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Russian rouble trouble for North East firms

The plummeting value of the Russian rouble could herald difficulties for exporters from North East England.

The oil and gas supply sector has already been affected by the sanctions imposed on Russia by western countries in the summer. The Russian’s tit-for-tat ban on food and beverage imports has also hit western producers.

Aidan Stradling, Director of the Anglo-Russian Centre in North East England, said: “The rouble’s steep decline in recent days has suddenly made it much more expensive for Russians to import goods from abroad.”

“Businesses there are resilient, though”, Mr Stradling continued. “They will know what goods and services they can buy more of within Russia and will be busy digging in for the long term.”

The rouble has fallen in value by 60% so far in 2014, and now stands at around 95 to the pound.

However, it may not be all gloom and doom. Mr Stradling added: “Many Russian firms have foreign currency accounts overseas, and will continue to purchase high quality items from existing customers with euros or dollars. Russians don’t like banks, and any company trading internationally will have a good chunk of its resources in foreign banks. It’s virtually the mainstay of the Cypriot economy.”

“Prices in Russia are expected to rise across the board, and both firms and individuals are buying up stock at current prices. In fact, now is a good time for British firms to be sourcing goods and services from Russia while they are still relatively cheap.”

The Anglo-Russian Centre in North East England links up small businesses in English and Russian regions.

This was posted in Bdaily's Members' News section by Aidan Stradling .