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“Thank you for being part of the adventure... Long live Georgia!” were the words that Bushmala posted on social media to bid farewell to their customers. After winning a culinary show, the brother and sister decided to open a fast-food café on Simon Chikovani Street in Tbilisi. The name and concept were inspired by their childhood memories: “The Bushmala tree grew in our garden in Zestaponi, a city in the east of the country.
We used to climb it when Gran was angry with us; we played there and looked out into the street, tossing the fruit at each other. The concept of our café menu was inspired by the taste of the fruit, which we have modernised,” said Nodar Turashvili, the co-founder of Bushmala.
Three family members and three hired employees worked at the café. Nodar said that their business had been successful, showing steady growth. “By the end of November, our income equaled our expenses. We expected to make a profit after that, because we had worked for a year and a half to reach that point and had put all our resources into the business. However, from December onwards, things slowed down dramatically. We had to consider whether it was viable to continue amassing debt or to close down. As the future seemed rather bleak, we didn’t want to risk getting into debt under such uncertain conditions.”
The final decision was an emotional one for the entire team. Nodar told us: “Frankly speaking, it was painful to think about closure, but we hoped it would coincide with an improvement in the country's situation. At the moment, it’s impossible to predict anything, even for a day. But we are hopeful and deeply believe that one day we’ll get back to where we were.”
Bushmala isn’t the only business to go out of operation. The Restaurant Association, which lists 650 food and catering businesses across Georgia, also highlights the crisis in the sector. Shota Burjanadze, the association's founder, explained: 'It’s difficult to give exact figures, but right now, at least one restaurant is closing or being put up for rent or sale every day.' He believes that the Horeca sector has been adversely affected by the lack of local customers and the decreased number of tourists.
‘Considering the current events, it’s no surprise that we have fewer visitors from Europe. The overall situation has affected them’ – Tamuna Dolidze
“From 2023 to 2024, the Horeca sector often complained of a shortage of staff, so we were constantly looking for people to work in the industry. But now the situation is unprecedented – demand for jobs is higher than supply,” said Shota Burjanadze. The founder of the Restaurateur Association told us that it’s mainly small restaurants that are closing, but some large ones too. He added that they had experienced a serious crisis during the pandemic, but that it’s different now because of the uncertainty: “We have no idea what might happen in the future.”
It isn’t just the restaurant business talking about the crisis and uncertainty. “There are no customers. We used to have groups of visitors who came for wine tasting, brought by their guides. This month, we hardly had any groups at all. The situation is worse than it was in December,” said Nikoloz Shekriladze, General Manager of Villa Harvest Hotel (Villa Mosavali).
The hotel, which has its own vineyard and wine cellar, is located in Akhalubani, a village near Tbilisi. Throughout the year, the hotel hosts many local and international visitors, as well as conferences and wine cellar tours. However, Mr Shekriladze told us that the situation changed for the worse at the end of 2024: “This time last year, we had visitors every three or four days. Now, we might have only one group per month, mainly foreigners. They are mostly interested in the vineyard, wine tasting and visiting the cellar. This month, we have had two wine-tasting groups. During the same period last year, wine tasting was organised at least once every four days.” Mr Shekriladze said that bookings for conferences and similar events had been cancelled.
Seventy employees work at Villa Harvest. Despite the crisis, the company says that they are trying to keep the staff.
“Considering the current events, it’s no surprise that we have fewer visitors from Europe. The overall situation has affected them, so they have cancelled their tours. When someone new arrives, they primarily ask if it’s safe to travel to Georgia. We explain that protest rallies are still being held, but they are not dangerous for tourists. But they still aren’t convinced – safety is the most important thing for Europeans,” said Tamuna Dolidze, operations manager at the tourist company Winglet. She also said that tourists from Asia aren’t affected in the same way: “No bookings have been cancelled by visitors from India or China. They seldom ask whether the situation is dangerous, and they trust our explanation. Europeans are more cautious.”
Official statistics vs. private sector’s numbers
According to official statistics, 6.5 million international visitors came to Georgia in 2024. Among them, 5.1 million were tourists, while 1.4 million were transit arrivals who stayed for only one day. For the first time, the latter figure equaled that of 2019, the last year before the pandemic.
The most dynamic tourist flow was recorded in the first quarter of 2024, but the numbers declined in the following quarters. Research by the investment bank Galt and Taggart cites “political instability in the country” as a significant factor in the decline in visitors, particularly from the European Union. According to the National Statistics Service, growth in visitor numbers was mainly driven by demand from Asian countries such as China, India, Iran and Saudi Arabia.
According to the National Tourism Administration (NTA), 2024 saw a record number of international tourists, with growth of 9%, as well as record income for the country of 4.4 million USD. Ms Maia Omiadze, the NTA's Head, later expressed optimism regarding 2025. However, the private sector has a different view: Shalva Alaverdashvili, co-founder of the Hotel Federation, said that it was humiliating for the sector to claim a record income when, in reality, hotels are obliged to lower their prices to their lowest in recent years in order to survive.
Mr Alaverdashvili reiterated that 'the prices haven’t been so low in Tbilisi for 30 years'. He pointed out that the capital’s hotels were in the worst possible situation, which had had a negative effect on employment and resulted in staff numbers being reduced. 'In December 2024, it was down 35% compared to December 2023, and in January 2025, it was down 38% compared to January 2024,' he told us.
Mr Alaverdashvili states that the NTA’s figures are far from reality, which is much gloomier than the authorities would like to believe. The NTA says that it is not true that Georgia has fewer tourists. The problem is the insufficient number of hotel rooms. Business has expanded; consequently, if a hotel doesn’t have visitors, they have gone to another hotel”. According to Galt and Taggart Research, Tbilisi hotels' occupancy rate in the fourth quarter of 2024 was 48.5%, compared to 51.4% in the same period of 2023. Meanwhile, the average price of a hotel room fell from 95 USD to 85 USD. Similarly, Airbnb prices have dropped. In 2024, the average price was 50 USD, representing a 4.6% annual decrease.
Tourist boom or economic crisis?
Last February, Transparency International – Georgia published a report entitled The effect of the internal political crisis and the sanctions on the Georgian economy. According to this research, the sanctions imposed by Western countries and the internal political crisis are already having a partial influence on the Georgian economy, as evidenced by the slowdown in economic growth, the devaluation of the lari (GEL), the reduction in National Bank reserves, and the deterioration of the investment climate.
When considering future prospects, the paper refers to the PMCG Georgia’s Economic Climate Report. According to this report, economists negatively assess the current economic situation in the country and foresee its worsening in the coming months. 'Generally speaking, expectations play a significant role in the economy. When they are negative, investments decrease and the population and businesses adopt a wait-and-see approach, which reduces economic activity,” writes Transparency International – Georgia.
According to experts, the change in the economic situation depends on the scale and scope of the expected Western sanctions. Considering the specific nature of Georgia’s economy, the organisation does not rule out the possibility that worsening foreign relations could cause significant devaluation of the lari and consequent inflation.
The tourism sector and the hospitality industry are caught between two realities: official reports claim growth, but local businesses are experiencing a dramatic decline. Statistics show that the number of international tourists has reached the 2019 level, but the private sector is not seeing any tangible income from this. Hotels and restaurants are forced to reduce prices, cut staff numbers or close altogether.
Clearly, the political crisis and uncertainty are having the greatest influence in this respect. It will be interesting to see how the crisis affects the Georgian economy in the long term and whether the government will address the issues raised by the private sector.
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