Turnava Meets with Banks & Hotels Amidst Tourism Crisis

Minister of Economy and Sustainable Development Natia Turnava is moving quickly to prevent an economic crisis and avoid the collapse of one of Georgia’s biggest industries, tourism, in the midst of Russian bans on flights to Georgia and anti-Georgian fearmongering in Russia.

Last week, Turnava announced that the government was working on a package of financial assistance for companies operating in the tourism sector as part of their anti-crisis plan.

Moscow’s flight ban, which will begin on July 8, will leave an estimated 155,000 Russians unable to use tickets they already purchased. 3,500 people who booked tours to Georgia with travel agencies in Russia have already had their trips cancelled. The ban is expected to hit the Ajara region particularly hard.

“No matter how diversified our market is, the share of Russian tourists is high, at 25%. Therefore, we cannot say that this is not a problem. We expect the loss of around $750 million of income. But now we are working on ways to reduce the expected impact,” said Turnava last week.

Continuing her plan to keep the tourism-reliant economy moving during the high summer season, Turnava met on Wednesday with representatives of two industries that interact intensively with tourists from Russia: hotels and banking services.

Meeting with representatives from international brand-name hotels, Turnava discussed how the new challenges in the sector can be overcome, and how the ministry can support the private sector. After the meeting, she told reporters, “We discussed with the representatives of the brand hotels how we can help them in logistics – it might be new flights, charter flights, financing of certain transfers, some financial support and using the existing financial mechanisms we have. It is important that the field is balanced in evaluating the process since it is about revealing new opportunities for attracting tourists from different markets, as well as about maintaining the traditional market and the Russian market as well.” The Ministry of Economy says the meeting aimed to help businesses “find ways of softening the negative effect [of the flight bans] that is a challenge to the tourism industry.”

Turnava also declared Georgia an “open, hospitable country, a safe tourist destination and an open market for Russian tourists.”

After meeting with representatives of commercial banks, Turnava explained that “We are talking about the challenges that our tourism industry faces...It is possible to find various financial support schemes and financial products, including credit-guarantee mechanisms, to overcome the challenges we face at this point. Very soon, we will be ready to offer our tourism industry a certain plan.”

They also discussed a planned initiative to reduce the negative impacts of the flight ban, focused on small and medium-sized enterprises.

“Representatives of the commercial banks positively assessed the initiative of the Minister... confirmed their active support, and expressed hope that the directions of the tourism sector will be soon established via joint efforts,” reported the Ministry of Economy.

By Samantha Guthrie

Image source: Ministry of Economy and Sustainable Development