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Thousands of Russians stranded abroad after tour operator fails

Russia was striving to bring back nearly 16,000 tourists stranded abroad after the latest in a string of travel companies failed amid strains over the crisis in Ukraine, tourism officials said Monday.

MOSCOW: Russia was striving to bring back nearly 16,000 tourists stranded abroad after the latest in a string of travel companies failed amid strains over the crisis in Ukraine, tourism officials said on Monday (4 August).

With Western sanctions threatening to tip Russia's ailing economy into a recession and the value of the ruble taking a beating, the number of Russians travelling abroad has been cut by as much as half according to industry sources.

The Labirint (Labyrinth) company announced on Saturday it had halted operations, leaving 27,000 Russians "abroad without return tickets," the Tourhelp service of Russian foreign tour agencies said Monday. Officials said that after making emergency arrangements they had been able to bring a third home, cutting the number stuck abroad to just under 16,000.

Labirint is the fourth Russian tour operator to go bust in the past three weeks, stranding more than 50,000 abroad, as jitters over the conflict in Ukraine have led to a slide in bookings for overseas trips.

"The negative political and economic situation has influenced the number of bookings" and a drop in the value of the ruble "has hit buying power" of Russians, Labirint said in a statement explaining the halt in its operations.

TOURISM HALVED

While Western sanctions have yet to have a significant direct impact on the Russian economy, the Ukraine crisis and the threat of punitive measures has hit the value of the ruble, which has slid by 11 percent from a peak last September.

Even before the Ukraine crisis, economic growth had nearly stalled and the country could fall into recession. Citing tour operators, Tyurina said the number of Russians travelling abroad is down 30 to 50 percent from last year, while the number of foreign tourists visiting Russia is down 30 to 55 percent.

After booking too many places on charter flights at the start of the season, tour operators have been hard hit. "First the euro and dollar rose, then there were cancellations from those prohibited from leaving the country," Tamara Khaletskaya, head of the Solvex-Tourne travel agency, was quoted as saying in an article posted last month on the website of the Russian Association of Tour Operators.

Russia recently imposed restrictions on those who work in sensitive government positions from travelling abroad. A spokeswoman for Russia's national tourism agency Rostourism, Irina Shchegolkova, said on Echo of Moscow radio: "We worry that this is only the beginning and that there will be a domino effect."

She said Russian tourists in Greece whose hotel stays had not been paid for by Labirint were being allowed to remain for the time being, but some of those in Turkey were being turned out of their rooms.

Rostourism acting chief Oleg Safonov later said the agency would create a blacklist of firms that mistreated Russian tourists who ended up in such situations. "Unfortunately, we encounter cases where foreign partners turn out tourists and treat them very harshly... so we plan to create a list of such partners with whom it will be recommended to avoid doing business," he told the Interfax news agency.

"PYRAMID SCHEMES"

Russian Prime Minister Dmitry Medvedev lashed out at tour operators and ordered the authorities to monitor their finances and close those found to lack sufficient reserves. "All these tour agencies are operating like pyramid schemes ... and then say: 'Oh sorry, we have too few clients'," Medvedev was quoted as saying by Interfax.

Russia's federal investigative committee said on Monday it was probing Labirint and another tour operator which failed last month, Neva, for possible fraud.

EU sanctions have so far forced the Aeroflot national flag carrier's low-cost airline Dobrolet to suspend operations because of its service to Crimea, seized from Ukraine by Russia in March. The controversial flights to the strategic Black Sea peninsula prompted Western leasing companies to cancel contracts for the carrier's Boeing aircraft.

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