Chinese nationals have been allowed to make tourist visits to Georgia without a visa. The changes came into effect on 11 September 2023. This decision contradicts xenophobic statements and steps made by Georgian Dream officials years ago.
Georgia has declared tourism as a priority field and migration legislation is liberal. In total, nationals of around 100 countries, including EU and CIS member states as well as we Turkey, Norway, Switzerland, Iceland, the USA, Canada, Mexico, Brazil, Argentina, Korea, Japan, the UAE, Australia, New Zealand and the Republic of South Africa are allowed to visit Georgia for one year without a visa.
China is one of Georgia’s top trade partners. In 2020-2022, China was the top destination for Georgia’s exports. Despite this fact, however, the number of visitors from China was at a minimum level and China was not even in the top-15 in terms of visitors to Georgia.
Until 2014, Chinese nationals did not need a visa to enter Georgia, although the law was later tightened. Tea Tsulukiani, who was the Minister of Justice at that time, commented positively on "putting pressure on the Chinese. In April 2015, she claimed that the success achieved in terms of the visa liberalisation in the European Union was related to the tightening of the visa regime – a statement which FactCheck verified eight years ago and concluded it was largely false. In May of the same year, Ms Tsulukiani said that the tightening of the visa regime did not affect tourism. FactCheck also verified the aforementioned statement and concluded that it was false.
Previously, in November 2012, according to the then Prime Minister, Bidzina Ivanishvili, "a horrible project was being done" near the Tbilisi Sea. According to him, the "horrible project" meant the compact settlement of 126,000 Chinese nationals. In February 2013, the leader of the Georgian Dasi party, Jondi Baghaturia, repeated the same information. FactCheck concluded that his statement was a lie.
As a result of changes enacted in migration legislation, visa requirements were re-imposed for 24 countries whilst the 360 days of visa-free stay for EU countries were changed to 90 days within a 180-day period. Since 2015, regulations were relaxed and for some people, even more. Russian nationals were allowed to come to Georgia for one year instead of the previous 90 days and Iranian nationals were allowed to make 45-day long visits. However, at that time, Chinese nationals were not among those for whom visa-free travel was restored.
The temporary restriction of visa policy negatively affected tourism statistics. If in 2013 the number of visitors increased by 21%, the growth rate dropped to 1% in 2014. In the case of tourism revenues, the growth rate fell from 22% to 4%.
Over the years, multiple pieces of disinformation about Chinese nationals in Georgia have been disseminated through Georgian media by politicians and other well-known persons. Despite the difference in the numbers they provided, the content was similar – that allegedly tens of thousands of Chinese nationals already lived in Georgia and even more were planned to settle here. Official statistics show a completely different picture.
According to the National Tourism Administration, 59.3 million visits were made to Georgia from 2011 to July 2023. Of these, only 170,000 or 0.3% of them were made by Chinese nationals. The biggest number of visitors from China - 48,000 visited Georgia in 2019. In proportion, the number of Chinese visitors reached 0.6% this year.
Table 1: Statistics of Visitors
Source: National Tourism Administration of Georgia
The abolition of the visa regime means simplifying procedures and making travel cheaper. All other things being equal, a reduction of red tape and a decrease in price led to an increase in demand. Therefore, it is logical to assume that the number of visitors from China will increase, although taking into account that obtaining a visa was not particularly difficult until now, the growth rate should not be on an astronomical scale. If hypothetically the number of Chinese tourists increases ten-fold, it will not even come close to the number of visitors from Russia or Turkey.
It is unknown how much one Chinese visitor spends in Georgia on average. The National Bank of Georgia only publishes the list of the top-ten countries. If we average it, it turns out that they spent a total of USD 78 million from 2011 to July 2023 whilst tourism revenues exceeded USD 26 billion in the same period.
In accordance with the World Tourism Organisation, some 155 million Chinese nationals spent USD 255 billion abroad in 2019. Therefore, even 0.5% of that amount is above USD 1.2 billion, particularly in view of increased tourism expenses. There is a huge potential and to tap into that potential merely by abolishing the visa regime would not be enough.
Tourism is only a part of economic relations. Foreign trade is indisputably outstanding among other parameters. A free trade agreement between Georgia and China has been in effect since 2018. China was Georgia's top export partner for three consecutive years from 2020 to 2022. In the first half of 2023, due to the decrease in demand for copper ores and the increase in re-export of cars to CIS countries, China dropped out of the top three trade partners.
Remittances from China are minimal and stand at less than 0.1% of the total amount. In August 2023, bigger sums were transferred from Lebanon and Oman than from China. The situation was not any different in the recent past. The abolition of the visa-free regime is unilateral as Georgian nationals still need to obtain one for tourism, study or work purposes in China. The decision of the Georgian side will not increase the migration of Georgian nationals to China and, therefore, any massive change in remittances is unlikely. Although Georgian nationals need a visa for the USA as well, from where the amount of remittances was 490 times higher in August as compared to those from China, there is much less interest in migration to China even if only because of the language barrier.
The situation is to a certain extent better in terms of Chinese investments. From 1996 to the first half of 2023, USD 686 million was invested in Georgia from China, amounting to 2.6% of the total investments. Chinese investments peaked in 2014, both in terms of the amount and the share, which was associated with the Youth Olympic Festival which was held the following year in Georgia.
Chinese investments could have been much greater. After the announcement of the tender for the Anaklia deep-water seaport, a Chinese company was considered to be one of the main contenders and an investment of USD 2.5 billion was proposed but then a Georgian-American project won the tender. Nevertheless, the seaport, whose first phase was supposed to be completed in 2020, was not built. Discussions on the possible involvement of a Chinese party in the construction of the seaport were resumed in 2023.
Similar to the seaport, China also did not have much gains in the banking sector. In 2016, the French Société Générale (Bank Republic) decided to leave Georgia. The Chinese Basis Bank took interest in its purchase but was ultimately bought by TBC Bank for USD 315 million. Therefore, the chance that the third largest bank would provide some competition to the two major banks was lost for a long time.
The year 2018 can be considered as a first step for a turnaround when a free-trade agreement between the two countries came into effect. This was followed not only by growth in trade turnover but Georgia’s trade deficit decreased as well. However, of mention is that Georgia’s export to China was steadily increasing in the previous years as well.
In 2023, Georgia and China made a joint statement on the establishment of a strategic partnership and its first outcome was the unilateral abolition of the visa regime. There will be direct flights from China to Georgia starting on 27 September 2023. The simplification of border crossing procedures for people may lead to higher numbers of tourists, although it is unlikely that the growing number of visitors will positively affect economic relations without additional legislative changes or political will.
Georgia and the USA also signed a Charter of Strategic Partnership in 2009. Over the past 14 years, economic ties between the two countries have deepened, although they have not reached qualitatively new heights.
