Tourist arrivals up 29.7% y/y in April 2017
Total international arrivals to Georgia increased 10.2% y/y to 0.51mn visitors in April 2017, according to the Ministry of Internal Affairs. Arrival growth was mainly driven by surge in tourist arrivals increasing 29.7% y/y to 0.22mn persons (43.6% of total) in April after posting a 28.6% y/y growth in March 2017. Out of top countries by arrivals, in April 2017, visitors continued to increase from Armenia (+13.2% y/y), Russia (+16.5% y/y), Ukraine (+27.2% y/y) and Azerbaijan (+7.1% y/y), while arrivals were down from Turkey (-19.2% y/y) due to delays at Sarpi border. Arrivals from EU were up 44.8% y/y to 26,000 visitors. In 4M17 international arrivals increased 11.1% y/y to 1.8mn visitors, while tourist arrivals increased 26.9% y/y to 0.74mn.
Tax revenues up 18.7% y/y in April 2017
Consolidated budget tax revenues were up 18.7% y/y to GEL 755.6mn in April 2017, according to the Treasury Service. In 4M17, tax revenues stood at GEL 3.1bn up 16.6% y/y. The 2017 consolidated budget tax revenues are budgeted at GEL 9.5bn (+8.6% compared to 2016 actual tax revenues)
Inflation was 6.1% y/y and 0.1% m/m in April 2017
The annual CPI inflation was 6.1% in April 2017 after 5.4% inflation in previous month, according to GeoStat. Core inflation was 3.3% in April, up from 2.9% in previous month. Overall price changes were driven by price increases in food and non-alcoholic beverages (+7.6% y/y, +2.31ppts), transport (+17.6% y/y, +2.11ppts), and alcoholic beverages and tobacco (+14.5% y/y, +0.94ppts) categories.
On a monthly basis, prices increased 0.1% in April 2017. Price increase in food and non-alcoholic beverages (+1.4% m/m, +0.42ppts), and price decline in transport (-1.7% m/m, -0.23ppts) categories were the major drivers of monthly deflation dynamics.
NBG increases its policy rate by 25 basis points to 7.0%
At its meeting on 2 May 2017, NBG’s monetary policy committee increased the policy rate by 25 basis points to 7.0% to control the inflation expectations. As NBG cited, due to the supply side pressures, the inflation is expected to be above its target rate during 2017, and all other things being equal, a further increase in the policy rate is not expected. Once the effect of one-time factors affecting CPI inflation is exhausted, the inflation rate is expected to decline to its target level of 3.0% in 2018. The next committee meeting is scheduled for June 14, 2017.
