Netflix, TikTok, Samsung, and credit card operators have joined the list of companies considering doing business in Russia as they break their ties with Russia or increase their reputation and financial risk.
International sanctions, the closure of airspace and transportation links due to war, and the financial constraints of the SWIFT and capital regulations have made it difficult for many companies to supply and pay for parts and deliver goods to Russia. This means that potential international consumer backlash against companies that are considered to be supporting the Vladimir Putin administration means that the outflow of companies from Russia is skyrocketing.
After the collapse of the Soviet Union in 1991, the 30-year investment by foreign companies, especially in the energy sector, has reversed. Here are some of the biggest companies that have begun to unravel their connections.
Oil and gas
Russia’s largest foreign investor, BP Plc, led on February 27 with a surprising announcement to withdraw a 20% stake in state-owned Rosneft. This move could result in a $ 25 billion amortization and reduce the company’s global scale. One-third oil and gas production.
Shell Plc continued, citing Russia’s “meaningless military aggression.” The company said it would end its partnership with state-owned Gazprom, including its involvement in the Sakhalin II liquefied natural gas facility and the Nord Stream 2 pipeline project blocked by Germany. Last week, both projects were worth about $ 3 billion. Exxon Mobil Corp. Said to “stop” Sakhalin-I’s operations.
Norwegian state energy giant Equinor ASA has said it will begin withdrawing about $ 1.2 billion worth of joint ventures in Russia. At the same time, the world’s largest Norwegian sovereign wealth fund said it would freeze about $ 2.8 billion worth of Russian assets. Come up with a plan to finish by March 15th.
Visa Inc. And Mastercard Inc. Said on Saturday that it would suspend its business in Russia. In separate statements arriving within minutes of each other, Visa quoted “Russia’s provocative invasion of Ukraine and the unacceptable events we witnessed,” Mastercard said. To “the unprecedented nature of the current conflict and the uncertain economic environment”.
Ukrainian President Volodymyr Zelensky called on companies to suspend all operations in Russia during a video call with US lawmakers. Each receives about 4% of net income from businesses related to Russia. American Express continued on Sunday.
Some critics claim that the procedure is not sufficient. The two companies said that transactions initiated with cards issued in Russia will no longer work abroad, and cards issued outside Russia will not work with Russian merchants, ATMs and consumers in Russia. Those who have a locally issued card can still pay for goods and services there.
Most of the world’s largest automakers, including General Motors, Ford Motor, Volkswagen AG and Toyota, have announced that they will stop shipping to idle plants in Russia or the country within a week. Truck makers Volvo AB and Daimler Truck Holding AG have also ceased operations there.
The most defeated car maker, Renault SA, remains quiet.
Investors are worried that a French company dominates AvtoVAZ, a Soviet-era maker of Radas, and relies on Russia for about 12% of its earnings, leaving Renault one-third of its market value in two weeks. I lost the above. French government spokesman Gabriel Attal told French Information Radio Thursday.
Levi Strauss, a long-awaited black market product in the Soviet Union, has ceased commercial activity in Russia, which accounts for about 2% of sales. “It’s impossible to do business as usual,” the company said on Monday.
Samsung Electronics Co., a leading Russian smartphone distributor that accounts for more than 30% of the market, has stopped exporting all its products to the country. Samsung has announced that it will donate $ 6 million to humanitarian efforts in the region, including $ 1 million in consumer electronics. product.
Prior to the announcement, Ukraine’s Deputy Prime Minister and oversight of digital operations, Mykhailo Fedorov, posted a letter to Samsung’s Vice Chairman Han Jung-hee on his Twitter account, giving South Korean high-tech giants services and products to Russia. Prompted to temporarily stop supply. “We need your help. In 2022, modern technology is probably the best answer to tanks, multiple rocket launchers and missiles for residential areas, kindergartens and hospitals.” He is writing.
Microsoft accused Russia of “injustice, provocation and illegal intrusion” into Ukraine on Friday and said it would stop all new sales of its products and services in Russia. Apple Inc. Has stopped selling the iPhone and started limiting Apple Pay services and other popular products in Russia. Removed RTNews and SputnikNews applications from the international App Store. HP Inc, the largest supplier of PCs to Russia. Has stopped exporting to the country as well as Intel Corp.
