U.S. and EU Sanctions on Russia are killing off the tourism industry … in Ukraine!

U.S. and EU Sanctions on Russia are killing off the tourism industry … in Ukraine!

by John-Henry Hill, M.D.

August 2, 2014

I am an American who has been living primarily in Ukraine since 2009. My wife and I live most of the year in Odessa, Ukraine situated on the northern shores of the Black Sea. It is a beautiful and historic city, long a port of entry for trade into Europe, with archeological ruins dating back to the ancient Greeks and beyond. Odessa’s primary industries are its enormous port and tourism. Odessa is a Russian city by culture and language; and very few people use the Ukrainian language. But it is most accurately described as a city of many mixed cultures, with people from all over the Mediterranean area and beyond calling Odessa home. Geographically Odessa resembles an enormously long, very narrow crescent or semi-circle surrounding a huge bay. Driving from the Fontanka district in the north to the Illichivsk district in the south can easily take 2 hours. In the center of this crescent perched upon a high bluff is the city center, below which are located the port facilities. To the north and south of the port facilities are enormous beautiful beaches, with boardwalks and streets lined with literally thousands of restaurants, hotels, bars, night clubs and tourist attractions of all sorts. Even the city center appears as if it were designed for tourists, with hundreds of restaurants, 5-star hotels and shopping centers clustered around the famous cobble-stoned Derisbasovskaya Street (no automobiles allowed) and the grand Odessa Opera building. (Indeed, there is one hugely popular restaurant/bar on Deribasovskaya Street where conversations are more likely to be spoken in English or German than Russian. It also serves as an unofficial meeting place for expatriates of many nations.) The people of Odessa are extremely friendly and eager to help foreigners. Even the police, usually unarmed in the “tourist areas”, are extremely polite and even deferential. Odessa is truly a tourist’s paradise.

In past years the end of June through August saw the beaches of Odessa jammed with people. Restaurants and bars, most with open-air tables, would be crowded throughout the day and long into the night. And making reservations at a hotel near the beaches was next to impossible. Even the large parks adjacent to some beaches, where people are allowed to set up tents and small “campers”, would be jammed. However, Odessans love the beach, so distinguishing between the “locals” and the tourists is difficult, especially on weekends and weekday evenings. From my experience the best measures of the tourist population are: 1.) the number of people on the beaches during weekdays; and 2.) the license plates on vehicles parked near the beaches and beach-side hotels (revealing the owner’s country of origin).

Except for downturn in tourism in 2008 resulting from the world-wide economic crash, I have noticed in past years that most (perhaps 90-95%) of the license plates on cars parked near the beaches and nearby hotels were Russian. For many Russians, especially the rapidly expanding Russian middle class, the favorite summer vacation destinations were Crimea and Odessa. These Russians have money to spend – and they spent it profusely on vacations in Odessa. At the beach closest to our home there are two major complexes adjacent to the beach built specifically for tourists. The first is a massive hotel with hundreds of small, but very expensive rooms. If you have a room there with a view of the sea, you could literally jump out the window and land on the beach. It is on a gated street and has its own parking lot. The second complex is a collection of many small family-style cabins in a gated park-like area. The beach is literally less than a hundred feet away. Both of these complexes are surrounded by literally hundreds of restaurants, bars, night clubs and shops within easy walking distance. In previous years during our walks through these two complexes, I rarely saw cars (usually very expensive cars such as Mercedes, BMW or Audi) that did NOT have a Russian license plate. However, when we walked through these complexes last week, I noted one Russian license plate at that hotel complex, while the hotel area itself was nearly deserted. The complex of cabins at the northern end of the beach had NOT one car of any nation. The security guard with whom we spoke told us that NOT one cabin had been rented out, so the owner had closed it down completely, along with his restaurant and nightclub on the same premises.

During the summer weekends the beaches of Odessa normally are jammed with so many people that finding an empty spot on the beach to park yourself and your belongings can require considerable walking. Odessans tend to bring food and drink from home to the beach for a picnic or a barbecue in the beach-side parks. If they make any purchases at the beach-side stores, it is mainly for cold beer. Weekday evenings often have less-crowded beaches, but most of the people are “locals” out for a brief swim, then a walk down the beach or the boardwalk, perhaps stopping for a cold beer and a smoke with friends. It is on weekdays before 5 PM that the tourist population at the beaches can most accurately be judged. One also quickly notices that most of these people are in family groups.

In past years on weekdays around noon-time these family groups and other non-locals quickly filled the beach-side cafes and restaurants, as well as the nearby “souvenir shops”. By late afternoon these families had left the beaches and by early evening the beach-side restaurants and cafes rapidly filled with customers – again primarily families and non-locals. Long waiting times were the norm, as Russians tend to eat very slowly and linger at the table for extended conversations and drinks. (I tell my wife that Russian people go to restaurants in order to have long conversations, with the food and drink being almost an after-thought.)

This summer, with the U.S. and EU sanctions on Russia, the Russian tourists a very few and far between. During weekdays the beaches are not crowded in the least and during the evening the restaurants are nearly empty. Indeed, on our most recent weekday trip to the beach (one of the most popular beaches in Odessa), the people were sparsely located and numbered perhaps about 10% of a typical sunny weekday in July. Later in the evening, we and one other couple (apparently from Germany) were the sole customers at the open-air tables outside a hugely popular beach-side restaurant.  (See PHOTOS below) And when I wandered inside to use the restaurant’s bathroom, there was not one customer inside the restaurant. We asked our waitress if business had been slow. Her reply was that so far this summer, that evening was a “busy night”. Finally, during a short walk past several huge beach-side night clubs, usually jammed with young people, we noticed that they were all closed.

My observations and comparisons of past and current economic activity at the beaches of Odessa hardly qualifies as a “scientific study”. However, I believe that these observations indicate that the tourism business on which the economy of Odessa greatly depends is being greatly harmed by the conflict in eastern Ukraine and the U.S. and EU sanctions imposed upon Russia.

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