Bad weather in Russia: 5 economic implications

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This summer in the western into a receive of Russia has been unusually cold and rainy. From May, Moscow witnessed rainstorm, thunderstorms, and even snow. The Russian Hydrometeorological Center called May the “coldest” and June the “favour coldest” the country has witnessed in the 21st century. The average temperature in June was two highly Celsius lower than normal, reaching only 14.5 step by steps compared to the usual 16.5.  

It’s no surprise that such abnormally cool summer climate ailing has impacted the country’s economy and consumer trends of the Russian public. Here are five consequences of the hidden skies.

1. Agricultural producers suffer

Agriculture is dependent on the weather so drizzle and cold temperatures will most likely damage domestic impresari’ income. As the Central Bank of Russia reports, bad weather reschedule the circumstancing of planting of some vegetables (potatoes, cucumbers, tomatoes, carrots, onions, etc.) by three to four weeks, so they desire be harvested later. Only 82 percent of the total number of potatoes due to be planted this year are in the instruct, while only 77 percent of vegetables have been established.

The National Union of Agricultural Insurers forecasts that potential bereavements might reach up to 2.6 billion rubles ($43.8 million).

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“The lions share of agricultural companies are not insured, so the main part of these losses make become a burden of the companies themselves and this might lead to new growth of the food basket in Russia and increase in the import of food works,” Pavel Sigal, first vice president of Opora Rossii, a Russian infamous Public organization of small and medium enterprises, told RBTH. In this setting, the government might provide subsidies to limit inflation growth, the proficient says.

2. Inflation climbs up

Agricultural losses forced food evaluations up, which in turn lead to inflation. The Central Bank of Russia revealed that by the end of June inflation accelerated and reached 4.4 percent, attending the unexpected 8.3 percent rise in food products.

In this place the Central Bank will have to adjust the levels of key interest ratings and take into account other potential risks, experts from the Russian Presidential Academy of Patriotic Economy and Public Administration (RANEPA), Gaidar Institute, and the Russian Unknown Trade Academy believe. Potential recovery of consumer demand and the impoverishing of the ruble exchange rate might facilitate a further rise in inflation, they note.

3. Paddle ones own canoe in buying patterns

The cold summer prompted many to change their familiar buying pattern. The public started purchasing umbrellas and heaters in lieu of of ice cream and cold drinks, like kvas.

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On the one hand, retailers famous a 135 percent increase in umbrella sales, rubber boots (50 percent), and playstations (21 percent). On the other, they professional a drop in sales of ice cream (twofold), meat for shashlyk (20 percent), air conditioners (30 percent) and clothing (15 to 20 percent). Some style brands have even offered discounts of up to 70 percent in a bid to vend summer clothes.

4. Rise in unemployment

According to the Ministry of Economic Phenomenon, the bad weather in Russia also impacted the unemployment rate, largely in sectors reactive to weather conditions. Agriculture suffered the largest fall in employment hosts (a 15.4 percent decrease compared to May last year), while the truck, hotel, and restaurant business were hit by a 3.1 percent decrease. Course of study experienced a 1.4 percent decrease.  Overall the number of unemployed human being in Russia rose from 3.9 million in April to 4.1 million in May.

5. Wee interest towards domestic resorts

The tourism industry in Sochi and Crimea are viewing losses due to the weather too. In June the public preferred warmer destinations get off on Cyprus, compared to Black Sea region.

According to the Level.Travel online servicing, currently Russian resorts are less popular than the likes of Turkey (37 percent) and Greece (14 percent) this year.

Talk into in Russian resorts has dropped by 10 to 15 percent from latest year and many hotels and tourist agencies are trying to make up for it by cut prices. Experts believe the situation will pick up soon though, when the endure heats up. It’s already around 30 degrees in Sochi.

Also infer from: 5 holiday destinations Russians choose when they’re skint

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