ISET Economist Blog

A blog about economics in the South Caucasus.

Kazbegi Rooms: with a View to Improvement of Regional Development Policies

When planning a debate about the impact of the new Rooms hotel on the local community in Kazbegi we expected it to be a mixed bag. A colleague who visited Kazbegi Rooms on a private reconnaissance mission told us how much he enjoyed his stay, but added: “for some reason, the relationship between the hotel and the villagers is best described as complex”. As economists, we assumed that Rooms would be a major employer of locals and so the only issue could be competition for tourists between the hotel and the local bed & breakfast providers. And as is of...
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Guest — AP
Great piece!
Friday, 05 September 2014 3:03 PM
Guest — Hans Gutbrod
great piece, Eric. Hopefully lessons will be learned...
Friday, 05 September 2014 4:04 PM
Guest — William Dunbar
Nice piece, but Kazbegi is on the Tergi (Terek), not the Aragvi
Friday, 05 September 2014 5:05 PM
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Travel and Tourism to Georgia: Making Sense of Definitions and Numbers

Travel and Tourism is one of the largest and fastest-growing service industries globally. According to the World Travel and Tourism Council (WTTC), the industry’s direct contribution to World GDP in 2012 was US$ 2.1 trillion (2012 prices) and it supported 101 million jobs. Taking account of its combined direct and indirect impacts, WTTC assesses Travel & Tourism’s total economic contribution at 9% of World GDP in 2012, 1 in 11 jobs, 5% of total economy investment and 5% of world exports (Economic Impact of Travel and Tourism 2013, Annual Update, WTTC...
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Guest — RaTi Kochlamazashvili
Hello,When you're saying that the share of tourism industry in the World GDP is US$ 2.1 trillion (nominal, 2012 prices) and suppor... Read More
Monday, 18 November 2013 3:03 PM
Guest — Giorgi Bregadze
Hello, Thank you for your remark. Please pay attention that here we are talking about "direct" contribution not "total". Source:... Read More
Friday, 22 November 2013 6:06 PM
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The "Wizz Air Effect" or how Georgia Became Part of the Global Economy

On Monday evening I am taking the express train from Tbilisi to Samtredia with my wife and two kids (business class, 120GEL). We plan to stay overnight in a little family hotel (40GEL), and at 6.30am we’ll board the Wizz Air flight to Katowice, Poland, at the cost €40 a person and €35 per suitcase (one way). Seat reservations, luggage, train and guesthouse included, the roundtrip to Poland will cost my family around €700 compared to €1,500-2,000 using any other, conventional option. A real bargain! (even if we ignore the fact that my wife’s family is act...
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Guest — Mathias
I am curious to hear about the Kutaisi airport experience. Kutaisi is operated by a government owned company which still hasn't ma... Read More
Monday, 15 July 2013 10:10 AM
Guest — Eric Livny
Mathias, thanks for raising these very important questions. I tried to look up the TAV concession agreement but so far was not suc... Read More
Monday, 15 July 2013 12:12 PM
Guest — Daniel
The Kutaisi Airport is somewhat a child of the old, pre-2012 government. Saakashvili wanted to scatter airports around the country... Read More
Tuesday, 12 November 2013 5:05 AM
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Jobless Growth in Georgia

There is no arguing that during the ten years since the Rose Revolution, the Georgian economy registered an impressive growth performance, averaging 6.6% per annum. Summing up Georgia’s post-2004 growth experience, a recent ISET-PI study (Babych and Fuenfzig (2012)), finds it “remarkable not only in light of the 5.3 percent average growth rate in the 1995-2002 period, but also considering that the average GDP growth rate for European and Central Asian developing countries was about 5.1 percent in the period between 2003-2010.” Yet behind the gliste...
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Guest — test
Tuesday, 23 April 2013 8:08 PM
Guest — Eric
test 5
Tuesday, 23 April 2013 9:09 PM
Guest — M
What is the evidence for the alleged skill mismatch? When me and Yasya were working on the growth diagnostics study we were lookin... Read More
Thursday, 25 April 2013 3:03 PM
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Detecting Tourism Bottlenecks

Travel and Tourism Competitiveness Index of UN (T&T CI) ranked Georgia 73, in 2011. With this rank, Georgia topped South Caucasus region nevertheless, maintaining the same rank as in 2009. This could mean that not much had improved during those three years in terms of competitiveness of Georgia as a brand in the business of tourism. Looking at the data on international tourist arrivals and international tourism receipts – they both have been steadily increasing since 2000. From the first glance this upward trend seems promising. We have more tourist...
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Guest — Leqso
Indeed, expensive flight tickets are one of the key challenges for Georgian tourism industry, however bearing in mind that only sm... Read More
Thursday, 20 December 2012 11:11 AM
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Touristic Destination or Trade Corridor?

Georgia’s competitiveness is said to hinge on its strategic location between East and West. The latest data on border crossings (by people and trucks) allow to shed light on progress to date and take a glimpse into the future. The efforts to develop Georgia as a major touristic destination in recent years seem to have paid off. The number of international arrivals to Georgia has been growing rapidly, reaching 2,822,363 in 2011. In the first 11 months of 2012, the number of visitors exceeded 4mln, which is 58% more than in the same period of 2011. Interna...
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