Fall of the Ruble: Russia's Currency Woes Threaten International Tours

Ozzy Osbourne of Black Sabbath
Dima Korotayev/Kommersant via Getty Images

Ozzy Osbourne of Black Sabbath performs onstage at Olimpiyskiy stadium on June 1, 2014 in Moscow, Russia. 

As Russia's currency, the ruble, took a new plunge against the dollar and the euro in late 2015 and early 2016, promoters in the country are scaling back the number of shows by foreign artists. Over the last three months the ruble has lost more than a quarter of its value against the dollar and has weakened by 60 percent over the last couple of years.

"Of course, the number of shows [by foreign acts] is to drop," Eduard Ratnikov, head of promoter T.C.I., told Billboard. "Major shows that are currently on sale, were announced before the major drop in oil prices in last November and December, which hit the ruble and the entire economy.

"In such a turbulent situation, promoters are very careful now when it comes to hard-currency contracts," he added.

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Promoters' biggest problem is the fact that artists' fees are nominated in US dollars or Euros, and tickets are sold in rubles, and rising prices in accordance with the exchange rates would make many shows unaffordable.

"Ticket prices have gone up by about 20 percent to 30 percent over the last couple of years," Dmitry Zaretsky, general director of promoter Pop Farm, told Billboard, adding that in this economic situation, this is just about as high as promoters could go.

Tickets for shows by the likes of Lana Del Rey and Red Hot Chili Peppers, scheduled for later this year, currently sell at 4,000 rubles to 8,000 rubles (roughly $50 to $100).

Last year, promoters already had a hard time staging shows by Western acts after the ruble took a major plunge in the second half of 2014. While the ruble partly rebounded by the summer of 2015, giving promoters reason for cautious optimism, the current devaluation is sharper and, against the backdrop of a major economic downturn, the ruble's recovery may be a distant prospect.

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"We are nervously following the exchange rates and trying to negotiate with artists -- who don't care about our problems," Ratnikov said. "Many would rather remove Russia from their tour schedules than agree to lower fees."

The situation could give a boost to local acts, who don't demand hard-currency-nominated fees, but promoters say that is not the case. "Import substitution in the live industry isn't possible," Alexei Potapov, general director of Spika concert agency, told Billboard, referring to the government's strategy to boost consumption of local products rather than imports.

"There are two scenes, the local scene and the foreign scene," he explained. "Fans of Judas Priest will never go to a show by [local veteran pop singer] Valery Leontyev just because Judas Priest isn’t coming to their city."