Japan's Uniqlo Pivots To Get Out Of Russia As Britain Strikes At Oligarchs

March 10 – Japanese brands Uniqlo and Japan Tobacco have turned sharply and said they are stopping business in Russia, joining the corporate crowd on Thursday avoiding Moscow, and the UK has tightened sanctions on oligarchs, including Chelsea Football Club owner Roman Abramovich.

Investment bank Goldman Sachs (GS.N) became the first U.S. bank to leave Russia, and global grain trader Bunge (BG.N) said it was suspending new exports from Russia while still processing oilseeds for the domestic market. Read more.

Russian President Vladimir Putin has said his country will become stronger and more independent of Western sanctions, which he says are inevitable. Corporate condemnation of Russia’s attack on Ukraine is spreading, but Putin, who calls the war a special military operation, said he had no choice.

Discontent is also mounting among Putin’s personal allies as Abramovich and six others, including Igor Sechin, CEO of the Russian energy giant Rosneft (ROSN.MM), have become the most prominent oligarchs sanctioned by Britain since the invasion.

This action effectively puts Chelsea under the control of the UK government, stopping all sales and stopping the sale of new tickets or merchandise. More

The UK action came after the first major mining company, Rio Tinto (RIO.L) (RIO.AX), said it was cutting all ties with Russian operations, including fuel and other supplies for its Mongolian copper operations in Oyu Tolgoi. where possible, and the use of an alumina refinery in Ireland. More

Japanese companies Sony and Nintendo have suspended the supply of their game consoles; The music divisions of Sony and Warner Music Group (WMG.O) also ceased operations in Russia.

MANAGERS STEP BACK

Large fast food, beverage and consumer goods companies, led by McDonalds and Coca-Cola, have pulled out of Russia due to pressure from Western customers.

Hotelier Marriott International (MAR.O) has closed its Moscow office and, along with Hilton (HLT.N) and Hyatt (HN), has suspended construction.

The exodus of Japanese companies was gaining momentum, and many described the solutions from a practical point of view.

The owner of Uniqlo Fast Retailing (9983.T) told Japanese media that the company will continue to operate its 50 stores in Russia because “clothing is a life necessity”, but on Thursday the company said it could not continue business in Russia due to “a number of difficulties.”

Japan Tobacco, which controls about a third of Russia’s tobacco market, said its subsidiary will stop investing, marketing and launching heated tobacco products. More

Japan’s Shiseido (4911.T) has suspended exports of its cosmetics to Russia from Europe, as well as advertising and promotions, and Mitsubishi Electric said it would stop exports to Russia, where operations were in a “difficult situation.”

Japanese construction equipment supplier Hitachi said it would halt exports and cease most operations in Russia, with the exception of vital electric power facilities, following similar exits by U.S. industrial companies Caterpillar (CAT.N), 3M Co (MMM.N), Deere (DE.N). ). ) and Honeywell (HON.O).

Shoppers line up at a Uniqlo store in Moscow, Russia, March 10, 2022. REUTERS/Maxim Shemetov

“We took into account many factors, including the supply chain situation,” a Hitachi spokesman said, echoing Caterpillar’s statement.

While some companies, such as Ford (FN) and Apple (AAPL.O), condemned Russia’s invasion of Ukraine, others, including Japanese automaker Toyota (7203.T), took a more neutral stance, blaming the shutdown on Russia in logistical obstacles. . More

Swiss bank Credit Suisse (CSGN.S) reported about $900 million in credit exposure to Russia, including lending to wealthy clients, following disclosures by Italy’s UniCredit (CRDI.MI) and France’s BNP Paribas (BNPP.PA). More

Suzuki’s Hungarian plant (7269.T) has suspended car exports to Russia and Ukraine, about 10,000 cars a year, one of the first signs of conflict affecting the region’s economy as a whole. More

Widespread Western sanctions have isolated Russia, while shippers have suspended routes and European Union leaders plan to phase out Russian energy purchases to become less dependent on the country. More

The war, which began on Thursday for the third week, has claimed the lives of thousands of people and turned more than two million refugees. More

It destroyed the Russian ruble, roiled stock markets, and skyrocketed oil and other commodity prices, exacerbating global inflation that had been rising even before the conflict began.

The YouTube and Google Play store of Alphabet Inc (GOOGL.O) is suspending all payment services in Russia, including subscriptions, as sanctions begin to create problems for banks. More

They had previously stopped selling online ads in Russia. More

PAYMENT IN RUBLES

Russia plans to oblige local airlines to pay for leased planes in rubles and ban them from returning planes to foreign companies if the latter cancel the lease, according to a bill published on Thursday. More

Lessor BOC Aviation (2588.HK) said it has 18 aircraft worth $935 million leased to Russian airlines that could be affected by sanctions and cancellation of insurance policies. More

Moscow, which calls the war a “special military operation,” has warned it may nationalize dormant foreign assets in response to Western sanctions.

Rio Tinto, which owns an 80% stake in a joint venture with Russian aluminum producer Rusal (RUAL.MM), said it was “in the process of terminating all commercial relationships it had with any Russian business.” More

Italian energy group Eni has suspended oil purchases from Russia and said it is closely monitoring developments regarding gas purchases. More

Reporting by Michael Holden in London, Niket Nishant in Bangalore, Matt Skuffham and Sinead Cruz in New York, Pravin Menon in Wellington, Sam Nussey, Rocky Swift, Tim Kelly and Mariko Katsumura in Tokyo, Brenna Hughes Negaiwi in Zurich, Paresh Dave in Auckland , Don Chmielewski in Los Angeles, Karl Plum in Chicago and other Reuters bureaus; Writing by Sayantani Ghosh, Paul Sandle and Peter Henderson; Editing by Susan Fenton and Nick Zeminsky

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