The effects of the war in Ukraine are strongly felt by the artisans of Réunion. The Chamber of Crafts and Crafts of Réunion carried out a survey of artisanal companies on the island: half say they are affected by the consequences of this conflict.
The Ukrainian conflict has lasted almost three months, with consequences for us. Rising prices, supply difficulties…: this Friday, May 20, the Réunion Chamber of Commerce and Crafts (CMAR) took stock of the situation and presented the results of its inquiry into the impacts of the Ukrainian crisis on craft economy. A survey conducted May 2-8 with a panel of 340 island volunteer craft businesses.
Bernard Picardo’s details at La 1ère Reunion:
Pei handicrafts “impacted” by the war in Ukraine: Bernard Picardo, guest of the Journal
The president of the Chamber of Crafts and Trades, Bernard Picardo, is concerned: “There are sectors that are most affected, such as food or construction, but they are all impacted by this crisis in Ukraine.”. According to the CMAR report, one in two craft businesses is impacted by the war in Ukraine, with exposure to the crisis different from one sector to another, when they were already weakened by the Covid crisis.
Bakery companies, for example, have 69% of difficulties, that is, more than two out of three companies. While they are only 17% to express difficulties in the auto mechanic activity.
But how is the crisis impacting these companies? One-third of them encounter shortages or extended lead times, while two-thirds have to deal with increases in production costs. Numerous increases as they concern energy, freight, fuel and raw materials all at the same time.
All this puts us in a very complicated situation. Costs are increasing on all sides and we must maintain a balance so that the consumer is not the most impacted.Bernard Picardo, president of the CMA
Indeed, handicrafts have to face inflationary pressures that have an impact on artisan production. The price of olive oil rose by 50%, that of butter by 32%, that of flour by 31%, or even meat by 33%… The price of packages or cutlery is not left out: +28%.
In civil construction it is not much better: +54% in the price of steel and aluminum, +36% in wood and materials, according to CMAR data.
These difficulties are largely due to unexpected effects between suppliers or tensions in international markets. But its main cause remains linked to interrupted maritime traffic (65%).
So it’s no surprise that craft companies have to adapt, freezing their investments to 34% of them, reducing their margins to 72%.
Half of artisans say they have been forced to raise their selling prices.
Three-quarters of companies are taking responsibility despite rising costs. But we have some of our sectors that were forced to raise their prices in order to maintain balance and continue generating results.Bernard Picardo, president of the CMA
Faced with this situation, artisans expect support measures from the government, namely deferrals or partial rebates of taxes and social charges, or treasury facilities. “It was made during the health crisis”, comments Bernard Picardo, who also encourages business leaders to “don’t be alone and get closer to CMA services so we can tell you what’s out there in terms of devices”. The economic and social resilience plan, presented last March, is one of them.
In addition to these measures directly related to their cash flow, almost half of the companies questioned call for price regulation and control of price abuse.
Because it is, concludes the president of the Chamber of Commerce, the survival of a sector that supports more than 50,000 families in Réunion. Requires the action of “communities that can also set up support systems so that we can continue to serve our population at reasonable prices”.