Nike Inc. is one of several consumer goods companies citing logistics issues as a reason to stop selling in Russia. Spanish fashion retailer Inditex SA, which has 502 stores in Russia, including 86 Zara stores, has also temporarily closed all stores in Russia. “We cannot guarantee business continuity or transaction terms,” he said, and will stop online sales.
Danon SA Secretary-General Laurent Sacchi said the world’s largest yogurt maker will stop investing in Russia, but will continue to sell dairy products and baby food.
According to Le Figaro, Danon’s CEO Antoine de Saint-Afric was one of the CEOs and chairman of a major French company that met Emmanuel Macron on Friday. He consulted the government and the newspaper reported.
Netflix Inc. has closed its business in Russia and said it is unclear what will happen with existing accounts, but new customers will not be able to sign up.
Netflix has less than 1 million customers in Russia and operates in the country through a partnership with the National Media Group. The streaming giant has previously stated that it will not deliver the Russian news channels required by the country’s local language services. Suspended all projects and acquisitions from Russia, including four programs in production.
Walt Disney Co., Paramount Pictures, Sony Corp., AT & TInc. WarnerMedia and Comcast Corp. Hollywood studios such as Universal Pictures have also suspended or postponed the release of movies in Russia.
Meanwhile, other platforms, including TikTok, have suspended or closed their services due to Russia’s new “fake news” law aimed at silencing dissent and limiting information about Ukraine’s aggression. ..
In a series of tweets, TikTok said, “While considering the safety implications of this law, we have no choice but to suspend livestreaming to video services and new content. Employee and user safety remains a top priority. That’s it. “
Byte Dance Ltd based in China. The company, which is owned by the company, said its in-app messaging service would not be affected.
On Friday, the Russian government announced that it was blocking access to Facebook by Meta Platform Inc. as part of a crackdown. Hours after the announcement, Meta announced that it would suspend all ads in the country and stop selling ads to Russian companies.
Law and accounting
Baker McKenzie said last week that he was reviewing his business in Russia and would cut off relationships with several Russian customers in order to comply with sanctions. The Chicago-based company’s customers include Russia’s Ministry of Finance and VTB, Russia’s second-largest bank.
“We are reviewing all of the company’s Russian-related work,” London-based Linklaters said in a statement. Big Four accounting firms Pricewaterhouse Coopers LLP and KPMG LLP also said they would cut off ties with Russian companies on Sunday.
Last week, McKinsey & Company’s global managing partner Bob Sternfels condemned the aggression and said the company would not do business with Russian government agencies. McKinsey said Thursday that it would not open new customer operations in Russia and would suspend all customer service in the country after the remaining contracts expired, but the office remains open to support staff. ..
As more companies cut off their ties with Russia, there is growing criticism of banks and companies that are considered to be profiting from the war or not doing enough to punish Putin’s aggression. ..
Wall Street voice critic Elizabeth Warren said sanctions were “ weakened by some banks getting Russian corporate bonds and proposing that customers buy cheaper national assets. “It has been transformed.”
In a statement released late Friday, Warren announced market makers JPMorgan Chase and Company and Goldman Sachs Group Inc. following Bloomberg’s report that two banks were buying beaten bonds. I called. Or because they expect to find a ready buyer.
Analysts at JP Morgan also released a memo recommending investors increase their holdings of Russia-related debt in order to take advantage of the “recovery measures” resulting from the sale associated with the invasion of Ukraine.
“Giant Wall Street banks like JP Morgan and Goldman Sachs mean taking advantage of Russia’s invasion of Ukraine and weakening the sanctions imposed on Russian companies,” said Warren of the Massachusetts Democratic Party. But don’t miss the opportunity to get richer. “
Goldman Sachs and JP Morgan representatives declined to comment on Bloomberg’s report that they were buying Russian bonds.
According to Nikkei, the founder of Fast Retailing, which owns fashion giant Uniqlo, said it would never withdraw from Russia. “Russians also have the right to live.”
A representative of Fast Retailing in Tokyo did not respond to inquiries from Bloomberg News. As of February 28, the company operates 50 stores in Russia. Fast announced on March 4 that it would donate $ 10 million and 200,000 pieces of clothing to the United Nations. The High Commissioner for Refugees assists those fleeing Ukraine.