The impact beyond the local market: goodbye to tourists
The impact of the Russia-Ukraine war will not, however, be limited only to the local market. First of all, there will be a decline in sales in those countries that count (or hoped to count again, with the end of the pandemic) on purchases of Russian tourists: “Even Russian spending abroad, mainly directed towards Western Europe, will be drastically reduced as long as the closure of European airspace to Russian civilian airlines is in effect”, continues D’Arpizio.
Italy is undoubtedly among the countries hoping for a return of Russian tourists: before Covid they were the second nationality for tax free purchases after the Chinese (who, we recall, are still “blocked” at home by travel ban). According to the findings of Global Blue, a leading company in the tax free shopping segment, in the period January 2021 – February 2022 the volume of tax free purchases by Russians (many of whom vaccinated with serums not recognized by Ema and therefore limited in travel) in Italy decreased compared to 2019, but the average receipt has risen to 1,215 euros (+ 78% compared to 2019) which in the case of purchases in Venice has even risen to 2,060 euros. If the favorite city for shopping was Milan (39% of tax free purchases), the favorite category is that of fashion & clothing (87%).
The long-term effects on Europe and the US
And if the conflict were to continue, the effects on Europe could be more serious: «We foresee a potential impact on Europe and the United States, should the current crisis intensify (and / or persist over time) leading to more serious economic and financial consequences – explains Federica Levato, Partner Bain & Company and Leader EmeaFashion – Luxury Practice -. However, this scenario is currently unlikely and correlated with the methods and timing for resolving the crisis, which is extremely difficult to predict today “. Among these consequences are a lower GDP growth of EU countries, due to increases in energy prices, which could impact the confidence of local luxury consumers, with a consequent reduction in discretionary spending by European consumers. Already tested by the two-year period of Covid-19. The negative effects on financial stabolity, on the other hand, could undermine the confidence of US consumers, which is highly linked to stock market fluctuations.
To underline the potential and serious side effects of the conflict (this time for the Italian fashion textiles as a whole) was Carlo Capasa: «The Russian market in normal times represents about 2% of exports for Italian fashion. Obviously, the repercussions of this war will entail effects that will go beyond the blockade of the Russian market and the loss of the Ukrainian one, if only for the impact that the energy cost will have on our production, but what interests us at the moment is end this war and safeguard the life and freedom of people, ”the president of Cnmi told beraking latest news.
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