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Backlash over ‘Russian-only’ companies in Thailand’s Phuket

Backlash over 'Russian-only' companies in Thailand's Phuket

Locals on tourist resort island claim Russians fleeing the fallout of the war in Ukraine are stealing Thai jobs.

A massive influx of Russians into Phuket is provoking a backlash from the locals, who are complaining about a thriving Russian-only economy that includes everything from hair salons to transportation companies.

More than 400,000 Russians arrived on the Thai tourist island between January and July of this year, according to the authorities, which is double the number of Russian visitors prior to the conflict in Ukraine.
As a result of Russian President Vladimir Putin’s full-scale invasion of Ukraine, many have obtained long-stay visas, purchased properties, and established enterprises to avoid economic turmoil and the possibility of conscription.

In July, Russian Foreign Minister Sergey Lavrov traveled to Phuket to inaugurate a new consulate to accommodate the rising number of Russian citizens seeking employment and recreation on the island.

The expanding Russian presence is accelerating change.

Although this is a boon for Thai property owners and real estate agents, it has made it more difficult for renters to locate affordable housing on the island.
There has been a proliferation of Russian-only enterprises, which are frequently operated via Russian language apps and staffed by illegal immigrants.

There have also been reports of Russian sex workers functioning in the Bangla Road nightlife hub, primarily for Russian customers.

The Russians are the sole owners of the ruble.

According to Prayut Thongmusik, president of the Phuket van drivers’ club, which represents 200 tourist minibus operators, “These Russians who have come to run the entire tourism industry are affecting us.”

“They drive personal vehicles that are not registered with the Thai transport department as service vehicles and pick up tourists who reserve them through a Russian app, offering nearly 20 percent lower rates than us.”
Thongmusik added, “They ensure that all the roubles stay with the Russians.”
On local Facebook pages, posts capture the growing anxiety of locals who fear their livelihoods are under threat and that Thais are becoming the on-paper owners of tourist businesses on behalf of Russian investors.

Some postings contain photographs of Russian taxis and individuals believed to be Russian workers.

“These guys make it themselves and eat it themselves,” remarked one Facebook user. “Russians are stealing employment from Thais. Things will spiral out of control if we do not regain control.”

The Phuket police force announced the arrest of a number of illegal workers last month, some of whom angry locals had identified.

“Three Russian nationals who opened a hair salon were arrested after a Thai citizen filed a complaint,” Lieutenant Colonel Thongchai Matitam told Al Jazeera. We charged them with violating the law for performing tasks reserved for Thai nationals only.
Additionally, there are worries that business rivalries and criminal activity may accompany the influx of Russian capital.

On June 8, Phuket immigration authorities arrested a Kazakh man on suspicion of shooting Dmitry Aleynikov, a 44-year-old Russian businessman, in broad daylight as he sat in his vehicle in front of a busy cafe.
On Monday, a 31-year-old Russian man was detained on the resort island of Koh Samui for alleged ties to Cambodia-based con artists.

Multiple Russian criminals have been detained while hiding out in other resorts including Pattaya, which in recent years acquired a reputation as a base for fugitive Russian mafia figures.

While authorities in Phuket emphasize that the vast majority of Russia’s population in Thailand is law-abiding, some Russians in Phuket are concerned that they are being unjustly singled out.

“Even the criminals that people see may not be Russians,” Sergey Malinin, a Russian expat who has resided in Thailand for 25 years and is a tour operator, told Al Jazeera.

“To Thai people, they are all Russians, regardless of whether they are Uzbeks, Ukrainians, or Georgians.”

Malinin stated that some Russians labor illegally in Thailand as a result of the country’s restrictions on foreign workers, but cultural and economic ties are growing between the two nations.
Simpsonmarine Phuket, a seller of luxury boats, stated that its largest customers are Russians purchasing yachts worth many millions of dollars, with the number of Russian buyers increasing by 10-20% since the conflict.

Thai state media reported that on August 15, the Phuket Tourist Association sent a delegation to St. Petersburg for a roadshow aimed at attracting approximately $1.7 billion in revenue from its top market.

In the meantime, real estate prices are soaring as Russians seek refuge from an ongoing conflict.

“Phuket has a limited amount of land, so real estate on the paradise island will only increase in price,” Sofia Malygaeva, a Russian real estate agent based in Phuket, told Al Jazeera, adding that many customers are purchasing off-plan properties for 20 to 30 million baht ($560,000 to $850,000).

“Some Russians become criminals in Thailand because they cannot find legal employment. They cannot acquire any more visas… They have money but cannot obtain employment; the only way for them to remain is to break the law, he said.

The substantial contribution of Russians to the local economy is particularly significant in light of the sluggish post-pandemic rebound of Chinese tourism, which is struggling against a slowing economy.
“They still have businesses in Russia or work remotely, but they want their family to reside in Phuket with their children,” she added.

“They understand it’s a safe place to be.”


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