by The FINANCIAL — According to the Georgian National Tourism Administration (GNTA), Georgia welcomed 9.4 million international visitors in 2019, a record high that marked an 8% increase over 2018. The sector contributed $3.2 billion to the economy, accounting for 8.4% of GDP that year. Following the COVID-19 pandemic, recovery has been swift: in 2022, international traveler visits reached 5.4 million, a 72% recovery compared to 2019 levels, surpassing the global average of 63% and Central/Eastern Europe’s 59%, per UN Tourism data. By the first half of 2023, Georgia recorded 2.5 million international visits, reflecting a 78.3% recovery in tourism revenues compared to the same period in 2019.
In comparison, neighboring countries show varying trajectories. Turkey, a regional tourism powerhouse, welcomed 51.4 million international visitors in 2019, generating $34.5 billion, per the Turkish Statistical Institute. By 2022, it had recovered to 44.6 million visitors, an 87% recovery rate, driven by its well-established infrastructure and coastal resorts. Armenia, with a smaller market, recorded 1.9 million visitors in 2019, dropping to 375,000 in 2020, and rebounding to 1.3 million in 2022 (68% recovery), according to the Statistical Committee of Armenia. Azerbaijan saw 2.9 million visitors in 2019, with tourism revenues of $2.7 billion, recovering to 1.6 million in 2022 (55% recovery), per the State Statistical Committee of Azerbaijan. Georgia’s recovery outpaces Armenia and Azerbaijan but lags behind Turkey, reflecting its mid-tier position in the region.
Emerging Tourism Destinations in Georgia
Georgia’s tourism growth is not limited to its capital, Tbilisi, or its Black Sea coast. Several regions are emerging as promising destinations, supported by government initiatives and natural allure. The GNTA and the Georgia Department of Economic Development (GDEcD) highlight the following:
Svaneti: This mountainous region, a UNESCO World Heritage Site, is gaining traction for its medieval towers, rugged landscapes, and adventure tourism potential. Visitor numbers to Mestia, its main hub, increased by 15% from 2021 to 2022.
Racha: Known for its pristine forests and emerging wine tourism, Racha is seeing infrastructure investments, including new guesthouses and trails, with a 10% uptick in visits in 2023.
Kakheti: The heart of Georgia’s wine country, Kakheti reported a 12% increase in international visitors in 2022, fueled by wine festivals and cultural tours.
Adjara (beyond Batumi): While Batumi remains a seaside staple, rural Adjara’s Green Zones and mountain villages are being promoted as eco-tourism hotspots, with a 5% rise in overnight stays in 2023.
These regions benefit from government efforts to improve infrastructure, such as highways and ski resorts, and offer tax incentives to investors, as noted by the U.S. Department of State’s 2024 report on Georgia.
Why Are U.S. and European Travelers a Minority?
Despite Georgia’s appeal, U.S. and European travelers remain a minority of its tourist influx. In 2022, Russia (1.2 million visits), Turkey (1.1 million), and Armenia (900,000) dominated, accounting for over 60% of international arrivals, per GNTA data. By contrast, the European Union contributed 600,000 visits (11%), and the U.S. just 50,000 (less than 1%).
Several factors explain this disparity. Proximity drives visitation from neighboring countries, with Russia, Turkey, and Armenia sharing borders and cultural ties with Georgia, facilitating short, cost-effective trips. GNTA statistics show that 70% of Russian and Turkish visitors in 2022 traveled for leisure or family visits, often by land. Conversely, U.S. and European travelers face longer travel distances and higher costs, with direct flights from the U.S. limited to seasonal routes and EU connections primarily through hubs like Istanbul or Warsaw.
Awareness also plays a role. While Western European visits grew by 28% in 2017, Georgia remains a “relatively new travel destination” for these markets, as noted by GNTA deputy head Rusudan Mamatsashvili in 2018. Marketing efforts, such as Explore Georgia’s “Ready. Set. Georgia.” campaign, have boosted visibility, but the country competes with established European destinations like Italy or Spain, which drew 14% and 17% of G20 tourism GDP, respectively, per the IMF.
Visa policies further tilt the balance. Georgia’s visa-free regime with 98 countries, including the EU since 2017, has spurred European visits, but the U.S. lacks reciprocal ease, requiring Georgians to obtain visas, potentially dampening bilateral tourism flows. Geopolitical tensions, including the Russia-Ukraine war and protests over Georgia’s 2024 “Foreign Influence” law, may also deter Western travelers wary of regional instability.
Restaurant Business Drop: Underlying Causes
Georgia’s restaurant sector is experiencing a noticeable decline, despite tourism growth. The Hotel Price Index (HPI) from PMC Research reported a 13.2% drop in hotel restaurant prices in November 2023 compared to 2022, signaling broader pressures. Several reasons emerge:
Shift in Visitor Demographics: The influx of Russian (26.7% of 2023 tourism income) and Belarusian migrants, many staying over a year, prioritizes budget accommodations over dining out, per the National Bank of Georgia. These groups, fleeing sanctions and conflict, contribute to tourism revenue but spend less on restaurants.
Economic Pressures: High inflation, noted at 123.6% in tourism revenues in July-August 2022, has raised operational costs for restaurants, squeezing margins. Many have reduced prices or scaled back, as seen in Adjara’s 15% drop in 4-star hotel rates in 2024.
Political Instability: Civil protests in May 2024 over the “Foreign Influence” law disrupted peak season, with hoteliers citing a lag in overnight visits, per PMC Research. This uncertainty may have deterred dine-in traffic, pushing tourists toward cheaper alternatives.
Domestic Tourism Limits: While domestic travel resumed post-COVID, its focus on short trips to rural areas like Svaneti or Racha favors guesthouses over urban restaurants, reducing demand in cities like Tbilisi or Batumi.
Outlook and Opportunities
Georgia’s tourism industry stands at a crossroads, with a $79.7 billion economic impact and 463,400 jobs supported in 2023, per GDEcD. Emerging regions like Svaneti and Kakheti signal untapped potential, yet diversifying its visitor base and stabilizing the restaurant sector remain critical. Targeted marketing to U.S. and European audiences, coupled with infrastructure investments, could elevate Georgia’s global standing, while addressing economic and political challenges may revive its culinary scene. As Governor Brian Kemp noted in 2024, “Georgia continues to grow as a top destination,” but realizing its full potential requires strategic adaptation.
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