Foreign online stores will conquer Russia in two years

Association of e-commerce companies (ACIT) hopes to tighten regulation of business.
In 2016, the Russian Internet market grew by 21% to 920 billion rubles, the Association of Internet Trade Companies (ACIT) estimated. Reviewing the results of the first half of the year, AKIT President Alexey Fyodorov admitted: "Perhaps there will be a miracle and we reach 1 trillion rubles. [According to the results of 2016]." The basic forecast of the association suggested an increase of 18.4% to 900 billion rubles.

Foreign online stores accounted for 33% of all online purchases of Russians amounting to 301.8 billion rubles. Against 29% in the previous two years, according to the association. The number of items from foreign online stores in pieces has more than doubled, while in the domestic market it has grown only by 6%.

In 2016, the ruble appreciated against the dollar, import goods became cheaper in proportion to this strengthening, as Fyodorov explains the increase in demand in foreign online stores by Fedorov. In 2015, Russian online retailers were selling stocks purchased at a low dollar exchange rate, and it was more profitable to buy in Russia, and last year the stocks were exhausted, and new purchases were made by retailers, including at peak dollar-ruble rates, he argues.

"In two years, there will be nothing left of the Russian Internet trade; we will sell only Chinese goods, and for China, Russia will become a market for duty-free trade in our territory," Fedorov said in a statement. If the growth rates of cross-border purchases continue, in two years their share may reach half of the Russian online trading market, Fedorov told Vedomosti. "Small equipment, toys, everything that goes in packages of up to 2 kg, will be completely absorbed by cross-border trade," he argues.

To correct the situation, VAT on foreign online purchases may be introduced, Fedorov believes. On Monday, deputy head of the Federal Antimonopoly Service Anatoly Golomolzin said that the service was working on such a bill. According to him, the document was "already in a good degree of readiness." "I think that within 1-2 months we will be ready to discuss it with a wider audience. Both with the departments, and with the public," Interfax quotes Golomolzin.

Last year, Russians bought the majority of goods in Chinese online stores (90%), while in money, China accounts for slightly more than half of the foreign purchases market - 52%, which indicates a low average check, according to ACIT. The largest audience - the Chinese online site Aliexpress - has more than 22 million people, followed by the Russian (about 9 million people),,,, etc. Revenues of in 2016 increased by 20% due to the expansion of the assortment, the network of regional warehouses, speeding up delivery, the company representative said, without revealing absolute figures.

According to the forecast of ACIT, according to the results of 2017, the amount of Russian online trade will be approximately 1.1 trillion rubles (+ 19.6%), including cross-border - more than 400 billion rubles. "In general, we agree with the above estimate of the Russian Internet market, and this year we also expect significant growth," said the head of "Yandex.Market" analytical department Vladislav Ismagilov. In his opinion, it will continue primarily due to small cities, new product categories, an increase in the number of mobile users and the further development of cross-border trade.