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EU sanctions against Russia backfire on tourist industry, retailers

October 20, 2014, 16:17 UTC+3 Zamyatina Tamara
© ITAR-TASS/Artyom Geodakyan

MOSCOW, October 20. /TASS/. Anti-Russian sanctions have backfired on the Old World’s tourist industry. Far fewer Russians go to Europe on holiday these days. On some destinations, tourist flow has slumped between 20% and 50% against 2013. Experts see two reasons for this: reluctance to put up with outbreaks of Russophobic sentiment and the ruble’s slump against the euro.

Europeans are ringing the alarm. Dwindling tourist flows from Russia is a heavy blow to Western economies because Russians have firmly held the leading place in the EU’s tourist industry for the past few years.

In 2014, anti-Russian sanctions by the EU prompted Russian holiday-makers to set their eyes on Turkey and Egypt while Europe suffered a “catastrophic setback,” says spokeswoman for the Russian Tourist Industry Union Irina Tyurina. In a bid to lure back Russian vacationers, European tour operators have had to resort to unprecedented dumping offers.

According to the European Tour Operators Association (ETOA), Britain’s tour industry will lose about £50 million (about $50 million) in 2014. Finland, which last year was in the top 10 countries most popular with Russian tourists, this year has slumped to the 13th place.

European tour companies are not the only ones who have been calculating missed profits. The same applies to retailers in EU countries, where travelling Russians have by tradition been one of the most active buyers. For instance, in Spain, according to the Russian union, Russians left more cash than guests from any other country. Of late, Britain used to welcome more than 220,000 tourists from Russia. Each foreign guest leaves in London £600 during one trip on average. Russians spend more than £1,000. In Germany, Russian tourists held second place by the amount of cash spent on shopping.

The spending of Russian tourists abroad in the first half of 2014 grew by a tiny 4% against 25% in the same period last year, say statistics from the United Nations World Tourism Organization (UNWTO). In 2013, Russians spent a total of $53 billion outside their home country (5th place in the world rankings), the UNWTO says.

Education tourism has proved most vulnerable to the negative influences of the sanctions policy. Many parents have decided not to hurry to send their children to summer language courses in other countries. The reason is the same: the fear that young Russians may face unfriendly treatment. Of the Western countries, language courses in the United States, Britain, Canada and Australia have sustained the biggest losses.

“People are eyeing Europe with suspicion because it remains unclear what restrictions Russian travellers may face there. Besides, organized tourism from Russia to Europe is falling for purely internal reasons: last summer’s string of tourist firm bankruptcies undermined the industry’s credibility,” tourist industry specialist Galina Dekhtyar, a senior lecturer at the Russian Presidential Academy of National Economy and Public Administration (RENAPA), told TASS.

“For the tourist flow from Russia to Europe to restore, there has to be a general improvement of the political situation — first and foremost, cancellation of anti-Russian sanctions. And the Russian authorities are to take measures to stabilize the exchange rate of the ruble,” Dekhtyar said.

“It goes without saying that the dwindling number of Russians’ trips to Europe amid adverse international conditions hits the EU economies first and foremost. By virtue of national, cultural traits a Russian who has just €300 in the wallet will not hesitate to spend it to the last cent. Now the money will stay in Russia. Many Russian travellers have seen enough of the West. These days there is soaring demand for domestic tourism, Crimea being one of the popular resorts, which meets the interests of Russia,” the director of the Globalization Problems Institute, Mikhail Delyagin, told TASS.

ITAR-TASS may not share the opinions of its contributors