Russia and the Cis Countries, the start of a recoveryExports on the rise and a dynamic trend among buyers

Mar 20, 2017
Posted in: , Markets
Moscow, Gum
Moscow, Gum

Good news arrives from Russia and the Cis area: the data processed by Istat reveals how, after the plummet taken by sales over the last two-year period, a slow, but sure, period of recovery has begun.

Generally speaking, the entire area registered a +10.4% in sales volume during the first ten months of 2016, with Russia recording a rise by +9.9% in its sales volume, and the Ukraine even registering an incredible double-digit increase of +44.2% in sales. Even if some countries of the Federation – like Kazakhstan, for example, which is limping along at -15.6%, have not yet begun to experience a phase of recovery, it seems that the overall trend has improved.

One of the most important indicators confirming this was also the greater dynamism shown by buyers from this part of the world at the beginning of the season, who increased the turnout at the first international fashion and footwear fairs held at the beginning of the year. An important signal, also for theMICAM, which, now in its 83rd edition, is beginning to close the gap with the record numbers of 2013, when a record quantity and value in footwear exports was registered at 10.5 million pairs, for a value of 815 million euro.

Astana, Khan Shatyr
Astana, Khan Shatyr

For Russia, the recovery registered during the first ten months of 2016 is still partial, with values half of what they were before the crisis, also in consideration of the significant drop in the average price (-14%): an indicator of how the market has been transformed, with pressure arriving in the guise of a demand for lower prices and a preference for a less elevated product range. We are currently in a phase of recovery, but the road to reconquering lost Russian market shares is still long and hard. Just consider that between 2013 and 2015, we sold -44.1% fewer pairs, with a downturn in sales equal to -47.9%… Moreover, the EU’s decision to renew sanctions against Russia for another six months will not help provide momentum to the recovery: notwithstanding the fact that the measure does not directly affect footwear, it nevertheless aggravates theuncertaintysurroundingthismarketand the crisis-generated recession, with uncertain consequences also for Made in Italy. Vice versa, the elimination of sanctions could help accelerate the current phase of recovery.

il-centro-commerciale-skymall-di-kiev
Kiev, Skymall

As far as the rest of the CIS area is concerned, the recovery of the Ukraine is more pronoun- ced with respect to Russia: besides the above-mentioned +44.2% in quantity, values are on the rise by +28.7% but, also with this market, the 10% drop in the average price per pair must be considered. At the same time, it is true that in the Ukraine the road to recovery is even longer than the one Russia must travel down, considering that between 2013-2015 there was a fall-off by -60.4% in quantity and -58.7% in value. Moreover, the recovery is also dependent on overcoming, once and for all, the political tensions with Russia.

With regards to other CIS countries, besides Kazakhstan, which was already mentioned, during the first ten months of 2016, a negative downturn also characterized Azerbaijan (-8.8% in quantity), Armenia (-8.4%), and Kirghizstan (-14.9%), while Belarus registered a record recovery equal to +65.5% in quantity, followed by Moldavia (+29.2%). At the same time, there was more moderate growth for Georgia (+2.6%) and Uzbekistan (+2.3%), with an almost unvaried and stable result for Turkmenistan (+0.2%).

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