Russian Spending In Britain Slumps 17% In Feb

Tyler Durden's picture

February 2013 saw Russian visitors spend 16% more than in 2012 as "investor" visas flowed, property soared, and hot money slooshed into the UK recovery. However, as AFP reports, Russian spending in British shops fell by 17 percent last month compared to February 2013 as the "unstable situation in Russia has shown its effect on tourism spend this year," already. Shoppers from the Middle East (up 31%) and China (up 23%) continue to represent the highest proportion of international sales in Britain, but it is clear, as The Economist points out, Russian wealth has permeated the upper reaches of society in Britain more completely than in any other Western country, with the health of "Londongrad" now at stake if sanctions are extended.


Via AFP,

Russian spending in British shops fell by 17 percent last month compared to February 2013, according to tax-free shopping statistics out Monday.


Visitors from Russia spent an average £669 ($1,103, 800 euros) per transaction, according to Global Blue, seeing them overtaken in third place by those from Nigeria compared to 12 months ago.


Spending by Russian visitors was up 16 percent for the year in 2013 but fell in February 2014.


"The unstable situation in Russia has shown its effect on tourism spend this year as the weakening economy leaves shoppers disinclined to travel," said Gordon Clark, Global Blue's UK country manager.




Shoppers from the Middle East (up 31 percent) and China (up 23 percent) continue to represent the highest proportion of international sales in Britain.

The problem of sanctioning Russia is a big one for the UK...(via The Economist)

Britain grants three-year “investor” visas to foreigners who invest £1m or more in government bonds. Two years later they can buy residency for £10m as long as they have held on to the bonds. Russians were granted 433 of these visas between the third quarters of 2008 and 2013, more than any other nationality. Only the Chinese came close, with 419.



Oligarchs are keen buyers of London mansions and penthouses. According to Savills, an estate agency, 4% of buyers in “prime central” areas, such as Chelsea and Westminster, are Russians, spending £6.3m on average. Interestingly, another estate agent says that he recently got a “peculiar” call from a Russian client eager to sell two large properties immediately, which might possibly be connected to the crisis.




The number of properties registered to Russians understates the true total by failing to capture offshore structures fronted by nominees, of which Russians are particularly fond. Britain’s offshore satellites, in particular the British Virgin Islands, known for their secretive shell companies, do well out of this. A leading BVI lawyer says that Russian clients make up 15-20% of his business. Only the Chinese are as active. The lawyer notes that business from Russians is up slightly in recent weeks.


London is the main foreign capital-raising venue for Russian firms, many of which crave a listing there to gain international financial respectability. Some 28 Russian firms, with a market value of £260 billion, are listed on London’s main exchange (compared with just two in New York). Another 15 Russian-focused firms are on the AIM market for growth stocks. Dozens more have depositary receipts (special overseas shares) that are traded in London. Some $46 billion of Russian stock has been sold in London IPOs since 1996, according to Dealogic.


The fate of offerings in the pipeline—including a bank and two retailers—is now uncertain, more because of market conditions than from a fear that listings might be blocked. Underwriters sneaked in an offering by Lenta, a supermarket chain, days before the crisis erupted. Its share price subsequently tumbled by 15%.

So, just like Germany's Russian envoy is playing down sanctions as a downward spiral, we suspect the UK will be quick to push back on any pressure from the US to want further economic constraints on Putin.

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Kirk2NCC1701's picture

But they all love Mother Russia, right?  Like all Oli's love their native country.  /sarc

nod2glod's picture

Actually this might be due to the winter olypics with Russians spending more locally.

666's picture

Hah! That'll teach them evil Russkies. Economic sanctions will sure hurt them, not us.

Oh, wait...

HurricaneSeason's picture

It'd be interesting to see how many congressmen own foreign property for when the dollar collapses or foreign company stock for the same reason.  I think a lot of "American" companies keep their profits and properties overseas to avoid tax and to keep their profits in foreign currency, so it might be difficult to determine what is  "foreign company" stock.  I've read that Bush owns a ranch in Paraguay and Clinton owns one in the Dominican Republic.

Max Damage's picture

When does Chelski get annexed by the Glaziers?

philipat's picture

When Moyes finally gets a Midfield and central defence in place?

Max Damage's picture

Just annex them off Chelski then. Get Obummer and his G-7 bum chums to sanction it. Job done ;)

yogibear's picture

Russia, China and the rest of BRICs need to kill the petro dollar and swipe the reserve currency status.

philipat's picture

Patience, patience!! Step 1 will be when Putin visits Bejing in May and signs a new Gas export deal denominated in Yuan and/or Rubles. Step 2 is when Putin announces they will accept Gold or any currency OTHER THAN Dollars for gas exports to Europe. Step 3 is when the Saudi's join the game, in recognition of the fact that China is now the number 1 importer.

_ConanTheLibertarian_'s picture

Yes, this May could be pivotal.

fredquimby's picture

Step 4. Alaska does a Ukraine.

RadioactiveRant's picture

So China with its $12tn in corporate debt, Brazil is suffering increasing street violence and has just had its S&P credit rating cut to BBB-, and Russia will lose its European exports over the next 10 years are in a position to take over the USD?

The USD is being badly managed and will go the way of all debased currencies but right now theres no heir apparant.

Dubaibanker's picture

#deglobalization at work.....more and more countries withdrawing from elsewhere...for various, political, self growth, self survival....this will hasten the continued slowdown of the global economy......Libya, Kuwait and Saudi are banning foreign workers....Canada and Singapore are reducing foreign workers as well as immigrants...Malaysia and Indonesia are reducing export of ores........Western banks are shrinking from Russia has joined the fray....

philipat's picture

So that means that Saudis will actually have to work??

Stoploss's picture

Couldn't happen to a nicer bunch of fuckheads..

Racer's picture

So if you are rich enough you can buy your way into the UK

Yet another case of:

'Some animals are more equal than others'

philipat's picture

What do you think has been propping up US Real Estate? The NAR has a waiver from all money-laundering charges for US RE purchases.

BlindMonkey's picture

I am not sure why though. You can apparently get there just by being a muzzie jihadist.

philipat's picture

Nah, we have GCHQ and NSA protecting us now??

q99x2's picture

Reformed Globalists.

Calculus99's picture

The thing is that London has no competition from other European cities so just where are the wealthy Russians/Chinese/Arabs going to go? Paris (perhaps for some Arabs), Amsterdam, Berlin, Geneva, Nice etc, no way, different languages and basially no other Russians/Chinese/Arabs etc. Sout of France for the summer but that's about it.

Miami, New York and LA are alternatives but not as close as London. Plus, why escape one Police state to another? London also LOVES money, clean, dirty or very dirty, a £50 note is still £50 regardless of where it came from or if it has blood stains.

When these idiot politicians are finished and nothing happens re Crimea expect the spending to continue until the asset boom collapses.  

dogismycopilot's picture

The Russians are too stupid and too self absorbed to stop spending money in London.

Just like the Russian Jewish emigres in Paris in WWII thought they would be safe there.

The NWO will one day own those flats, mansions and Bentleys.

Sure as the sun rises and sets.

tony wilson's picture

this will not stand

this is an outrage

the russian must spend

he must be forced to spend

buy hook or crook he will spend.

shop you scum

shop buy and shop.

the whore of the citi of rothschild london needs your bail ins

falak pema's picture

When the fight between Oligarchies makes the City tremble : 

Les oligarques russes menacés, la City tremble

SAT 800's picture

Perfect. I love it. The historic enemy of Russia; "Great Britain"; is now a pendant on their watch fob. Onward with Scottish Independence ! Fuck the English !