Russians no longer spend in the same way as they used to when visiting Finland. According to statistics, tax-free purchases by Russian tourists have recently begun to decrease. Shopping tourism is still, however, the biggest reason for our eastern neighbours to visit Finland, but its importance has clearly decreased.

According to a report by the Finnish Commerce Federation, Russian tourists’ spending in Finland is about to reach its peak. Still in January, the high season for Russian tourists, tax-free purchases by Russians increased by 14% compared to the previous year. However, the increase changed into a decrease in the summer according to the statistics of Global Blue Finland, the company refunding value added tax on tourists’ purchases, with Russian tourists’ purchases decreasing in almost all largest tax-free cities.

In January–September, Russians’ tax-free purchases increased by only 5%, while the growth rate the year before was 26%.

In the Helsinki region, tax-free sales decreased in January–September, and they also grew by only 3% in Lappeenranta. Growth figures similar to the ones seen last year were only reached in Imatra, Rovaniemi, Kouvola and Kuusamo.

"Russian tourists’ spending in Finland is at a turning point. Spending by Russians both in Russia and abroad depends on economic growth, which has clearly slowed down from last year. Next year, however, economic growth is expected to speed up again,” says Jaana Kurjenoja, Chief Economist, the Finnish Commerce Federation.

Global Blue Finland’s tax-free sales statistics are also supported by border interviews with Russian tourists in January–August*. According to the border interviews, shopping tourism is still the biggest reason for Russians to visit Finland, but its importance has clearly decreased from the previous year.
Even though the number of Russian tourists is estimated to continue growing this year, obvious changes in the type of tourists can already be seen as well. The border interviews indicate that the proportion of both day-trippers and those visiting at least once a month have plunged, i.e. the very people who come to Finland specifically for shopping.

“It also seems that the share of those spending the least in Finland is increasing, which would be alarming news to retailers,” Kurjenoja says.

According to the border interviews, Russians bought foodstuffs, sweets and pharmaceuticals more frequently than before, while purchases of clothing and household goods have decreased.

As many as 94% of Russians make purchases in a shop, but only one in two make tax-free purchases. The quality of products is the most important reason for Russians to make shopping trips to Finland. Better assortments and lower prices than in Russia also attract Russians to Finland.

Growth in overnights by Russians has also slowed down

In addition to waning shopping enthusiasm, the number of Russians staying overnight is changing. Even though overnights have still increased, the growth has slowed down: Last year, Russian overnights in paid accommodation services increased at a brisk rate, some 17%, and also in Uusimaa almost 7%, but the growth clearly slowed down during January–July this year. According to Statistics Finland’s Accommodation Statistics, the nationwide growth this year only amounted to 7%. In Uusimaa, the growth has turned into a decline of one percentage point.

The border interviews, on the other hand, indicate that in addition to slower growth in accommodation services, the use of Russians’ favourite service, restaurants, has decreased.

The most important reason why Russians visit Finland is still, however, clean nature. Russians’ will to do things on their holiday trips does not always meet reality, though. Nature tourism, fishing and cruises, for example, interest holidaymakers, but clearly fewer have taken part in them or purchased related services.

“Therefore, service companies still have obvious growth opportunities, especially since currently more than 40% of Russian tourists do not spend any money on services in Finland,” Kurjenoja says.

* Tutkimus- ja Analysointikeskus TAK Oy interviewed 7,282 Russian tourists aged at least 15 at the border in January–August.
 
Further information:
Jaana Kurjenoja, Chief Economist, Finnish Commerce Federation, jaana.kurjenoja(at)kauppa.fi, tel: +358 (0)9 1728 5134, +358 (0)40 820 5378

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 politics and labour market lobbying. www.kauppa.fi