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G&T Team
ResearchResearch Reports Weekly Market Watch

Weekly Market Watch

International arrivals up 510.5% y/y in August 2021 
Total international arrivals (tourists and same-day arrivals) to Georgia increased by 510.5% y/y to 266.5k persons (accounting for 24.5% of August 2019 level) in August 2021, according to GNTA. This growth was mostly driven by 615.2% y/y growth in tourist arrivals from last year’s low base, followed by a 112.5% y/y growth in same-day arrivals. The largest contribution to international visitor growth came from Russia (+809.1% y/y), followed by Ukraine (+28.5x y/y), Turkey (+113.6% y/y) and Saudi Arabia (+16,436x y/y) in August. Overall, in 8M21 total international arrivals stood at 961.6k (-27.1% y/y, 18.5% of 2019 level), of which tourist arrivals reached 883.1k (-3.9% y/y, 25.6% of 2019 level) persons. Meanwhile, we estimate tourism revenues at US$ 752.7mn (+55.7% y/y, 33.2% of 2019 level) in 8M21. 

FDI down 2.6% y/y in 2Q21 
FDI decreased by 2.6% y/y to US$ 234.2mn in 2Q21, after falling by 22.7% y/y in 1Q21, according to Geostat’s preliminary figures. Based on Geostat, the drop in FDI reflected reduction in the amount of equity, transferring of ownership from non-resident to the resident units and payment of debt in several companies. The financial sector was the largest FDI recipient at US$ 82.0mn (+3.2% y/y, 35.0% of total), followed by energy sector at US$ 65.2mn (+107.7% y/y, 27.8% of total), manufacturing at US$ 46.5mn (+192.8% y/y, 19.9% of total) and real estate at US$ 19.1mn (+37.7% y/y, 8.2% of total). UK topped the list of investors with US$ 77.2mn (+30.3% y/y), followed by Netherlands at US$ 31.5mn (-54.2% y/y) and Czech Republic at US$ 30.8mn (+536.1x y/y). Overall, FDI was down by 10.9% y/y to US$ 366.4mn (4.5% of GDP) in 1H21.

International reserves at US$ 4.1bn in August 2021 
Gross international reserves increased by 4.7% y/y to US$ 4.1bn in August 2021 according to NBG. On a monthly basis, the reserves were up by 6.3% (+US$ 243.9mn). Change in reserves reflected receipt of SDR 202mn (equivalent to US$ 286mn) from the IMF under a new procedure for the distribution of SDR's and sale of US$ 30mn on FX market by NBG in August.