Balancing Russia's touRism deficit: a RepoRt on ... - Hilton Worldwide

12Industry OverviewIncreasing consumerexpenditureConsumer income and expenditure perhousehold in Russia, 2007-2016 (US$ ‘000)US$ ‘000 per household$40$35$30$25$20$15$10$5$012.5$11.8 $10.12007$0.6$21.3$34.6$29.99.5 9.3$19.0$1.020122016$1.61412108642$0Saving ratio %Annual disposable income per householdConsumer expenditure per household on leisure and recreationConsumer expenditure per householdAnnual savings ratioAlthough the Russian economy was affected by the globaleconomic crisis over 2008-2009, annual disposable incomeper household grew by 13%, with consumer expenditurealso rising by 13% over 2007-2012. In Russia, the estimatedaverage income per household in 2012 was US$21,300,which is very low compared to countries such as Germany(US$61,200) and the UK (US$55,600). On the other hand,Russia has one of the world’s highest number of billionaires.Therefore, the growth of consumer expenditure was highlyrelated to increased expenditure by these super-wealthyhouseholds.Consumer expenditure on leisure and recreation is expectedto account for 5% of total consumer expenditure perhousehold in 2012. Expenditure on leisure and recreationis mostly driven by increased expenditure on packagedholidays, which grew by 16% over 2007-2012. Due toincreased disposable income levels, Russians became morewilling to spend on vacations and tourism.Increased foreign investments, domestic consumptionand political stability in Russia significantly influencedconsumer expenditure and annual disposable income afterthe economic downturn. As the Russian economy recovers,annual disposable income per capita is expected to witnessan increase of 11% and consumer expenditure to continuerising by 12% over 2012-2016. These trends, alongsideincreasing globalisation and growing opportunities to travelabroad, will have an impact on the tourism industry. Theywill also support a 12% growth in consumer expenditure perhousehold on leisure and recreation over 2012-2016.