Page 27 - GEORptDec21

to $243mn in H1. Inter alia, seasonally, the country boasts the biggest tourism revenues in Q2. Speaking of the first half of the year, though, tourism revenues lagged a massive 79% (down 5-fold) compared to H1, 2019.
The net import of goods (trade deficit with goods), the most important element of the CA, moved within narrower limits - it increased by 5.1% y/y and contracted by 6.8% compared to H1, 2019, to $1.57bn in H1 this year.
Wage remittances, which offset (and finance) an important part of the trade gap, consistently increased: by roughly the same rate of 31% compared to both H1 last year and H1, 2019 to $1.17bn in the first half of this year.
5.1.3 Capital flows
Money transfers to Georgian households surge by 26% in first 10 months
The money transferred to Georgian households through channels such as Western Union or Zolotaia Korona increased by 26% y/y to $1.91bn (over 10% of GDP) in January-October, the National bank of Georgia announced.
These wage remittances sent by Georgians living and working abroad have significantly contributed to the resilient domestic demand that propped up economic growth but also consumer prices this year and in 2020. Compared to the first 10 months of 2019, before the crisis, gross transfers to Georgian households surged by 36%.
In net terms, after deducting the money sent by Georgian households through the same channels ($251mn), the increase was similar: +26.2% y/y to $1.66bn (just under 10% of GDP) in January-October 2021.
In October alone, the gross and net transfers to Georgian households slowed to an annual growth rate of only 13.7% y/y (to $207mn) and 11.7% y/y (to $176mn) respectively. Compared to the pre-crisis period, in October 2019, the transfers were, however, roughly 35% larger in both gross and net terms.
This year, as well as in the previous years, the largest part of the transfers to Georgian households came from Russia: $337mn (+16% y/y). The next largest sources of transfers to Georgia were Italy ($316mn, +31% y/y), the US ($234mn) and Greece ($201mn).
27 GEORGIA Country Report December 2021 www.intellinews.com