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Ruble devaluation hits Chinese businesses in Russia

(Xinhua) Updated: 2014-12-20 17:45

VLADIVOSTOK -- A plunge in the value of the ruble has hit Russia's economy and exerted visible influence on Chinese businesses in the Far East region.

Chinese businessmen in Vladivostok, a Russian port city, told Xinhua that the depreciation of the ruble has pushed up prices of meat, fish, and grain, hurting their businesses.

Liang Xiaowei, a restaurant manager in Vladivostok, said the restaurant is facing the most difficult situation since its opening in 2001.

The restaurant has secured only 38 reservations for New Year celebrations, he said. "We used to have about 200 people celebrating the New Year in our restaurant."

Liang said the ruble's devaluation is the main reason for poor business. "I wish the situation would get better soon," he said.

Ma, another restaurant manager in downtown Vladivostok, said that the prices of meat, vegetables and dressings are going up and his restaurant is getting quiet.

"The ruble exchange rate affects not only Russians, but also the Chinese businessmen living here. We have not raised the prices in our restaurant yet, but it will happen after the New Year," he said.

Some of the Chinese businessmen trading at the Sportivnaya market, the largest trading area in Vladivostok, have closed their shops due to the devaluation of ruble.

Ran Peng is a salesman for a vegetable store, the only Chinese grocery store that remained open at the Sportivnaya market. He told Xinhua that the Chinese shops there cut off business within a week.

A new Russian market manager has said the rent would be up next year by a third or a half. "That is why they left," said Ran.

"I want to try and sell the vegetables in stock, and then decide whether to stay or leave," Ran said.

However, there are still some Chinese who believed the situation would be improved. "I believe in (Russian President Vladimir) Putin, and it will get better within six months," said yet another manager of a Chinese restaurant.

Putin is confident about China-Russia trade and economic cooperation. At an annual end-of-year press conference, he said he believed that Russia-China trade would keep the momentum with volume to reach $90 billion this year although the world economy is in trouble.

The ruble has lost nearly 50 percent of its value against the US dollar and the euro since March, despite several currency interventions of the Central Bank.

The Russian currency plummeted to historic lows Tuesday, with the euro briefly hitting 100 rubles and the dollar 80 rubles respectively in Moscow trade.

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