TBCCapital published a report on Tourism Monthly Watch. According to the report, international visitor trips continued to grow in February, registering recovery of 40% during the two months in 2022. Conditions for tourism were far better compared to previous year, favorable weather for ski season, unrestricted flights, – hence the impressive YoY growth of international visitor trips.
International visitor trips through air borders amounting to 51% of total trips showed 71% recovery, while trips through land borders with slightly less share 48%, recovered by 28%.
Airport of Tbilisi was the busiest border amounting to 36% of all trips to Georgia. This was followed by Sarpi (Turkish border) with 16% share in total trips, Kazbegi (Russian border) - 12%, Sadakhlo (Armenian border) at 9%, and Kutaisi Airport at 7%. The sum of international visitor trips from these five borders accounted for 81% of all trips. Most visitor trips to Georgia were conducted by male visitors 73%, while female trips amounted to 27%. The largest number of visitor trips were within the 31-50 age category – 53%.
Half of international visitor trips were from neighboring countries, significant decline of their share compared to 73% registered in February 2019. Turkey held the lead with 19%, followed by Russia - 14% and Armenia - 11%. The leader among the non-neighboring countries were Ukraine and Israel with the same share of visitors - 6%.
The share of the EU+UK increased and totaled 8%. The highest number of international visitor trips from the EU was registered from Poland (16%), the UK (13%), Germany (11%), Lithuania (9%), and France (7%).
The Middle East accounted for 5% of all visitor trips, up from 1% in February of 2019. The Middle East was primarily represented by the following countries: Saudi Arabia (31%), Kuwait (15%), Jordan (9%), Egypt (5%), and Lebanon (5%).
According to the report, the recovery in the neighboring countries maintained slow pace in February 2022, with Azerbaijan registering the lowest rate among the neighbors (5%). Highest recovery was for Israel and the Middle East, constituting 123%, and 158%, respectively. The United States and the European Union also maintained a high level of recovery in February 2022, 80% and 77% respectively.
The larger number of international visitor trips translated into higher revenues from international travel, the latter showing significant 62% recovery in February 2022. This indicator recovered even stronger by 66% during the last two months.
The decreased share of neighboring countries in international visitor trips resulted to larger decline in their share in international travel receipts from 56% to 33% in February of 2022 compared to same period of 2019.
Ukraine and Israel have notably exceeded the results of 2019, with shares totaling 10% for both in international travel receipts. The EU’s share marginally increased and amounted to 15% relative to 2019. The share of Saudi Arabia from the Middle East countries posted sizeable increase relative to the same period of 2019.
In February 2022, Russia, Ukraine, EU+UK, Turkey, and Israel were major sources of tourism receipts. Visitor trips translated differently in travel revenues for different countries: Armenia, holding 11% in visitor trips contributed moderate 4% to travel receipts, while Ukraine held 10% in the revenues with only 6% share in international visitor trips.
Non-cash expenditure of non-residents through all channels in Georgia showed positive trend, while through TBC Bank channels, it exceeded 2019 level by 41%.
In February 2022, the average occupancy improved compared to February 2019 by 11 percentage points. The reasons behind a better performance might lie in a limited choice of hotels (caused by the pandemic), domestic tourism and war in Ukraine. Kakheti continued to enjoy high occupancy levels. Average occupancy in hotels in other region decreased, relative to February 2019.
Average daily rate in large, brand hotels decreased by 20% in February relative to February 2019. The decrease of ADR indicates hotels attempting to keep occupancy high and mitigate the affects of a new wave of the virus.
Relative to 2019, non-cash spending in hotels, through TBC Bank’s channels, decreased by 7% in February. Hotels across the regions surpassed its 2019 level by 40%, while in Tbilisi, this indicator was 39% behind. In February 2022, in hotels with 50-120 rooms, growth of non-cash spending, through TBC Bank’s channels, moved to the positive growth territory, amounting to 2% relative to 2019. Expenses in hotels with more than 120 rooms remained behind 2019 level by 31%. Spending moved in negative growth territory in Hostels and small and family hotels.
In February 2022, the share of international visitors in non-cash spending in hotels of Georgia, through TBC Bank’s channels, totaled 79%. The share of international visitors in total non-cash expenditures in hotels was highest in MtskhetaMtianeti (91%) (due to arrivals in Ski resort of Gudauri), in Tbilisi (86%), and Adjara (69%), whereas spending by domestic visitors was dominant in kvemo Kartli, Kakheti, and RachaLechkhumi & Kvemo Svaneti.
Distribution of non-cash spending of international visitors in hotels was uneven among the regions. The share of Mtskheta-Mtianeti comes after Tbilisi due to the start of the winter season in Gudauri and Kazbegi. The same reason explains the high share of Samtskhe-Javakheti, famous for winter resort Bakuriani.
"As the war unfolds in the region, measuring its possible negative impacts on Georgian tourism industry becomes extremely important. We assessed the outcomes of the war in Ukraine for the tourism industries under two possible scenarios: timely and delayed resolution of war. In these scenarios tourism recovery is stronger than in previous two years due to the varied effect of war on source markets. Ukraine, Russia, Belarus, and Armenia the major source markets for Georgia are affected the most by economic implications of war. Furthermore, war creates a risk for the region to be perceived as an unsafe destination by markets such as EU, USA. Middle East and Israel stay on growth territory in
both scenarios. Migration caused by the war might push up travel receipts. In timely resolution scenario migration lasts for a shorter period and adds around USD 60m to tourism receipts. In delayed resolution scenario migration is responsible for additional USD 110m of tourism receipts", - the report reads.
