Russian Revolution

Published: February 01, 2003, By Corey M. Reardon, AWA Alexander Watson Assoc.

Since the collapse of the Soviet Union in 1991, the boundaries of Europe have been expanded by the new market economy in Russia. It has been a struggle for the country to assert its new capitalism and achieve sustainable economic growth, but today — more than ten years on — it can look back on a 6% annual growth in the years 1999-2001 and increasing confidence in its stability.

Consumerism increasingly is taking a hold on the Russian population — estimated at nearly 145 million in July 2002 — and both international and domestic product manufacturers are taking advantage of this economic buoyancy. Foreign companies in consumer goods manufacturing are looking to avoid import duties and optimize margins by packaging, and sometimes manufacturing, their products in Russia itself, now that the climate for investment is improving there. This is good news for the packaging and converting industry as a whole. Our research for the new edition of the AWAreness Report on the Russian self-adhesive roll label market indicates that in 2001 growth exceeded 30% — a phenomenal performance in the European market arena.

Russia certainly represents a major opportunity for worldwide players at all levels of the packaging value chain, whether they are press manufacturers, manufacturers of packaging and labeling equipment, or suppliers of print substrates, including self-adhesive label stocks and other materials. The annual exhibition in Moscow, LabelShow (which takes place March 17-21, 2003), is firm evidence of the dynamism of Russia's own converting industry. However, it is interesting to note exhibitors at last year's show included international suppliers such as Akzo Nobel Inks, Avery Dennison, Chromas, Ko-Pack, Mark Andy, Nilpeter, Raflatac, and Standard Paper—proof that Russia represents the most interesting geographical market development platform in the packaging world today.