Galt&Taggart published Georgia's Tourism Market Watch for September 2022. As of the document, total international visitors stood at 559,887 persons – up 147.0% y/y and recovering at 71.4% of 2019 level. This growth was predominantly driven by the increase in tourist arrivals recovering at 83.8% of 2019 level (up from 77.4% recovery in the previous month). Recovery in same-day trips also accelerated, recovering at 44.0% of 2019 level (down from 47.8% recovery in previous month). Top country by arrivals was Russia (29.1% of total), followed by Armenia (14.9%) and Turkey (14.6%). Number of visitors from Russia, Saudi Arabia, Belarus, Iran, Kazakhstan and Uzbekistan surpassed 2019 levels.

Tourism revenues stood at US$ 375.6 mn in September-22, up 2.3x y/y and surpassing 2019 level by 17.9%. It should be noted that this figure also captures the impact of migrants (from Russia, Belarus and Ukraine) arriving in Georgia since Russia-Ukraine war started. We estimate that about 100-120k visitors from these countries relocated to Georgia for longer term than regular tourists. Russia accounted for 25.4% of tourism revenues in September-22, followed by Turkey (9.5%) and Ukraine (8.4%), while revenues from EU was 11.9% of total. Considering strong revenues of recent months, we expect full recovery of tourism in 2022 compared to pre-pandemic levels.

Hotel demand recovery also accelerated in September-22, attributable to tourism recovery and seasonal trends. Pos payments in Tbilisi medium and large hotels reduced by 13.4% compared to 2019 level, but increased by 43.1% y/y. Recovery in Adjara hotel revenues continued to outperform Tbilisi - pos payments in Adjara surpassed 2019 level by 95% and was up 51.4% y/y.

In 9M22, tourist arrivals stood at 2.7mn persons (+147.5% y/y, 67.8% of 9M19 level) and tourism revenues reached US$ 2.5bn (+190.8% y/y, 97.5% of 9M19 level). From top markets, Russia was the largest contributor to arrival growth, followed by Turkey and Armenia. Out of non-neighboring countries, notable recovery vs 2019 was observed from Uzbekistan (+189.5% vs 2019), Saudi Arabia (+59.4%), Belarus (+94.0%) and Kazakhstan (+32.4%). Highest revenue was sourced from Russia (22.4% of total), followed by EU (10.4%), Turkey (9.4%) and Belarus (8.4%).