Nestle, Philip Morris and video gamemaker Sony have joined the list of multinationals stepping back from Russia as pressure mounts from consumers in the West to take a stand against the invasion of Ukraine.
Nestle, the world’s biggest packaged foods group, fell into line with rivals Procter & Gamble and Unilever in halting investment in Russia, and Mondelez International will scale back non-essential activities while helping maintain “continuity” of the Russian food supply.
Cigarette maker Philip Morris said it would scale down manufacturing, Imperial Brands suspended it, and Camel maker British American Tobacco said its business in Russia continued to operate, but it had suspended capital investment.
Sony, whose movie studio has already stopped releases in Russia, said its PlayStation gaming unit would stop shipments and operations in Russia. “Sony Interactive Entertainment joins the global community in calling for peace in Ukraine,” it said.
Some companies are taking similar action without calling out Russia. Many businesses face difficulty working in Russia due to sanctions and lack of shipping, as well as pressure from consumers and investors.
Heavy equipment maker Deere & Co, saying it was “deeply saddened by the significant escalation of events in Ukraine”, announced it had ended shipments to Russia two weeks ago, and subsequently to Belarus.
Miner Rio Tinto said it was working to maintain supplies of Russian fuel to its Mongolian copper mine.
“The reality is, Mongolia has two very big, powerful neighbours, so it’s quite important for us to maintain healthy, peaceful, balanced relationships,” said the head of Rio’s copper business, Bold Baatar, referring to Russia and China.
But pressure in the West is building, and hotel companies Hilton Worldwide Holdings and Hyatt Hotels Corp said they would suspend development in Russia.
Coca-Cola Co and McDonald’s Corp halted sales in Russia on Tuesday in symbolically potent gestures.
McDonald’s said the temporary closure of its 847 stores in the country would cost it $US50 million ($A68 million) a month.
Sportswear firm Adidas also quantified the cost of scaling back its operations, saying it would take a hit to sales of up to 250 million euros ($A380 million).
Yum Brands, parent of fried chicken giant KFC, said it was pausing investments in Russia, a market that helped it achieve record development last year.
Carlsberg said it was suspending Russian brewing of its namesake beer while keeping its Russian Baltika brand operating.
E-commerce company Shopify joined the crowd, saying it would suspend Russian operations and collect no fees from Ukrainian merchants, citing millions of Ukrainian refugees needing support.
In response to the exodus, Andrei Turchak, of the ruling United Russia party, warned that Moscow might nationalise idled foreign assets.
“We will take tough retaliatory measures, acting in accordance with the laws of war,” Turchak said.
Moscow has been hit by sweeping Western sanctions that have choked trade, led to the collapse of the rouble and further isolated the country.
Extracted from The West