Report: tourism in Georgia to grow 40% in 2017

IMF forecast inflation in Georgia will reach 2.6 percent this year and 3.6 percent next year. Photo by N. Alavidze/Agenda.ge.
Agenda.ge, 26 Apr 2017 - 18:35, Tbilisi,Georgia

Georgia has emerged as one of the world’s fastest growing air travel markets in the world, driven by a booming tourism industry and a liberal aviation policy, says the recent report from the CAPA Centre for Aviation.

This small country at the crossroads of Europe and Asia recorded passenger traffic growth of 26 percent in 2016 and expects even faster growth of approximately 40 percent in 2017,” says CAPA, which offers independent aviation market intelligence, analysis and data services.

CAPA Centre for Aviation published a two part report on the Georgian aviation market, providing a case study on how a liberal approach to aviation can have a significant positive impact.

The report highlighted some positive developments for 2017 and pointed out the most successful achievements of 2016.

Several airlines are adding capacity of launching services to Georgia in 2017. For example, three Russian airlines are launching services to Georgia at the end of May-2017 or early June 2017 – Nordavia, Severstal and Red Wings (based on OAG data).

Ukraine’s Dniproavia and FlexFlight and Greece’s Ellinair are planning to resume seasonal services to Georgia this summer (based on OAG data). Air Arabia has just expanded in the Georgia market with a new route from Amman which was launched in early April 2017 by the group’s Jordanian affiliate.

Georgian airports handled 2.84 million passengers in 2016, according to Georgia Civil Aviation Agency data. Total passenger traffic increased by 25.6 percent in 2016, making Georgia one of the fastest growing aviation markets in the world.

Georgia relies heavily on tourism

In 2016 Georgia recorded 1.067 million visitor arrivals by air. Inbound visitors therefore accounted for approximately 75 percent of total passenger traffic at Georgia’s airports.

The number of visitor arrivals by air increased by 40 percent compared to 2015, when visitors accounted for approximately 68 percent of total Georgia traffic. In 2013 visitors accounted for 64 percent of total traffic.

The outbound market (Georgian citizens travelling abroad) has grown only slightly over the past five years. The outbound market declined slightly in 2016 – likely the result of a relatively sluggish economy; Georgia’s GDP grew by less than three percent in 2016, said the report.

Tourism is an increasingly important industry to Georgia’s economy. Tourism accounted for 7.1 percent of Georgia’s total GDP in 2016. In 2013 tourism accounted for less than six percent of the country's total GDP,” said CAPA Centre for Aviation.

Georgia picking up Turkish tourism decrease

Georgia has benefitted from instability in Turkey as tourists who would be holidaying in Turkey look for other alternatives, said the report. In the most recent month, March 2017, Georgia reported a 68 percent increase in visitor arrivals by air, to 101,000.

The rate of growth will probably not be as strong in the peak summer season but the volume increases will be more significant. Georgia typically has twice as many visitor arrivals in July and August than in March,” said CAPA Centre for Aviation.