Impact Of Football Games On Russian Economy – Part II

Dear Readers:

Today finishing up this piece from VZGLIAD, authored by Olga Samofalova.

Yesterday we touched on the fact that a veritable blitzkrieg of anti-Russian propaganda in the Westie media sought to scare fans away from attending the games; and, in some cases, for example English fans, this had the desired effect.  This effect could be called “Sochi Part II”.  As in the Sochi Olympics, where Westie propaganda organs played the “gay card” and also rolled out the usual suspects, like Pussy Riot, in an attempt to smear the Russian government as totalitarian; and hence ruin the games even before the Opening Flame was lit.

Pussies attempt to ruin Sochi Olympics with bad performance art

The general rule is that, whenever Russia (or previously, Soviet Union) hosts a major international event, like the Olympics or the World Cup, then Westie media will either boycott or attempt to spoil the event in advance.  Using negatively slanted coverage, fake news, bias, cherry picking “human interest” stories, sneaky sniping, etc etc.

Paradoxically, by the time of FIFA 2018, the bar had been set so low, with foreign fans arriving in Russia expecting to see a horrifically backward and dangerous country, that encountering simple normality seemed like a paradise to them.  Story after story recounts this same pattern:  “I heard so many bad things about Russia… but the people here have been great, we are having a wonderful time..” etc.

“Mr. Spock, what is your opinion of football?”

Add to that, that ordinary Russian hospitality and attention to the needs of tourists, only needed to be in place to assist in the natural group endorphins which football fandom seems to engender.  I personally have never experienced this phenomenon myself (with football or any other spectator sport), but I note, empirically, like Star Trek’s Data observing the bizarre psychology of humans, that football fans are able to whip themselves up to a state of group ecstasy, only one step removed from mass orgasms.  All that the host nation needs to do, to latch onto the good vibes, is to present a safe and hospitable environment.  That, plus food and beer.  Lots of beer!  The fans will eventually leave, with good emotions and positive feelings about the host nation.  Over time, those feelings might fade, but still leaving a good buzz.  And that is how it’s done, my friends!

As Samofalova hints in her piece, and there are other pieces in the Russian press which repeat that meme, the games are expected to leave more of a long-term psychological impact than a pecuniary one; and yet there is some significance to the Russian economy; as well as hopes of more touristy type revenue streams in the future.  Hence, we return to that discussion:

So, in the first five days of the games, foreigners spent 2.5 billion rubles.  That’s great!  But wait!  The games themselves cost 15-25 billion rubles to stage.  We are quoting now from Anastasia Sosnova, a capitalist Analyst on the Executive Committee of Freedom Finance, who rudely points out that the games are a net loss.

Anastasia – approximate image

Also, according to Anastasia, who sounds like a “glass half empty” type of person, tourists usually spend more in the first few days, until they get wiser about the prices.

But Natalia Orlova from Alpha Bank counters Nastenka’s pessimism with this prognosis:  In the course of a single month these games could add around 100 billion rubles to the Russian consumer economy.  The Visa credit card numbers don’t tell the whole story, they only comprise 30-50% of the purchases.  The rest are allocated to other types of credit cards or cash purchases.  Natasha expects the games, as a whole, to add .1 to .2% to the GDP growth in this fiscal year.

Returning to yesterday’s friend, Mr. Alexander Razuvaev from the investment company Alpari, Sasha explains how the games will have a psychological effect:  “For Russia this is, primarily, a unique chance to break that negative image which people attempted to saddle onto our country, especially on the part of the global media.”

Football players wearing Alpari logo

From their website, Alpari looks like one of those high-power companies whose employees are forced to endure such team-building exercises as sky-diving or climbing Mount Everest.  Whatever makes them feel like they are Kings of the Universe!  Razuvaev points out that not everything in the world is just about money:  “In the contemporary world PR is very expensive, on it depend multi-billion dollar contracts and investment streams.  Russia must show the whole world that it is not a beleaguered fortress, but rather an open country, attractive to both tourism and business.”

Setting Sights On Tourism

Hence, Russia is seeking to leverage its World Cup success with an increase of tourism post games.  The government has already taken on this project:  this past Friday Prime Minister Dmitry Medvedev put out a proposal to subsidize foreign tourists.  Well, not the tourists themselves, but the travel agencies which bring the tourists, will receive subsidies, as was explained by the attractively-bespectacled Maya Lomidze, Executive Director of the Association of Tour Operators of Russia.

Tourism expert Maya Lomidze

Maya believes that the subsidies should go, not to Russian tour companies, but to foreign travel agencies who bring people into Russia; this is how it is done in other countries, such as Israel, Turkey, Thailand, Cyprus, and many others.  Here is how it is done:  foreign travel agencies receive a fixed subsidy per capita.  For example, Israel pays the highest amount of bounty in the world:  45 Euros for the head of each tourist brought into the country.  Given that a trip to Russia costs a foreigner, on average 2,000 Euros, a discount of even 45 Euros would not make that much difference to the tourist himself; however, the sum of such discounts will provide an incentive to the foreign travel agencies themselves, like, entice them to work more actively in the Russian tourism market.

Granted, it will not be that easy to lure foreign tourists to places like Samara or Rostov-on-Don, after the games are over.  Therefore incentives are required other than just monetary subsidies.  For example, a loosening (and simplification) of the (tourist) visa process.  [Since the visa application process is so cumbersome in itself], one possibility is to issue visas that can be used for more than one (tourist) entry-exit.

In conclusion, Russia needs to think of ways to attract more foreign tourists.  Tourists are good for the Russian economy, they are good for Russia, and Russia is good for them.  It’s a win-win situation!

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