18.Dec .2019 17:59

PMCG Research: average prices for hotels have decreased by 5.2% y-o-y

views 113
Back

PMCG Research has published monthly tourism update. The research notes, that according to revised GDP, in 2018 has increased from 41.1 billion Lari to 44.6 billion (8.6% increase), which puts the GDP per capita at 11968 lari. Out of the 8.6% increase, 3% was due to change in methodologies and the rest 5.6% due to improved statistical sources.

It worth to mention, that National Statistics Office of Georgia has introduced new system of national accounts (SNA 2008). There are multiple methodological differences between the current and previous systems, which makes more precise assessment of the GDP possible.

Shadow (nonobserved) economy has expanded considerably – previously thought to be 8.3% now makes up 13% of the total economy. After the revision, structure of GDP has also changed: hotels and restaurants now contribute 4.6% to the GDP structure.

Role of this sector in the economy of Georgia has become one of the fastest growing: since 2010 the sector has increased by 369%, while average growth was only 146%. One of the reasons for such high growth (especially after recaltulation of GDP) is the following: previously, while calculating the GDP 9.2% of Hotels and Restaurants were considered to be non-observed.

Surveys, which were conducted to assess share of non-observed economy in hotels and restaurants, agriculture, construction show that the share of non-observed activity for hotels and restaurants is significantly higher at 54.3%.

According to the National Statistics Office of Georgia visitors have spent 3.3 billion lari in Georgia in the third quarter of 2019. Biggest share in the expenditures are foods and drinks, while 24.6% of visitors total expenditures are spend on accommodation (290.3 Lari on average). As the expenditures spent by visitors in Georgia are expected to increase, the sector will become even more vital for the economy in the future.

In October 2019, in Georgia the hotel price index3 decreased by 5.9% compared to September 2019. The 3-star, 4-star and 5-star hotel price index decreased by 5.9%, while for guesthouses, the price index decreased by 6.2%. In October 2019, compared to October 2018, hotel prices in Georgia decreased by 5.2%. The prices of 3*, 4*, 5* hotels decreased by 6.7%, while the prices of guestouses decreased by 1.2%.

According to PMCG Research, in Georgia, the average cost of a room1 in a 3-star hotel was 138 GEL per night in October 2019. While the average cost of a room in a 4-star hotel in Georgia was 215 GEL per night and the average cost of a room in a guesthouse2 was 69 GEL per night.