Institute for War and Peace Reporting | Giving Voice, Driving Change

Georgia's Last Resort

The Georgian government is currently considering reforms aimed at breathing new life into the republic's ailing tourist trade
By IWPR

The legacies of war and economic crisis have conspired to cripple Georgia's tourist industry which was once the pride of the Soviet Union.


Annual figures for people visiting the republic have plummeted from four million in Soviet times to less than 400,000 in 1999. The number of hotel rooms has dropped from over 100,000 to just under 9,000, according to the State Department for Statistics.


The process of decline began shortly after the collapse of the USSR and was accelerated by the war in Abkhazia. Until this time, Georgian resorts had been a favourite retreat for Communist Party bigwigs and around six per cent of tourists were foreigners.


The civil war cut a swathe of destruction through the 19 Abkhazian resorts, which once attracted a third of all holiday-makers visiting Georgia. A spokesman for the Abkhazian Ministry of Security said the tourist industry in the breakaway region had simply ceased to exist, with only a few Russian military families staying in health spas protected by federal troops.


Railways between Russia and Georgia, which once brought most tourists across the border, were also destroyed during the war. Facilities at Tbilisi airport remain basic whilst most major roads are in a bad state of disrepair. Standards of service at hotels have a poor reputation.


Any attempts at resurrecting the industry have typically been dogged with bureaucratic and economic problems. Although most resorts have been privatised over the last 10 years, any flow of investment has been choked by the republic's rigid tax laws. One foreign entrepreneur who invested 12 million lari ($6 million) in the Bazaleti Lake complex has appealed to the government for urgent tax reductions.


Concerns over security and political stability have also kept foreign money - and foreign tourists -- at bay. An interior ministry department responsible for investigating crimes against foreigners has been closed down whilst some remote regions have become no-go zones for the police authorities.


Residents in the picturesque district of Svaneti, potentially a tourist haven, report numerous incidents of visitors being robbed by gangs of brigands. One villager, Gogi Subeliani, said the police had lost control of the situation and the good will of the locals was not enough to guarantee security.


The Black Sea resorts outside Abkhazia are patronised exclusively by Georgian holiday-makers with little disposable income who generally rent rooms in private homes. Coastal hotels are notoriously expensive, prompting better-off tourists to head for Turkey or Cyprus where room rates are far more reasonable.


But, despite the atmosphere of despondency, there have been several success stories over the last few years. Family guest-houses have sprung up across the mountainous regions of northern Georgia, often saving their proprietors from the poverty trap. Here peaks such as Ushba, Skhara and Tetnuldi remain a popular destination for mountaineers while historic towers built in the 11th to 17th centuries have been preserved as national monuments.


Eter Vibliani, a local tour operator, says the number of tourists visiting the mountain regions is increasing steadily and tourism is the biggest growth industry here.


Meanwhile, the Gudauri skiing resort has profited from major Western investment. Austria's Marco Polo chain operates the 120-room Gudauri Hotel, a four-star luxury establishment built in 1988. Around 65 per cent of visitors are foreigners, although the hotel still runs under capacity.


It is an example the Georgian government regards with undisguised envy. The State Department for Tourism and Resorts has calculated that, given another 8,000 hotel rooms across the republic, Georgia would be able to host one million tourists every year and secure a revenue of one billion lari ($500 million). In 1998, the combined income of Georgia's hotels totaled a paltry 18 million lari ($9 million).


Tourism chiefs have been studying the model established by Turkey in the 1980s under the leadership of President Turbut Ozali. Gigi Kuparadze, deputy head of Georgia's tourism department, said reforms aimed at encouraging investments in Turkish resorts paid off in just six years.


A similar programme had been presented to Georgian President Eduard Shevardnadze and was currently being considered, said Kuparadze. The proposals covered tax reduction, investment opportunities and measures designed to stimulate growth.


Vakhtang Komakhidze is a freelance correspondent from the Independent Journalists' Club