Russia sanctions itself further

Not content with denying themselves the pleasures of French cheese and Norwegian salmon at prevailing (i.e. non-smuggled) market rates, the Russian government has now decided its citizenry doesn’t want to go on holiday to Turkey:

“Some things are more important than beaches, the sea and all-inclusive holidays,” anchorman Dmitry Kiselyov boomed in his influential weekly news round-up on state television.”

Such as the egos of politicians.

It’s the second popular destination to be banned in under a month. Flights to Egypt were halted in early November, following a terror attack on a plane full of Russian tourists.

When Egypt’s beaches became inaccessible, many Russians were re-directed to the Turkish coast.

And with the collapse of the rouble making Asia beyond the reach of most Russians, the number of holiday destinations from which they can pick is dwindling rapidly.

Still, people here seem broadly resigned to what has happened – even supportive.

“I think it’s the right response. Turkey has shown it’s a traitor,” said Andrei, taking a cigarette break from work, out in the snow.

Was Andrei planning on going to Turkey, then?  If not, his words are somewhat cheap.

Scheduled flights to Turkey are still running and the embassy stresses that Russian tourists are welcome. A spokesman said there were no plans to introduce visa requirements for Russians, despite Moscow doing that for Turks.

That’s because the Turks understood what Joan Robinson meant when she said “if your trading partner throws rocks into his harbor, that is no reason to throw rocks into your own”.

But any travel agencies caught selling Turkish tours have been warned they face sanctions.

Russia’s Federal Tourism Agency argues the ban will have a “hugely positive” impact on domestic tourism.

Well, yes.  The foreign travel policies of the USSR were also a great boon for domestic tourism too.  Just not from the point of view of the tourist.

Its head sees Russians opting for “staycations”, injecting their holiday funds into the local economy instead.

Opting to stay at home in the face of a ban on doing otherwise?  Some option.

They point to a lack of hotel capacity in Russia and poor infrastructure: “Patriotic” resort choices don’t generally offer the quality those who holiday abroad have grown used to.

No shit.

So travel agencies are offering them European destinations like Spain and Greece as alternatives – as well as Thailand and Vietnam.

Good luck with that Schengen visa process, folks!  Or the 13-hour flight plus a Thai baht which has doubled in value against the rouble in the past 2 years.

The business sanctions could hit Turkey much harder, albeit again at considerable expense to Russia:

Russia has announced a package of economic sanctions against Turkey over the shooting down of a Russian jet on the Syrian border on Tuesday.

A decree signed by President Vladimir Putin (in Russian) covers imports from Turkey, the work of Turkish companies in Russia and any Turkish nationals working for Russian companies.

A lot of the construction work in Russia – shopping centres, housing complexes, infrastructure – is carried out by Turkish companies, who exploit the fact that they can mobilise a sizeable, cheap workforce of their own countrymen to Russian cities which lack local expertise and manpower.  In short, Turkish companies have filled a gap in the market left open by Russians who either cannot do the work, or cannot do it at a competitive price*.  If these companies and their workers are now going to be booted out of Russia, future building works in that country are going to become very expensive or cancelled altogether.  I wonder how those Russians who have placed deposits on apartments in partially-completed developments being built by Turks feel right now?  Holidays destinations are probably the last thing on their minds.

*This reminds me of a joke, which I heard told by a young Russian man to answer a question some foreigners had put to him as to why it was so hard to do business in his country, and goes as follows.

A Russian city needs a bridge built, and so puts out a call for tender to three construction firms: German, Turkish, and Russian.  The Germans say they will build the bridge in 1 year and it will cost $20m.  The Turks say they will build the bridge in 2 years for $10m.  The Russians say they will build the bridge in 2 years for $50m.  The Head of Public Works in the city stares goggle-eyed at the Russian proposal, and brings in the company president to explain:

“How come your proposal is so high?” he asks.

The president of the Russian construction company smiles and says “$20m for me, $20m for you, and we’ll get the Turks to do it for $10m!”

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6 thoughts on “Russia sanctions itself further

  1. Re: ‘the ban will have a “hugely positive” impact on domestic tourism’

    They were saying the same thing about local business and industry: the international sanctions would have a “hugely positive” impact on Russian industry, there would be a massive stimulus, import replacement, etc. How did that actually work out?

  2. Well, there are (or were) only three places on the northern Mediterranean that Russians could go without a visa: Turkey, Montenegro, and Albania (although only in summer for the last). And on other parts of the Mediterranean, there was Egypt (tour groups only), but also Israel, Lebanon, Tunisia, and Morocco. If you include the Black Sea, there is also Ukraine and Georgia. Altogether an interesting list. Montenegro is a colony of Russian tourists and not much else. Albania has nice beaches but the infrastructure is still quite primitive (but construction is booming, no doubt due to this amongst other things).

    So I guess it is Crimea without electricity. Or Sochi. Or Abkhazia. Should be fun.

    Although given that Russia is rapidly running out of money, does it actually matter?

  3. @ Estragon,

    How did that actually work out?

    I’m not sure, to be honest. My initial guess would be “badly”, but I might do some digging to find out.

  4. @ Michael,

    So I guess it is Crimea without electricity. Or Sochi. Or Abkhazia. Should be fun.

    Yes, the irony in all this is that when Abkhazia was annexed (pretty much, anyway) they were promised lots of development monies. But then Sochi won the Olympics, and all the money was diverted there. One of the attempted justifications for spending so much money on Sochi was that it would become a world-class holiday resort, and I assume locals there were expecting a ramp-up in visitors each year as a result to compensate for their town being turned upside down. But now everyone is being encouraged to go to Crimea instead, leaving not one but three regions relying on funds that have yet to materialise and a bunch of reluctant Russian tourists on which to base their economies.

  5. Whether Putin’s foreign policy is based on a long-term vision or a series of knee jerks, it fits nicely with his domestic agenda: a steady supply of foreign enemies to the electorate while it’s getting poorer. The trick here – the balancing act required of the cabinet – is to keep self-inflicted economic damage from triggering an explosion of unrest. So not all Turkish companies will be banned, and Egypt looks likely to be reopened. However, no one can be sure what will serve as the last straw: the Kremlin did not expect that desperate long-haul truck drivers would start blocking roads.

  6. However, no one can be sure what will serve as the last straw: the Kremlin did not expect that desperate long-haul truck drivers would start blocking roads.

    Ooh, I didn’t hear about that!

    But you are right that in any country unstable enough to have its leader’s portrait plastered all over the place (which is a very good yardstick, in my experience) the catalyst that brings about the revolution is never one that is expected. The Arab spring was triggered in Egypt by the government fiddling with the price of flour (or maybe bread). The Syrian civil war went from protests to armed opposition when the secret police arrested teenagers and tortured them in prison over several days. I remember a few years back the Russian government was taken completely by surprise at the scale of protests and public anger when some poor elderly chap was jailed for “killing” some big-wig who had been driving ridiculously fast in his German car and crashed into him. It will start with something small, the government will overreact, and it will snowball from there.

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