Russia on the horizon: Copying the Kremlin’s tactics increasingly puts Tbilisi in Moscow’s orbit

Following their so-called “policy of national interests,” the Georgian authorities never miss an opportunity to praise themselves for the country’s steady economic growth. In 2022, Georgia’s GDP grew by 10.1%, in 2023 by 7.8%, and in 2024 by 9.4%.

“It is highly likely that certain financial flows currently settling in Georgia are not solely the result of the country’s GDP,” Kipiani said cautiously, “but also stem from the routes used by certain circles outside Georgia — routes that pass through Georgian territory.”

According to a study by the Georgian branch of the International Chamber of Commerce (ICC), in 2022 Georgia’s economic dependence on Russia reached 19%, meaning that Russia had nearly caught up with the EU, which accounted for 21% of Georgia’s foreign economic activity that year. Researchers calculated that in 2022, Georgia was even more dependent on Russia than it had been at the end of Eduard Shevardnadze’s rule in 2003.

However, Georgia’s indirect profits from the war have gradually begun to decline. By 2023, Georgia’s dependence on Russia had shrunk to 16%, and to 12% in 2024, even if Russia remained the country’s largest individual economic partner, second overall only to the EU. This trend was driven by a decrease in the amount of Russian money making its way into the Georgian economy. In 2022, Russians (many of them fleeing the war) transferred more than $2 billion to Georgia; in 2023 — around $1.5 billion; but in 2024 — “only” $517 million. The influx of rubles during the first year of the war had even caused a record strengthening of the lari, Georgia’s national currency.

Revenue from Russian tourism also fluctuated noticeably over the three years. In 2022, it amounted to $890 million; in 2023, the figure was $1.16 billion; and in 2024, it fell again to $854 million.

In addition, Georgia benefited from the surge in transit traffic through its territory. In 2023, Russia’s Federal Customs Service described the Upper Lars crossing as a “breakthrough of the economic blockade imposed by European countries.” The number of transit trucks passing through Georgia increased by over 50% in 2022 compared to 2021 (from 322,000 to 496,000 vehicles). In the following years, growth plateaued, with the total coming in at around 514,000 in both 2023 and 2024.

In 2022, the number of ship calls at Georgian ports also increased by 20%, though in the following years it returned to pre-war levels.

Of course, not all of Georgia’s revenues from trade with Russia are easily traceable in official statistics. In the first half of 2023, for instance, 3,786 vehicles worth more than $53 million were exported from Georgia to Russia. However, after the EU introduced its 11th sanctions package in June 2023, the situation changed sharply. In August 2023, only 85 cars were re-exported to Russia (compared to 1,020 in July). This did not mean Georgia stopped re-exporting cars to Russia altogether — rather, as direct re-exports to Russia fell, shipments to Customs Union countries such as Armenia, Kyrgyzstan, and Kazakhstan surged.