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Russia Retail Report Q2 2009Published by: Business Monitor International Published: May. 21, 2009 - 58 Pages Table of Contents
AbstractThe new BMI Russia Retail report predicts that the country’s total retail sales will more than double in local currency terms by 2013, growing from RUB10.87trn (US$425.0bn) in 2007 to RUB22.58trn by 2013. Rising disposable incomes, an expanding middle class and rising levels of credit penetration are key factors behind retail market expansion. Accelerating foreign direct investment (FDI) has allowed retailers to make significant inroads into the market, contributing to forecast annual retail sales growth of more than 13% in dollar terms.Russia’s nominal Gross Domestic Product (GDP) was US$1295.1bn in 2007. Average annual GDP growth of 4.1% is predicted by BMI to 2013. Although the population is forecast to decrease, from 142.5mn in 2007 to an estimated 138.3mn by 2013, GDP per capita is predicted to rise by nearly 72% by the end of the forecast period, reaching US$15,624. Our assumption of consumer spending per capita is for an increase from US$4,484 in 2007 to US$5,980 by 2013. The country’s large population - and in particular the affluent urban population of the capital - Moscow, is providing a solid base for the expansion of the retail market. Russia has around 14 cities with more than 1mn people, and consumers are increasingly looking to modern retail outlets for aspirational purchases. From January to April 2007, according to the Russian Federal Statistics Service Rosstat, real disposable cash incomes increased 11.5% compared with the same period the year before; while, during April 2007, incomes rose almost 9.2% against April 2006. Retail sectors that are likely to see substantial growth over the forecast period include clothing and footwear (excluding fabrics and sewn articles). BMI estimates that the sector, worth US$30.6bn in 2007, according to Rosstat, will grow in value to US$51.3mn by the end of the forecast period (based on an unchanged market share). We forecast that the flourishing home décor sector, worth US$8.9bn in 2007, according to Rosstat, will increase in value to US$15.0bn by 2013. The availability of consumer credit is allowing an increasing number of Russians to make ‘luxury’ purchases. Press reports state that VTB, Russia’s second-largest lender, expects to double its consumer credit portfolio to U$13bn in 2009 through VTB-24, its retail banking unit. Retail sales for BMI’s universe of Central and Eastern European (CEE) countries in 2007 were an estimated US$1.02bn, based on the varying national definitions. Total consumer spending for the region, based on BMI’s macroeconomic database, was US$1.48bn. Russia, Turkey and Poland together in 2007 accounted for an estimated 82% of regional retail sales, with the combined share expected to reach almost 83% by 2013. For Russia, the estimated 2007 market share of 41.6% is expected to fall to 40.4% by 2013. Get Full Details About This Report >> |
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