Sochi’s merchants ride Putin’s Olympic dream
KRASNAYA POLYANA, Russia (AP) Vladimir Putin isn’t the only one with a lot riding on the success of the Sochi Olympics. Local businesses and residents have a lot to gain if these Olympics fulfill Putin’s pledge to turn Sochi and its environs from a summer playground for well-off Russians into a year-round international resort for everyone.
But that’s a big ”if.”
The limited number of foreign spectators at these games is dampening dreams. So is all the negative attention around the not-quite-finished hotels, and the many ”For Rent” signs on empty apartments around the Olympic Park.
So merchants are trying to keep their spirits up by looking past the Olympics to an upcoming new Formula 1 race in Sochi and the 2018 World Cup. Maybe by then, the tourists will come?
”It would be nice to be able to stay open all year, so that no one has to take an extra job,” says Marina Nagabedian, whose family owns a convenience store near the sands of the Black Sea shore, not far from Olympic Park. In the past, her husband took a second job in the winter to help feed their two kids, and they just ”waited for summer again.”
”In summer, we have lines out the door,” says Nagabedian, in her 40s. This week, in the midst of the Winter Olympics, the store sees barely a trickle of customers. Many come in to get change for large bills instead of buying her wares: milk from regional farms, fresh poppyseed buns, ”Sochi”-emblazoned slippers.
A look back at past Olympics suggests the odds are against local businesses reaping huge rewards, despite ambitious promises. The 2004 games left Greece saddled with huge debt and didn’t lead to long-term benefits for businesses. Just a few years after the 1998 Nagano games in Japan, the city had little to show for its role as Olympic host. Accurate data is hard to come by, because governments don’t always want to find out – or publicize – whether the heavy expenditure was worth it.
Up the nearby Caucasus Mountains, Vitaly Pishchuk is doing brisk business at a cell phone franchise in Krasnaya Polyana, with about 600,000 rubles a month in turnover. Foreign tourists, construction workers – ”people from all social classes need us,” he says.
He hopes it stays that way beyond the Winter Games so that he can afford to take his 4-year-old son to a new Sochi amusement park dubbed Russia’s Disneyland. And maybe they’ll learn to ski. If business sags, the parent company will likely shut down his roadside shop and leave him looking for work elsewhere.
”The Olympics are a great advertisement for our city,” says Pishchuk, 34, who dreams of this region becoming Russia’s Monaco. ”Even if everything isn’t perfect … everything was done so that people will come back. That’s the main thing.”
Then he pauses and reflects on the challenge of attracting visitors here.
Americans have little incentive to cross half the planet for the Caucasus slopes. Europeans have the Alps, and more. Even drawing in Russian visitors, as the government hopes to do with a promised 42,000 hotel rooms and 150 kilometers of slopes, may not be so easy.
Vacationing here ”is pretty expensive for an average Russian tourist,” both up the mountain and down on the Sochi shore, Pishchuk says. ”You can travel to Turkey or Spain for 300 bucks.”
The partially completed shopping mall across the street has a boutique selling furs next to two high-end jewelry stores – but nowhere to get a cheap T-shirt.
Sochi, with its mild climate, once drew the Communist elite to its seaside resorts, but was widely seen as a summer destination. Putin then turned Krasnaya Polyana in the mountains above Sochi into his ski getaway.
The region’s $51 billion transformation for the Olympics has been by all accounts striking. But for all the money spent on Olympic infrastructure, 74-year-old Sochi native Dina Kobolenko says, ”This was a village, is a village and will remain a village” – not Russia’s answer to Las Vegas or Dubai.
She’s proud of her city, and can’t afford to be down on the games. Her three-generation household’s income depends in part on a tourist kiosk she manages selling maps, books and postcards outside the Sochi train station. Any extra profit she can make on a Russian-English map of town helps her 12,000-ruble-a-month pension stretch farther.
She was horrified at the amount of money spent on the games – ”That is a lot! A lot, a lot!” – not to mention the estimated $2 billion a year it will cost to maintain Olympic facilities. And she’s skeptical of the government’s projections of bringing in cruise ship business, doubling tourism to 6 million visitors a year and creating 600,000 jobs.
Even before Russia was handed the Olympics, economists had urged the government to diversify a heavily oil- and gas-dependent economy and invest in structural reforms. Instead the government has poured money into well-connected conglomerates funding the construction of sports venues, transport infrastructure, electricity and telecommunications, hotels.
Small businesses were never a priority, and Nagabedian says she feared the authorities would shut all independent business owners down for the Olympics ”because we don’t look perfect enough.”
But she and her husband have been able to work in peace, waiting for business to pick up, waiting for Sochi’s promised future to become, one day, its prosperous present.