The economic crisis in Russia is expected to reduce the number of Russian tourists arriving in Finland at the turn of the year. There will be no shopping rush like the ones we have had in previous years. Finland also has to compete for the declining number of tourists with Estonia.

Last January, the number of Russian tourists arriving in Finland increased by about four per cent from the previous year. However, the collapse of the rouble has made a shopping trip to Finland a less attractive notion. The Finnish Commerce Federation estimates that the number of Russian New Year tourists may be 20% lower than the previous year.

Russians who visit Finland in January spend considerably more money on their shopping than tourists on average, so the loss of New Year tourists has a negative impact on business. The total value of tax-free shopping in January is usually some 70% higher than the monthly average. Furthermore, the Russian New Year tourists stay in the country longer than at other times, so the decline impacts the entire tourist business.

Decline of Russian tourism in Finland affects seasonal sales

Traditionally, businesses launch their seasonal sales campaigns right after Christmas. However, the decline in the numbers of Russian tourists has impacted the season sales campaigns as well. Businesses, in particular those near the eastern border, have launched their traditional season sales campaigns earlier than usual.

In some places, the discount campaigns for clothing and sports gear started as early as before Christmas, because of the warm December.

Estonia attracts tourists from Saint Petersburg

A weak rouble is not the only thing worrying Finnish businesses benefiting from tourism. Finland must also compete with Estonia over Russian tourists, especially those arriving from Saint Petersburg.

According to border interviews* carried out by the Finnish Commerce Federation last autumn, Russian tourists from Saint Petersburg make more trips to Estonia than to Finland. In addition, they stay longer in Estonia than in Finland.

In Finland, over 70% of the tourists from Saint Petersburg are on a day trip. The corresponding figure for Estonia is 40%. Nearly as many stay in Estonia for 2–3 days, whereas the number of those spending multiple days in Finland is considerably lower.

Furthermore, the shopping list of the tourists from Saint Petersburg is more varied in Estonia. They buy food, sweets, alcohol, clothes for adults and children as well as footwear. In Finland, they buy mainly food. Tourists from Saint Petersburg also use more services in Estonia than in Finland.

‘Price competition between Finland and Estonia is clearly visible in the results. It tells us that we must take care of the competitiveness of Finnish businesses. Under this Government, businesses have been burdened by ever tightening taxation and increasing administrative costs,’ says Juhani Pekkala, Managing Director, Finnish Commerce Federation.

* Tutkimus- ja Analysointikeskus TAK Oy interviewed 7,130 Russians aged at least 15 leaving Finland in January–August and 1,000 Russians aged at least 15 leaving Narva, Estonia, in August–September.

The Finnish Commerce Federation represents commerce – the largest sector of economic life. Commerce employs around 300,000 persons in Finland. The Federation has around 7,000 member companies and represents both retail and wholesale commerce in industry policy and labour market lobbying. www.kauppa.fi