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Business Insider
27-05-2025
- Business
- Business Insider
Putin said Russia needs to 'strangle' Western tech firms still operating in the country
Russian leader Vladimir Putin signaled punishment on Monday for Western tech firms still operating within his country's borders. "You just have to strangle them. I agree completely," Putin said at a meeting in the Kremlin with Russian business leaders. "I say it without any embarrassment, because they are trying to strangle us. We need to reciprocate. That's it," he said. Putin made the remark after Stanislav Yodkovsky, who runs a Russian company offering videoconferencing services, said at the meeting that some of his Western competitors still had services available in Russia in some capacity. "Slightly limit the work of services that have left Russia, such as Zoom and Microsoft," Yodkovsky urged. He told Putin that local analysts had assessed the international competition in the local market was costing Russian companies "billions." Responding to Yodkovsky, Putin said Russian companies and consumers who used Western services should give up their "bad habits." "No one was expelled from Russia, no one was interfered with," Putin said of the Western companies that left Russia in 2022. "We provided the most favorable conditions for them to operate here, in our market, and they are trying to strangle us. We need to respond in kind, act as a mirror," he added. Microsoft officially closed its office and operations in Russia amid the 2022 Western exodus brought on by Moscow's invasion of Ukraine. In March of that year, the firm said it had suspended all new sales in the country and was "stopping many aspects of our business in Russia in compliance with governmental sanctions decisions." However, it's unclear how widely Russian consumers still use the firm's services, such as its popular videoconferencing tool Teams. Zoom similarly banned its distributors in April 2022 from selling services to Russia's government and state-owned conglomerates. In October 2022, it stopped selling new licenses to Russian consumers. But the company was fined 115 million rubles in October 2023 by a Russian court for what a local judge said was operating in the country without a local office. Neither Zoom nor Microsoft responded to requests for comment sent outside regular business hours by Business Insider. Putin's comments on Monday come as the Kremlin has said that departed international firms hoping to re-enter the Russian market in the future wouldn't be welcomed so easily. "We are not waiting for anyone with open arms. There will be a price to pay for past decisions," Anton Alikhanov, the Russian industry and trade minister, said in February. Nearly 475 foreign companies have fully left the Russian market since the war began, per the Leave Russia database from the Kyiv School of Economics.
Business Insider
30-04-2025
- Business
- Business Insider
2 big companies aren't rushing to return to Russia
Two of the biggest brands to exit Russia after its invasion of Ukraine do not appear ready to stage a comeback. President Donald Trump has indicated that the US could reconcile with Russia, which could allow Western companies to reenter the market. That's spurred speculation in Russian media about which companies could come back and under what circumstances. In March, the Ukrainian advocacy group B4UKraine Coalition contacted several Western countries, including Coca-Cola and McDonald's. In correspondence with the group, executives from both companies indicated they plan to stay out of Russia. In the group's letter to McDonald's, B4Ukraine Coalition highlighted comments in local media from political analyst Vadim Siprov, who said in mid-February that McDonald's could return by year's end. McDonald's is sticking to the principles that guided its decision to exit Russia in 2022, the company said in its March response. The organization posted McDonald's letter online. In 2022, McDonald's evaluated five questions: whether it's legal to operate in the country, whether it has the freedom to run its business, whether its presence is helpful to its brand, whether staying aligns with its values, and whether it makes good business sense. "The principles behind these questions, which guided our decision to 'de-Arch' a major market and sell our portfolio of McDonald's restaurants, still apply today," wrote Jon Banner, the fast food giant's global chief impact officer. In 2022, "the answer to each of those questions was no," Banner wrote. Meanwhile, Coca-Cola said in a late March email reply to the Ukrainian group that "sanction regimes and other legal hurdles" stand in the way of any return to the Russian market. McDonald's and Coca-Cola did not respond to requests for comment from Business Insider. 'A price to pay for past decisions' Russia said in February that it is not in a hurry to receive Western companies that had left the country over its war in Ukraine. "We are not waiting for anyone with open arms. There will be a price to pay for past decisions," Anton Alikhanov, the Russian industry and trade minister, told reporters in February, according to the state news agency TASS. Three years into the war in Ukraine, nearly 475 foreign companies have left the Russian market completely, per the Leave Russia database from the Kyiv School of Economics. Those that have made a complete exit include McDonald's, Starbucks, Ikea, the British energy giant Shell, and the Japanese tire maker Bridgestone. Alikhanov also said Russia was prioritizing domestic brands instead of waiting for foreign brands to return. Analysts have said that businesses are likely to be cautious about returning to the country even if sanctions are lifted. Russia's wartime economy is facing multiple issues, including high inflation, currency volatility, and sky-high interest rates. Putin's ironclad reign also presents concerns about the rule of law and safety.
Yahoo
21-03-2025
- Business
- Yahoo
No Western companies have applied to return to the Russian market, a top official says
No Western companies have applied to return to Russia, a top Russian official said. He signaled tough negotiations for returning Western firms. Trump's Moscow talks have spurred speculation about a corporate return to Russia. No Western companies have applied to return to Russia, a top Russian official said on Thursday — a contrast against recent active speculation about a corporate return to the market. "No one has officially applied yet, only informally testing the waters so to say," said Dmitry Medvedev, the deputy chairman of Russia's Security Council, according to TASS state news agency. The Trump administration has been seeking a cease-fire deal with Moscow, spurring discussions about a return of Western businesses to Russia. Western brands "will be waiting for their management to give a signal," Medvedev said. Companies that left Russia include fast-food giant McDonald's and coffee chain Starbucks. Medvedev indicated it wouldn't be easy for the foreign companies — who he said left on their own accord — to return to Russia, as the country's businesses have filled their shoes. "Our companies have taken many niches by now, well done to them. New expertise, new production sites, and even whole sectors appearing amid sanctions have emerged. They fairly earned their place in the sun, and they are ours, Russian," Medvedev said on Thursday. Medvedev's comments echo those made by Anton Alikhanov, the Russian industry and trade minister, who said last month that Russia was "not waiting for anyone with open arms" and that there would be "a price to pay for past decisions." On Tuesday, Russian President Vladimir Putin doubled down on his officials' stance, per TASS. "To prevent cases when the owners sold their business in Russia at a bargain price essentially left it to its fate, and now they want to buy the asset back for the same peanuts. It shouldn't be like that, that's not the way it works," Putin said. "The market situation has changed, the companies have become stronger, increased their capitalization and are valued differently." More than three years into the war in Ukraine, 483 foreign companies have left the Russian market completely, according to the Leave Russia database from the Kyiv School of Economics. The exit of foreign businesses created winners at home in Russia, some of whom picked up assets at fire sale prices. They would likely need to be compensated to give up their businesses. "Freely allowing foreign companies back in is going to diminish their profit streams and make life a lot more competitive, so if that is going to happen, Russia wants some kind of compensation for liberalizing its market," said David Szakonyi, a specialist in Russia's political economy at George Washington University, told Business Insider last month. Avtovaz, the former Russian partner of Renault, said last month that the French carmaker would need to pay about $1.3 billion if it wishes to return after the war. Despite the lure of the large Russian market, analysts have recently said that businesses are likely to be cautious about a return to the country, even if sanctions are lifted. Russia's wartime economy is facing multiple issues, including high inflation, currency volatility, and sky-high interest rates. Putin's ironclad reign also presents concerns about the rule of law and safety. Investors are likely to remain cautious after corporate nationalization and asset seizures in the past few years that redistributed international corporate wealth to the Russian state and oligarchs. Read the original article on Business Insider
