Q1 2013 Russia Tourism Market Report

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RNR MARKET RESEARCH PRESENTS
Russia Tourism Report Q1 2013
http//www.rnrmarketresearch.com/russia-tourism-re
port-q1-2013-market-report.html
The Russia Tourism Report examines the long-term
prospects for the tourism sector but, in the
short term,considers the negative consequences of
an economic slowdown in key source markets. We
believe thestrong pick-up in visitor growth in
2011 slowed only slightly in 2012, with
continuing favourable growthfrom some key source
markets in the eurozone, as well as Poland and
China. An acceleration in arrivalsgrowth is
anticipated from 2013.
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The report analyses official data on the number
of foreign visitors to Russia, which showed
sharpnegative growth in 2009 (after years of low
growth) but relative buoyancy in 2011. BMI also
considersfigures on the departure of Russian
citizens abroad, which, aside from 2009's
negative growth, havewitnessed continual healthy
growth rates in recent years.Factors
constraining potential tourism to Russia also
feature heavily, including the threat of
terrorism andconcerns about Russian flight safety
standards. Business opportunities, though,
clearly exist in the midmarketaccommodation
sector, infrastructure development and low-cost
airlines.Solid growth in foreign arrivals
continued in the first half of 2012, with latest
provisional national datashowing an increase of
just under 15 year-on-year (y-o-y). This is
similar to the growth rate recorded inH111 and is
surprisingly strong given weak demand conditions
in the eurozone - a major source regionfor
inbound visitors. Indeed, growth in arrivals from
key markets such as Finland, Germany, France
andItaly, was relatively strong in H112. Outside
the eurozone (excluding the former Soviet.
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Over the last quarter BMI have revised the
following forecasts and viewsBMI forecasts a
slight slowdown in foreign visitor arrivals to
Russia in 2012, with annualgrowth of 9.5 (edged
up from our previous forecast of around 6). A
moderate pick-up ingrowth is anticipated in 2013
and 2014.BMI's real GDP growth forecasts for
the eurozone, a major source of inbound tourism
to Russia,have been lowered marginally for 2012
to -0.7 from -0.6, rising to only 0.6 growth
(downfrom 0.9 previously) in 2013 but picking up
to 1.4 in the following year.BMI expects the
Russian rouble to head towards our end-2012
RUB33.00/US target, fromaround RUB31.50/US at
the time of writing. Moreover, since we expect
appreciatory pressuresto stay subdued beyond
2012, our end-2013 forecast is also RUB33.00/US.
The short-termcurrency effect is therefore
favourable for inbound tourism.Reflecting
favourable growth in visitor numbers, two main
players in the domestic market,Aeroflot and
Transaero, recorded impressive growth y-o-y in
passenger traffic in the first threequarters of
2012.
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