bne's Christmas Tree Index - felled by recession

By bne IntelliNews December 19, 2008

bne -

You can tell the age of a tree by looking at its rings, but it also appears you can tell the depth of the economic crash by the size of the municipal Christmas trees going up across Central and Eastern Europe.

In the Czech Republic - whose economy is slowing much more rapidly than first thought, though will probably avoid outright recession - the Christmas tree that stands in Prague's Old Town Square is as big as last year's. The 30-metre spruce was cut down in the Krkonoše area and then shortened to 22m. Given that few predict any growth next year at all, a similarly sized tree might be apt, but more likely is that jittery Czech officials don't want a repeat of Christmas in 2003 when their taller tree fell over and put several tourists in hospital. Still, in a nod to the glum mood descending on the country, this year's tree is festooned with lights that look like falling tears.

In Hungary, a country that has been plagued by sub-par growth for several years and is flirting with recession, the Christmas tree in Budapest is actually a fair bit taller than last year, standing at 18 metres compared with 13 metres in 2007. "Maybe it's a case of using a bigger tree to cheer up the masses this year," chirps one resident. But then Hungary is in such a mess because the government is very good at spending money it doesn't have. So maybe it is not surprising the city decided to buy a taller tree than last year, just as the economy teeters on the brink of collapse.

If the height of the tree is proportional to the happiness of the people, then Romanians were ecstatic last year thanks to their 76-metre-tall monster of a tree. No word yet on the height of this year's tree, but given that latest figures show the economy is still barreling along at 9.1% it should be even higher. Some economists are predicting an almighty crash next year, so hopefully it won't be blown over like its Czech counterpart was a few years ago.

In Russia, whose stock market is down almost 75% since the start of the year, the government was denying there was a crisis until recently. "Only a month ago people had no idea of what was going on and were spending as freely as ever. The jobs cuts and freeze on lending has come as a complete surprise for many," Ivan Svitek, CEO of Home Credit Finance Bank in Russia, told bne. So it is hardly surprising that all the Christmas trees in Moscow's squares are big, fake, plastic jobs.

Even the snow is fake. Normally the streets in Moscow are impassable and it's easier to get around on a sledge than a car at this time of year. But a quirk of weather means the streets are bare, bar a light dusting of what Russian weathermen describe as "technical snow" - something to do with humidity from factory chimneys freezing and falling to earth as snow. It was technical selling that brought the equity market to its knees and the last thing Muscovites want to hear about this year.

In the Baltics, which are all, to a greater or lesser degree, feeling the global pinch, Latvia has a special relationship with Christmas trees. Not only does every Latvian citizen have the right to chop down a single fir tree from common land each year, but Riga claims to have had the very first Christmas tree, with a plaque marking the exact spot in the town hall square.

With Latvia suffering the hardest landing of all the CEE states so far, it's instructive that this year's 19-metre-tall effort is noticeably shorter than last year's 21-metre giant - but even that rate of shrinkage is small compared to the shrinking Latvian economy.

And such is the symbolic importance of the Christmas tree in the Latvian psyche that the nationalist "For Fatherland and Freedom" political party has been airing a broadcast in which Russians turn their noses up the chance to buy a proper Latvian Christmas tree from market traders, preferring instead to buy plastic ones made in China.

Here's hoping for bigger trees next year.

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bne's Christmas Tree Index - felled by recession

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