Latest developments in the tourism sector in Russia

Sanctions by Western countries imposed towards Russia in 2022 impacting the major business sectors were further increased and carried on. It resulted in higher prices and longer delivery times. At government level the state is finding ways of improving situation and alleviate their impact. After more than five hundred days of limitations we understand how to proceed, bigger par stocks, closer communication with suppliers and certainly earlier ordering in particular for spare parts (this area is the most problematic).

Previously foreign owned companies have shifted to local ownership with some success, Russia is said to resuscitate their long-neglected industry. The confirmed arrival of new countries to BRICS (UAE, Egypt, Iran, KSA, Argentina) would have a positive impact on the Russian trade (raw materials, oil, gas). With possible reduction of reliance on the US dollar as a reserve currency will be expected in favour of currencies currently established within BRICS.

Sanctions implemented have significantly affected the bank sector of Russia. Foreign credit cards remain banned within Russia, which ultimately provoke tremendous pressure for any foreign guests willing to visit Russia.

After record inflation growth was observed in Russia in March 2022 (due to unprecedented sanctions towards Russia, Ruble exchange rate collapse and highest level of demand for convenience goods), it stabilized at 7.4% in 2023 and planned at 7.6% for 2024. GDP 2024 shows growth up to 3.5-4% (Central Bank of Russia)

Consumer confidence indicator in Russia, reflecting the aggregate consumer expectations of the population continues to show stable growth and reaches 6% in Q2 2024, which is maximum since 2014 (by Federal State Statistics Service)

Unemployment rate is set to remain at a record low of 3.0% in 2025 VS 3.2% in 2024 (source by macro economical research of Bank of Russia).

On a positive note, governmental support towards the hospitality sector was introduced in July 2022 with five years validity at zero VAT rate implementation for accommodation services, which naturally continues to support hotel ADR. E-visa was implemented in August 2023 which ultimately aim to attract travellers from 52 countries (Europe, Korea, Mexico, Oman, KSA, Singapore, Turkey, China, Iran, Japan, India) by low cost (50 EUR) and short issue period up to five days with validity thirty days. In addition, free visa regime for groups started for China and Iran, which supports leisure and business travel.