Georgia is considered a country of emigration. Since the mid-1990s, emigration from the country has been largely defined as labor migration, with Georgian citizens seeking better prospects abroad to ease persistent socio-economic challenges at home, including high unemployment, widespread poverty, and low wages.  A distinctive feature of this trend is that a significant proportion of Georgian labor emigrants choose to reside and work illegally in their host countries. Meanwhile, for Georgians who opt to emigrate, their primary motivation for doing so is to earn enough to support their families back in Georgia to whom they send remittances to alleviate economic hardships. This bulletin discusses Georgia’s emigration trends and the role of remittances in the Georgian economy at macro and micro levels over the last decade.

In Q3 of 2023, the number of international visits reached 2.3 million visits, recording a 21% YoY increase, however, only reaching 83% of visits in Q3 of 2019. Among the top countries of origin for international visits, in the following periods, visits from Israel are expected to decline due to geopolitical issues. However, visits from China are set to increase gradually with the new visa-free policy. Additionally, India’s tourism market remains promising, despite some border crossing challenges for visitors. In Q3 of 2023, income from international travel reached USD 1.4 billion, which significantly surpasses the pre-pandemic number by 28%, however, showing an incremental 5% rise compared to Q3 of 2022. In October 2023, compared to October 2022, the Hotel Price Index (HPI) in Georgia decreased by 11.1%, with the yearly HPI at its lowest under the “guesthouses” category (-18.7%). Meanwhile, compared to September 2023, the HPI in October 2023 dropped by 11.3%.

In Georgia, the average cost of a room in a 3-star hotel was 152 GEL per night in October 2023, while the average cost of a room in a 4-star hotel in Georgia was 237 GEL per night and the average cost of a room in a guesthouse was 118 GEL per night. The average cost of a room in a 5-star hotel in Georgia in October 2023 was 411 GEL per night. In Tbilisi, the average price was 562 GEL, followed by Guria – 530 GEL, Kakheti – 517 GEL, and Adjara – 319 GEL.    

Following rapid double-digit growth in 2021 and 2022, Georgia's economy in this year is continuing on an upward trajectory, albeit at a slower pace compared to the previous two years. In the first 9 months of 2023, there were several factors that have contributed to growth slowing down. Moreover, there were several factors that presented challenges and opportunities in the economy - examined within the report in detail. Issue 5 of the Macro Overview thoroughly explores different aspects of the economy in Georgia and beyond, including: Economic Growth; Economic and Business Climate; Key Macroeconomic Indicators; Labor Market; External Sector; Global Economic Trends.      

In September 2023, the number of persons receiving a monthly salary increased by 3.9% compared to the corresponding period of 2022. In September 2023, the share of persons receiving a monthly salary up to 600 GEL amounted to 18.6%, which was 4.3 percentage points less than the corresponding period of 2022. In September 2023, the share of persons receiving a monthly salary of 9,600 GEL and more amounted to 1.9%, which was 0.3 percentage points more than the corresponding period of 2022. In 2023, from April to September, the total number of vacancies published on jobs.ge amounted to 44,802, which was 5.4% higher compared to the corresponding period of 2022.

In the first half of 2023, the number of domestic visits amounted to 9.2 million, which is 15% higher compared to the corresponding period of 2022. The upturn in domestic visits this year, following a year-on-year decline in the previous year, was especially pronounced in the Q2 of 2023, where the number of visits rose by 25% compared to the Q2 of 2022. The total expenditure of domestic visitors reached GEL 1.4 billion in the first half of 2023, which is 14% higher compared to the corresponding period of 2022. By categories, in the first half of 2023, compared to the first half of 2022, the expenditure of domestic visitors on shopping (by 17%) and food and drinks (25%) increased significantly. In September 2023, compared to September 2022, the Hotel Price Index (HPI) in Georgia decreased by 10.0%, with the yearly HPI at its lowest under the “guesthouses” category (-14.3%). Meanwhile, compared to August 2023, the HPI in September 2023 dropped by 6.2%.

In Georgia, the average cost of a room1 in a 3-star hotel was 168 GEL per night in September 2023, while the average cost of a room in a 4-star hotel in Georgia was 268 GEL per night and the average cost of a room in a guesthouse was 124 GEL per night. The average cost of a room in a 5-star hotel in Georgia in September 2023 was 495 GEL per night. In Guria, the average price was 780 GEL, followed by Tbilisi – 623 GEL, Kakheti – 514 GEL, and Adjara – 460 GEL.

The Business Association of Georgia (BAG) Index is a joint product of the Business Association of Georgia, PMC Research, and the ifo Institute for Economic Research. The BAG Index summarizes the BAG Business Climate, BAG Employment Barometer, and BAG Investment Environment, which are calculated according to the assessments of the top managers of BAG member businesses and companies in their corporate group. In Q3 of 2023, additional questions were integrated into the questionnaire to assess the investment environment. For the previous reports of the BAG Index, please visit the following link: https://bag.ge/ge/bag-index

In this bulletin, which is based on the ifo Institute’s methodology, we discuss Georgia’s economic climate, informed by the assessments of various Georgian economists. The main findings of the survey of Georgian economists conducted in the third quarter of 2023 are: Georgian economists have a positive assessment of Georgia’s present economic situation. Though their predictions for Georgia’s economic situation for the next six months are negative. 93% of the surveyed economists think that a labor shortage currently represents a high or very high threat to the Georgian economy. Almost 78% of the surveyed economists named a high emigration rate as a high or very high threat. With Turkish Lira hitting a record low, 78% of the surveyed economists think that the decreasing competitiveness of domestic products against cheaper imports from Turkey will have at least a high impact on the Georgian economy.  

In August 2023, the number of persons receiving a monthly salary increased by 4.0% compared to the corresponding period of 2022. In August 2023, the share of persons receiving a monthly salary up to 600 GEL amounted to 19.1%, which was 4.1 percentage points less than the corresponding period of 2022. In August 2023, the share of persons receiving a monthly salary of 9,600 GEL and more amounted to 2.1%, which was 0.4 percentage points more than the corresponding period of 2022. In 2023, from March to August, the total number of vacancies published on jobs.ge amounted to 44,065, which was 10.2% higher compared to the corresponding period of 2022.