Deaths of Russian tourists leave Abkhazia at risk of losing economic lifeline over security failures

Deaths of Russian tourists leave Abkhazia at risk of losing economic lifeline over security failures
One of Abkhazia's tourist draws is Lake Ritsa in the Caucasus Mountains, where boat cruises are available. / Mitrios.
By bne IntelliNews August 4, 2017

Abkhazia, a Georgian breakaway region that is highly reliant on Russian backing, risks losing vital flows of Russian tourism that support its economy. Two incidents there in the past month have left three Russian tourists dead and dozens injured.

The first, in July, saw an armed gang kidnap two families of Russian tourists and kill one man before later releasing the other hostages. Then, on August 2, an explosion at a government-owned munitions depot, located in the village of Primorskoye near the Black Sea, killed two Russian tourists that were riding horses nearby. Another 64 people were wounded, with 27, including children, hospitalised. Around 30 of the injured were Russian.

In an August 2 statement published on the website of the Abkhaz presidency, incumbent Raul Khajimba expressed his condolences to the families of the victims and promised compensation for their losses. 

The incident took place with Russian President Vladimir Putin by some accounts gearing up to visit the region on August 8. On August 2, US Vice President Mike Pence was in Georgia reiterating his country's support for the small nation and affirming Washington’s recognition of Georgia's territorial integrity, while condemning Russia for occupying the regions of Abkhazia and South Ossetia. 

Abkhazia does not publish regular economic statistics; therefore the contribution of tourism to its economy is uncertain, but the website of the presidency claims that the country is dependent on tourism, the majority of which stems from Russia, for foreign receipts. Abkhazia is said to be one of the most popular destinations for Russian tourists looking for cheap breaks, having seen an 11% y/y increase in arrivals of Russian tourists in 2016 according to Russian statistics agency Rosstat.

Russian tourists can travel to Abkhazia visa-free, and the region has historically been a travel destination for Russian elites, who go there primarily for beach and health tourism. The fact that Abkhazia uses the Russian ruble as its currency has turned the region into a destination of choice for Russian tourists even during times of economic crisis and currency depreciation.  

Like South Ossetia, Abkhazia is a de facto independent region that is internationally recognised as part of Georgia. It is dependent on Russia for military and financial support, with Russian aid estimated to account for two-thirds of the Abkhaz government budget. In total, Russia operates nine military bases in Georgia's breakaway regions.

Related Articles

Armenia gives preliminary consent to purchase of Ameriabank by Bank of Georgia

The Central Bank of Armenia's Board has preliminarily approved the acquisition of a significant stake in Ameriabank CJSC by Bank of Georgia Group PLC (BOGG) and Bank of Georgia JSC, according ... more

TBC Bank reports 2023 profit up 14% y/y to GEL1.14 billion

In 4Q 2023, TBC Bank made a profit of GEL291 million, representing a 30% YoY increase, with a return on equity (ROE) at 25%, according to unaudited preliminary consolidated financial ... more

Over one-third of Georgian pensioners turn to loans

In Georgia, more than a third of pensioners and social benefit recipients, totalling 354,000 individuals, have opted for pension loans, according to a report submitted ... more

Dismiss