PCB, etc.) to prototype their hardware startup ideas, as well as access the co-working spaces and training, conference facilities. The infrastructure promotes the connections and builds the community. As a result, Georgia is having up to 200 globally scalable startups, with FinTech, AI, VR, Lifescience, Edtech, Agrithech, Femtech solutions, who have raised millions of dollars from the private local and international investors.

    Results

    Outputs: Startup-friendly environment-law on innovation, IP is in place, promotion of crowdfunding activities, and enhancement of innovation procurement system; Favorable regulatory framework-Free Virtual Zone allowing the technology startups exporting the product from Georgia, to be released from the taxes (0% corporate tax, 0%VAT, no annual license fees).The income tax is decreased to 5% for IT companies. Community building to innovate-the skills and capacity development is the integral part; Innovation infrastructure-technological parks throughout the country including border regions. Access to finance – GITA’s funding starts from the idea generation and prototyping, through small grants program (2 000 - 6 000USD). For the development, on pre-seed and seed-stage there are next round grants program (35 000 – 250 000 USD), aiming to finance globally scalable innovative ideas, with mentorship and coaching, to fund the startup and at the same time incentivize private sector investment.

    Factors and Constraints

    Conditions that helped the practice to succeed: GITA’s Capacity building activities with EU relevant authorities, and US; World Bank Support scheme – Project Georgia National Innovation Ecosystem (GENIE); Conducted studies for identifying the needs and external evaluations; Skills development practices; Gender sensitive and environmentally friendly screening of the beneficiaries and applicants. Constrain is private sector’s passive involvement in the financing of risky businesses.

    Sustainability and replicability

    In 2014, when GITA started operating, in the stereotyping environment, nobody knew even a definition of startup or an “enabling ecosystem”. Currently most of the activities are outscored and conducted by private sector representatives and service providers; grants are implemented together with NGOs; TechParks are supposed to become into the self-sustained entities since 2023. Women involvement in STEM education is increased; awareness campaigns about circular economy are conducted.

    COVID-19 Impact

    The COVID-19 has accelerated the implementation process and has shown the additional needs and acceptance to the whole society. Before, it was a challenge to reach the stakeholders influenced by stereotypes about traditional entrepreneurship skills. They were infrequently encouraged technologically and scientifically; now entrepreneurs accept and seek more innovation and in response to this, GITA on the one hand added the new programs and on the other hand adjusted planned activities in compliance with the pandemic rules (International Accelerator, Matching Grants, digital skills development and etc.);

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    Organization/entity
    Administration of the Government of Georgia
    SDGs
    3 4 7 9 10
    Geographical coverage
    Timeline
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    Countries
    Georgia
    Georgia
    Partnership
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