‘Pure hypocrisy’: About three years after business withdrawal, Western luxury goods line up in Russian stores

Despite widespread Western sanctions and an exodus of global brands following Russia’s all-out invasion of Ukraine in February 2022, wealthy shoppers in Moscow still have access to a wide variety of Western luxury goods. are enjoying it.

The Russian capital’s upscale shopping districts, upscale department stores and local luxury outlet stores are buzzing with sales of Western sports cars, designer clothing and gold jewelry, contrary to early predictions of economic isolation.

“I don’t see much change,” said Natalia, a 51-year-old dentist, as she strolled through GUM, a luxury shopping mall on Red Square. “Maybe three stores have left: Chanel, Dior and Hermès. Everything else is the same as before. Brunello Cucinelli is also here,” she said, naming the Italian fashion house.

“Did they want to isolate us? Please! We are so isolated here, even strange,” said Sergei, a 61-year-old retiree, as he left the luxury store.

The United States, the European Union and the United Kingdom have banned exports of luxury goods to Russia as part of sanctions over the invasion of Ukraine. A number of brands, including Chanel, Hermès, LVMH and Kering, have also voluntarily withdrawn from the Russian market.

But almost three years later, many of the logos can still be found on store shelves in Moscow. Some of these brands have closed their stores in Moscow, while others have maintained their leases and signaled possible plans to return to stores.

“Their announced resignation is complete hypocrisy,” said a French businessman who sells luxury goods in Moscow. “Even though the stores are officially closed, these brands are still selling to Russians through ‘markets’ and dealers,” he added on condition of anonymity.

Sanctioned goods continue to flow into Russia through intermediaries in former Soviet states with close ties to Russia, such as Kyrgyzstan, Kazakhstan and Azerbaijan. Export data shows that trade between these countries and the West has soared since sanctions were imposed.

“For some reason, everything is imported,” said Elena, 38, a marketing manager for a luxury lingerie designer, as she shopped in central Moscow. “It’s a little complicated, but overall everyone can handle it.”

The shelves of Moscow’s TSUM department store are still stocked with products from brands such as Prada, Yves Saint Laurent and Alexander McQueen. The store advertises its prices as “more competitive than Dubai,” which has become a hotspot for wealthy Russians since travel to Europe became difficult.

Since the invasion of Ukraine in February 2022, “sales of luxury goods have exploded in Dubai,” said the French businessman.

Wealthy Russians are also turning to “buyers” who have revived a 1990s practice in which intermediaries buy luxury goods in European cities and ship them to Russia.

These buyers now work directly with boutiques in Milan, Paris and London to fulfill orders for furniture, tableware, jewelry and furs, Andrei, 52, a stylist for high-end clients, told AFP. he said.

Given the sustained demand for Western luxury goods in Russia, some believe that foreign brands themselves will also rush back if possible.

“It’s only a matter of time,” Andrei said.