Over the past year, Russia’s currency, the ruble, has lost two-thirds of its value to the US dollar, largely due to declining oil prices and Western sanctions sparked by the conflict in Ukraine.
Here in Cambodia, the ongoing currency decline is causing the dollar value of Russians’ savings to plummet, even leading to cutbacks in certain sectors.
In Sihanoukville, where the street signs on Serendipidity Beach ask tourists in Russian, Khmer and English not to litter, some Russian business owners are tightening their belts.
Zogir Ibragimov, owner of Cambodia’s only Uzbek restaurant, The Spot, said significantly fewer tourists are expected to come this season.
“We’ve had to undertake measures by introducing special deals, because obviously the people have [less money to spend].”
Ibragimov said the ruble’s decline has hit Russian expatriates in Cambodia especially hard, since many of them retain an income by renting their homes in their homeland.
Real estate agent Ruslan Gronov told the Post that Russian tourism to the coastal province was clearly dampened by the ruble’s weakening.
“One month ago many, many Russians were coming to Cambodia, especially from Thailand because the visa is easier to get here,” he said. “But now, I can see it is quiet.”
Currently, the ruble is buying just US$0.01, compared to December 2013, when the Russian currency was trading at more than US$0.03, according to currency website, XE Currency.
Vandy Ho, co-chair of the Private and Public Sector Tourism Working Group, said that while Russians represented only a small part of the overall tourism scene, they drive development in certain areas such as Sihanoukville.
“They spend a lot of money in Cambodia,” Vandy said.
According to the Ministry of Tourism, 132,000 Russians visited Cambodia last year, a number which the government forecast to rise to 150,000 in 2014.
But, as the ruble continues to decline during Cambodia’s most popular tourist season – November to January – Vandy said the ministry’s forecast is unlikely to materialise.
Seng Bonny, executive director of travel agency Eurasie Travel, said the group had seen a 40 per cent decline in Russian customers compared to December last year, although added that he could not speak for the entire industry.
“The numbers could change, but we can’t do anything about the [ruble crisis].”