ALPBACH: Weakness in the rouble may wipe out any gains by German retailer Rewe in Russia, which remains its fastest-growing market in local-currency terms despite sanctions on food imports, the head of the group's international operations was quoted saying.
Frank Hensel told Austrian newspaper Wirtschaftsblatt that the decline of the rouble, which has suffered a sharp sell-off linked to Russia's perceived role in the Ukraine crisis, would offset the growth the company was achieving there.
"We have 97 Billa stores in Russia and a high degree of independent supply channels. But our selection (of products) is affected and we are observing the situation very carefully," Hensel told the business newspaper in an interview published on Wednesday.
"Our business in Russia and Ukraine is still developing in a satisfactory way. In local-currency terms, Russia is even our most dynamic market. But by the end of the year that dynamic will not be so visible because of exchange-rate fluctuations."
Moscow banned imports of most food from the West earlier this month in retaliation against EU and US sanctions over the Ukraine crisis.
Products hit by sanctions will be sourced from elsewhere, such as Turkey, Belarus and other former soviet satellite states as well as from overseas, Hensel said on the sidelines of an economic forum in the Tyrolean village of Alpbach.
"(The customer) will have the same selection, it will just come from somewhere else and under certain circumstances at higher prices," he said, without giving further details.
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