New figures from Global Blue reveal a five-year-low in International spending in the U.K., fueled by political unrest & weakened currencies in key shopper nations
New figures from Global Blue reveal a five-year-low in International spending in the U.K., fueled by political unrest & weakened currencies in key shopper nations
-International tax free spend down -4% YOY for January to July 2014
-Shoppers from Russia and Thailand saw the biggest decreases in spending
China and Middle Eastern nations continue to lead spend, despite slow growth
-Global Blue, international retail tourism experts, reveal that tax free spend by globe shoppers coming to the UK has fallen for the first time since the aftermath of the global financial crisis in 2009, down -4% YOY for the period January – July 2014.
Political unrest and weakening currencies in some of the typically top spending shopper nations have been pinpointed as the key influencers on the fall in spend and is evidenced by that fact that the UK is not the only nation affected.
Global Blue, which operates tax free services in 43 countries around the world, has reported a drop in spend across all leading retail tourism destinations for Q2 of 2014, down -3% YOY overall.
“ Tax free spend in the UK has fallen for the first time since the aftermath of the financial crisis ”
“Shoppers from our top spending nations are spending more per transaction (+1% YOY overall for the UK) than before, but are making less purchases than they would have made in the past,” explains Gordon Clark, UK Country Manager of Global Blue.
“Political unrest and weakened home currencies resulted in the UK seeing a -4% YOY reduction in the sales in store from Tax Free shopping. More than ever now British retailers and hotels need to review their international marketing plans,product range and staff training to ensure they still continue to secure this crucial international spend.”
“As the two top markets, China and Middle Eastern nations have continued to lead spend in the UK, but growth has slowed; Chinese spend is up +8% YOY so far this year, much less than the 20-50% growth we have seen in the past few years. However, as economies begin to recover, we expect to see growth from key nations pick up again.”
“ China & Middle Eastern nations have continued to lead spend in the UK, but growth has slowed ”
Russia has been suffering a weakening economy since the end of 2013, and as the effect of the Ukraine crisis exacerbated the situation, the rouble reached a record low this year. Russian shoppers visiting the UK have been left disadvantaged against the sterling, resulting in the -20% YOY drop in spend seen by Global Blue.
Thailand was identified as one of the key nations to watch in 2013, and total spend by Thai shoppers was reported to be up +46% YOY at the end of the year. However, Global Blue figures show Thai spend down -27% YOY this year to date, again largely due to the depreciation of their currency.

TAX FREE SPEND INDEX H1 2014
Sources: Global Blue ©
Political turmoil in the first quarter of 2014 also caused significant impact on the Thai economy, resulting in a reluctance for Thai outbound travel, but economic growth has now pulled back in Q2 just enough to avoid dipping in to a recession.
Global Blue works with over 270,000 of the world’s favourite retailers, shopping brands and hotels in over 40 countries and serves in excess of 60,000 travellers each and every day. The company’s ambition is to become the beacon for international shopping and spending across the globe.
