Following the conflict in Ukraine and the economic sanctions decided by the international community against Russia, the Nice Côte d’Azur Chamber of Commerce and Industry launched a survey of 28,000 companies in the region to identify the impact and economic consequences of the war in Ukraine on their business activities.
The initial feedback from this large panel, representing more than one-third of the economic fabric, reveals that over 80% of respondents are affected by the crisis in Ukraine, and 60% of them expect a decrease in their turnover.
Four sectors are particularly affected: trade, tourism, followed by industry, and construction.
After two years of the pandemic, the trade sector had begun to regain momentum with an 8% increase in activity compared to 2020 (+1% compared to 2019), with retailers in food and home equipment seeing a significant increase in their business volume. Today, this sector accounts for nearly 40% of respondents and reports direct or indirect difficulties following the war in Ukraine.
Tourism is the second most affected sector, representing 15% of survey respondents. In the Alpes-Maritimes, Russian clients, with their strong purchasing power, account for 8% of the international clientele, with stays averaging one week to ten days. While the health crisis has already encouraged tourism professionals to explore new markets, the absence of Russian tourists is expected to result in a loss of 50 million euros for the year 2022. The industrial sector ranks third, representing 10% of responses, followed by construction with 7% of responses.
Nearly 60% of respondents are impacted by increased production costs linked to rising energy costs. More than 20% are already experiencing difficulties in obtaining raw materials. The war in Ukraine thus reminds France of its dependence on aluminum, with industry having only three months of stocks ahead.
France also relies on Russia for other raw materials such as palladium, platinum, nickel, iron ore, and steel, with significant risks weighing on the aeronautics and shipbuilding industries. The cessation of imports of neodymium gas from Ukraine adds an additional risk to the semiconductor industry, as Ukraine supplies more than 70% of neon, an essential component for lasers used in chip manufacturing.
Nevertheless, there are reassuring signs: 68% of respondents report that there is no cessation of activities nor a need for repatriation of personnel for 81%, due to the low number of subsidiaries established in Ukraine or Russia. Indeed, for 95% of respondents, the share of turnover directly linked to Ukraine or Russia is below 25%. Employment does not seem to be threatened for 68% of them either.
