The escalation of conflict in Iran has impacted Georgia’s tourism sector, with negative effects largely limited to travel and visitor flows, according to a new report by Galt & Taggart "Iran Escalation: Fifty Days on - Assessing Georgia’s Resilience".
The investment bank expects low single-digit growth in tourist numbers in 2026. It notes that higher aviation costs and reduced flight capacity are likely to persist into the first half of the year, shifting visitor inflows toward neighboring countries arriving by land.
Galt & Taggart projects tourism revenues at $4.9 billion, slightly down from a previous estimate of $5.0 billion, assuming that escalation ends in early May. A recovery in regional flights from May is expected to support a stronger rebound in tourism activity.
In the first quarter of 2026, international arrivals remained broadly stable at 1.2 million (-0.2% y/y), while overnight visitors rose 4% to 1.0 million. Tourism revenues increased slightly by 0.5% to $830 million, supported by strong performance in January–February despite a sharp decline in March.
The report highlights diverging trends by source markets, with growth from Russia, Turkey, Ukraine, China, and the EU offsetting declines from Israel, Iran, and India, reflecting the broader impact of regional geopolitical tensions.
