Countries with small economy are characterized by capital deficit. For this reason attracting investments for the economy of Georgia has an important priority. The article deals with the regional investment policy, importance and peculiarities of investment climate in the Autonomous Region of Adjara are presented. Practical action of investment policy instruments is worked out. For the development and modernization of the Autonomous Region of Adjara maximum use of the possibilities of regional investment policy and creation of necessary environment for attracting investments are of vital importance. On the basis of the results analysis of given theories in literature some possible ways of improvement of investment policy are shown. Recommendations were made on the basis of relevant conclusions. This study investigated the impact of foreign direct investment (FDI) on construction sector with a view to identifying the challenges to the flow of foreign direct investment and a resultant effect of increase flow of FDI and FDI construction projects in the Autonomous Republic of Adjara. In the modern world, which is gradually experiencing globalization results, the role and importance of foreign direct investments are important. In modern times foreign direct investments are one of the driving forces of economic globalization. They are an integral part of the international economic system and a major catalyst for economic development. This is a flow of capital, technology, human resources from one country to another. In many countries, national policy and international industrial achievements play an important role in attracting foreign direct investments. Investments, as an economic category predict the growth of the country's economy, increase production potential and perform a number of important functions, without which the economy cannot develop. In foreign literature, foreign direct investments are considered as the fundamental part of the open and successful international economic system and the main mechanisms for its development. The aim of this dissertation is to provide a theoretical overview of important factors of FDI, the effects of FDI in the construction business and development of practical recommendations in the field of investment environment as a result of the effects of FDI on the host country. The theoretical models, used in the dissertation, separate emphasized, that foreign direct investment has a positive impact on construction business growth of recipient countries (for example, enhancement of productivity, technology transfer, new processes, management practices, access of know-how, the training and so on). The research found that these factors affect the economy of the Autonomous Republic of Adjara as a whole and support the growth of construction business in the region.