In Q3 2017, the volume of remittances in Georgia grew by one fifth compared to last year’s level (+19.7%), reaching 367 million USD. The recovery of remittances is a clear sign that the economy of the region continues to improve. All primary source countries of money inflows to Georgia showed a positive annual change: Russia (+13.3% YoY), the United States (+9.1% YoY), Italy (+23.8% YoY), Greece (+9.5% YoY), and Israel (+102.2% YoY).

The growth of money inflows from Russia reflected the dynamics of oil prices on the world market, which positively affected economic growth and therefore the ruble exchange rate against the US dollar. Remittances from Israel have continued to show unprecedented growth, which stems from the wave of Georgian emigration that started in 2014, when the countries ratified a visa-free regime. Following this, many Georgians stayed in Israel illegally or sought asylum there after finding it to be an outstanding country in which to work and send money back to their homeland. Taken together, these two countries contributed 11.2 percentage points to the total YoY growth of remittance transfers in Q3 2017.

According to data from Geostat’s Integrated Households Survey 2016, remittances from abroad constituted 3.2% of total monthly average income in Georgia; however, for recipient families this share accounted for 42%. The biggest portion of remittances likely go into consumption, which has a positive influence on internal demand.

While money inflows have not yet recovered to 2014 levels, the lari depreciation and moderate levels of inflation have boosted the purchasing power of remittances. In Q3 2017, Georgian receivers of remittances got 17.8% more of CPI-adjusted GEL than they did in the same period last year, and 13.6% more than in Q3 2014.