6-9 months before economic improvement as retailers brace for impact of downturn
A top government official's warned it could take 9 months before Russia's economy turns the corner. Banks and builders are already in crisis-driven consolidation. The head of the country's largest restaurant chain says retail is now slowing down as well.
In her first speech as Britain's new Ambassador to Russia Anne Pringle said the “serious differences” between the two nations risked blocking the fight against the credit crunch. But at the Russo-British Business Forum, President Medvedev's aide, Arkady Dvokovich, warned Russia's economy would get worse, before it gets better.
“Difficulties can last for at least six to nine months, and then the situation will start improving.”
Now bank cuts have hit the public the next sector in trouble's retail. According to Rostislav Ordovsky-Tanaevsky Blanco, President of Rostik Group, Rosinter's bracing itself for a 10% fall in customers, though that's not on the scale of 1998.
“We will be also limitly affected. but this time we're not at the centre of the crisis. In 1998, at this time, already one month after the crisis we had a 50% drop in sales.”
Top retailers are already in the mire. Russia's largest grocery chain X5's freezing projects to 2011, selling its construction arm, and sacking 30% of managers.
X5 to slash office staff by 30% and freeze new store openings in 2010-2011
Rosinter Restaurants sees Net profit slide to $1.3 million in 1H 2008
