When giant French retailer Carrefour arrived in Kazakhstan, it was deemed an event so important that President Nursultan Nazarbayev dropped in for the opening.

But on May 30, only 16 months after Carrefour opened its doors, the retailer announced they are closing up shop.

Tengri News website cited the general director of its Carrefour operations in Kazakhstan, Seung Dae-Ryu, as saying that the main reasons for the closure was the devaluation of the national currency, the tenge, and the intensity of local competition. 

In the last year or so, three supermarkets opened in the area near where the Carrefour store was located in Almaty, Kazakhstan’s business capital.

The retailer’s store opened in February 2016 amid much optimism. Its backers said that 5 billion tenge ($14 million at the time) had been invested into the premises, which covered an area of 8,000 square meters and offered 30,000 named brands. The supermarket employed around 450 people.

Initially, there were plans for another nine outlets in Almaty and in the capital, Astana. There was even talk of opening stores in other cities like Aktobe, in the west, and Shymkent, in the south, and then spreading elsewhere in Central Asia.

Much mirth was provoked during the 2016 opening when Nazarbayev chit-chatted with employees about dirty carrots and the fattening properties of the croissants on offer.

The then-head of Carrefour Kazakhstan, Stephane Maurier, even promised that Kazakhstan would see the imminent appearance of the Vox cinema theaters chain and Magic Planet family games and attractions centers, both owned by Carrefour’s UAE-based franchise operator Majid Al Futtaim Retail.

Maurier sounded a buoyant note in remarks to EurasiaNet.org, predicting that the persistent credit crunch would actually be good news for a retailer that traded on its affordable prices.

“The purchasing power of the country is quite high in the cities,” he told EurasiaNet.org. 

Claims that the retailer’s failure to break the Kazakhstani market are down to the devaluation of the tenge are a little perplexing. The tenge stood at around 360 to the dollar when Carrefour opened its store, but it has actually strengthened considerably since then, to around 310.

Carrefour made a similarly unhappy entrance into the Russian market in 2009. The retailer cut short its activities in Russia after only three months, citing a lack of development opportunities.

Carrefour is the world’s second-largest retail chain after the Wal-Mart in the United States. The company was incorporated in 1957, but the Carrefour brand has its beginnings in 1962. The company operates supermarkets, discount stores and round-the-clock, small-wholesale shops, as well as the giant hypermarket-style outlets of the kind it is now closing in Almaty.