Covid-19 Impact on the Georgian Tourism Sector

Abstract

The coronavirus has caused an economic crisis not only directly in the tourism sector, but also in areas directly and indirectly related to it. Capital turnover decreased from 2089.1 million to 690.1 million compared to the previous 2019. In February 2020 alone, the number of international tourists decreased by 0.7% compared to the same period last year. The decrease in tourists was reflected in the restaurant business, the turnover of shopping facilities, etc. Compared to 2019, the number of employees in hotels and restaurants alone has decreased by more than 18 thousand people. A significant decrease was also observed in the Imereti region. Corona virus COVID-19 poses a significant threat to both the global and regional economies. Today, the negative impact of the pandemic on the world economy has become irreversible. It is impossible to make an accurate forecast in today’s rapidly changing environment. The first case of kovidivirus in Georgia was detected on February 26, 2020, and already in March the visible effects of the pandemic began to be detected:  Increased demands on products;  The inevitable rise in unemployment;  Reduction of international remittances;  A sharp decrease in the flow of foreign tourists, etc. Recently, tourism has become one of the leading sectors of our country's economy, accounting for 11% of Georgia's GDP. The number of visitors in 2019 exceeded 9.3 million, which was 7.8% more than in the previous 2018, the increase was visible every year. With this in mind, the number of visitors was expected to increase to 10 million by 2020. The coronavirus has dealt one of the biggest blows to world tourism and caused an economic crisis. Georgia is no exception. The aim of our paper is to determine based on a comparative analysis of statistical materials provided by Geostat, the Agency of Protected Areas and the National Tourism Administration how much the Covid virus has changed the expected results in the tourism sector as a whole in the country and in the Imereti region. COVID-19 has had the most negative impact on the tourism industry precisely because of closed borders and fears of travel. According to the analysis of the World Tourism Organization (UNWTO), which considers the SARS scenario of the pandemic in 2003 as a potential model, world tourism should expect a 1-3% decrease in visitors, while according to the forecast made in 2019, the number of visitors in 2020 is 3-4% Should increase global tourism to a total loss of $ 30-50 billion (UNCTAD, 2020: 9.03). The global tourism crisis has had a big impact on Georgia as well, already in February 2020 the number of international tourists decreased by 0.7% compared to the same period last year. However, during the same period, there was a certain increase in some countries, in particular, a 161.5% increase was observed in tourists from Estonia in February. Significant increase in tourist flow was also observed from other EU countries: Poland - 84.8%. Italy - 81.2%, France - 52.4% and Germany - 38%. Since travel restrictions have already been extended to virtually all countries, including neighboring Azerbaijan and Armenia, the impact on the tourism sector has clearly increased. Closed borders and travel restrictions will hurt Georgia's tourism sector and likely slow down the market diversification process. To assess the scale of the economic impact, it should be noted that according to official data for 2018, 44,663 people were employed in hotels and restaurants alone; In 2019, there were 48,634, the same data as 38,661 people in the first quarter of 2020, which decreased to 30,215 people in the second quarter. That is, compared to 2019, the number of employees in hotels and restaurants alone has decreased by more than 18 thousand people. And capital turnover decreased from 2089.1 million to 690.1 million compared to the previous 2019 (data for 2 quarters of 2020). The same data in the Imereti region in 2019 amounted to 2536 people. There is also a significant decrease in the number of visitors to protected areas. Analyzing the statistical materials of the Agency of Protected Areas, we find that 112612 visitors (including 21176 foreigners) visited the Protected Areas of Georgia during the first 7 months of 2020, the same figure was 1,199,011 for 2019, ie only 11.6 % of the total number of visitors in the previous year. If we take into account the fact that in previous years the number of visitors in the first five included 3 protected areas from Imereti - Prometheus Cave, Sataplia and Okatse Canyon this year only Prometheus Cave entered the top five and it is in the third place with 10,581 visitors. In 2019, it was visited by 184,264 visitors. The situation is the same in Okatse Canyon last year it hosted more than 92 thousand visitors, this year only 52 96 (instead of the projected 100 000 visitors), Sataplia visited 6002 visitors in 7 months in 7 months, the same figure in 2019 was 741988 visitors. The number of visits to the above facilities alone shows how big the difference is in the number of visitors of the past and present years. Added to this are the indirectly related sectors of tourism, which clearly shows the economic crisis in the tourism sector of Imereti. It is hoped that the corona virus COVID-19 will soon be overcome in the world, including Georgia, and will start economic progress, including in the tourism sector. It is also encouraging that National Geographic, one of the most influential travel publications in the world, has named Georgia, Svaneti region, among the top 25 destinations in the world in 2021, which tourists should visit in the post-pandemic period. The American travel magazine "Thrillist" describes the 13 best countries, where it advises American citizens to live, in which it names Georgia among the popular tourist countries. The journalist of the publication recommends using the project "Work from Georgia" to come to Georgia. The Georgian government has eased visa requirements for participants in the project, and with the new "Work from Georgia" program, foreigners can work remotely from Georgia and spend a full year in the country, earning at least $ 2,000 a month. - The author of the article writes and notes that Georgia attracts travelers to the Caucasus Mountains, Georgian cuisine, wine and affordable prices (nationalgeographic, 2020). According to the National Tourism Administration, up to 1,100 citizens from different countries were registered within the framework of the project "Work from Georgia" from August 27 to October 25. Hopefully, more travelers will be interested in this project, they will come to Georgia, including the Imereti region, which will at least partially improve the economic situation in the country's tourism sector.

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