Georgia’s Tourism Market Watch – 1Q26

Visitors

International visitor arrivals decreased marginally by -0.2% y/y to 1.2mn in 1Q26, with tourists rising by 4.0% y/y to 1.0mn, while same-day visitors declined by 19.0% y/y to 0.2mn. Visitor growth from Russia (+5.2% y/y), Türkiye (+5.8% y/y), Ukraine (+24.5%), China (+48.6%), and the EU (+30.2% y/y) offset sharp declines from Middle East, India, Armenia and Azerbaijan in 1Q26. Visitors from Israel fell 17.5% y/y and from Iran 48.8% y/y, reflecting the ongoing Iran escalation and its impact on regional air routes. Arrivals from India dropped 29.5% y/y, driven by two factors: IndiGo's suspension of Tbilisi flights on Feb-4, following drone strikes near the Iran-Iraq border, and disrupted air connectivity to Kutaisi via Middle Eastern hubs.

We project low single-digit growth in international tourist arrivals for the full year 2026. War-related headwinds, including rising aviation costs and reduced air connectivity, are expected to persist through 1H26, shifting the growth mix toward land-based arrivals from neighboring markets. Sustained momentum from China, the EU, and Russia in air arrivals is expected to support full-year growth. A potential reopening of the Azerbaijani land border ahead of the Jul-26 deadline also remains a meaningful upside.

Revenues

Tourism revenues rose marginally by 0.5% y/y to US$829.8mn in 1Q26. Growth was led by the EU (+36.4% y/y), Türkiye (+12.2% y/y), Ukraine (+34.2% y/y), and Saudi Arabia (+47.6% y/y), broadly in line with visitor trends, while other Middle Eastern markets contributed negatively in 1Q26.

We forecast tourism revenues at US$ 4.9bn in 2026, revised downwards from the previous estimate of US$ 5.0bn, assuming that the Iran escalation proves short-lived.