Russia’s fast-growing economy is fueled by oil, gas and other commodities. In 2009, it was the world’s largest exporter of natural gas, the second-largest exporter of oil and the third-largest exporter of steel and primary aluminum. Russia’s economy is expanding at roughly 4 percent a year.
Business travel industry insight
Traditionally, bureaucracy, tax and foreign exchange rules have made Russia a difficult market in which to do business. But the financial crisis of 2008 prompted some improvements. For example, billing and settlement plans are now a reality, as are lodge cards in local currency. But cash flow remains critical.
- Russia is one of the world’s fastest-growing markets, so business travel demand is high.
- Productivity can be greatly enhanced by technology.
- Russia is a regional influencer; gains made there can translate to success in neighboring countries.
- The oil and gas industries that lead the economy, while volatile, have weathered the economic downturn better than many industries.
- Travel programs must contend with multiple booking systems: one for rail, one for hotels and two for airlines.
- Contracts must be in Russian if payments take place in Russia, and payment must be done in rubles.
- Online booking is just beginning to take hold and is hampered by a low penetration of credit cards.
- Established relationships can carry more weight than competitive factors, such as price and service.
- Corruption is prevalent, even in the travel industry (Transparency International score of 2.4 out of 10).