Moscow fashion elite feel bite of financial turmoil

Models present fur creations during a fur fashion show at the Supreme Luxury Conference in Moscow November 29, 2007.

The champagne-quaffing crowd of Moscow's fashion elite are beginning to feel the weight of the global financial crisis as it spreads from the bankers and investors through the strata of Russian society.

Hundreds of green-shelled oysters were served on silver platters on Wednesday night to celebrate the opening of a new store by one of Russia's most celebrated designers, 40-year old Igor Chapurin, but for some the mood was somber.

"Now it's only starting. We will see how it will really be in two or three months," Muscovite Dmitri Ashman, who owns music promotion company Zeppelin, told Reuters.

"It's become harder to chase payments, the industry is not working so well right now. I'm worried," said Ashman, who will soon open an exclusive nightclub, 'Kitschcock', in the city center.

The Russian luxury market is the world's fourth-largest and one of the fastest growing, and initially experts thought it could weather the storm of the global crunch.

But in an interview to Reuters on Wednesday, the managing director of the country's biggest luxury goods group Mercury said cracks are emerging in the industry's glossy facade, particularly for the small stand-alone boutiques.

Usually abuzz with Moscow's rich, the shop was populated only by the mounds of black caviar and giant lobsters left untouched in fridges.

Russia has been among the biggest casualties of the financial crisis, with stock markets tanking 70 percent since May and daily stock trading suspensions over the past few weeks.

"It's tough for Russia at the moment. Creatively, fashion always triumphs, but even this world is getting hit," said fashion promoter Stefan Leonardo, who has brought Chapurin's looks to the Paris catwalk.

At Chapurin's party, which flew in British pop singer Luciana Caporaso for the night to perform, the designer put on a brave face.

"The worst is when you have panic, the worst is when you have hysteria. I'm glad that in Moscow we're not seeing that," he said, standing in a brightly lit white room lined with his fur and taffeta creations.

"My friends, who are very rich, who are very very rich, and some also who are in the middle class, they are handling themselves in a very dignified and calm way."