Companies from ?unfriendly? countries reportedly cannot withdraw their winnings
Multinational companies from “unfriendly” countries made big profits in Russia last year despite sanctions their home countries imposed on Moscow, the Financial Times reported on Monday, citing calculations by the Kiev School of Economics (KSE).
The KSE calculations are based on sources such as the Russian Business Register, news reports and company statements.
Major Western brands that decided to continue operating in the country recorded over $18 billion in Russian profits in 2022, out of the $20 billion reported by all foreign companies operating in the country, the data showed.
“The numbers may have increased significantly since then, although it is not possible to assess exactly how much because most international companies operating in Russia only disclose their local results annually,” FT quoted KSE Deputy Development Director Andrey Onopriyenko, who compiled the data, as proverbs.
US-based companies reportedly made the largest total profit at $4.9 billion, followed by German companies at $2.4 billion, Austrian companies at roughly $2 billion and Swiss companies at around $1 billion.
Austria-based Raiffeisen Bank brought in the biggest Russia revenue among Western companies at about $2 billion in 2022, the data showed. This was followed by US tobacco giant Philip Morris with $775 million and beverage giant PepsiCo with $718 million. Swedish truck manufacturer Scania earned $621 million in Russia in 2022, making it the biggest earner among companies that have since exited the Russian market.
But most Western companies reportedly do not have access to the profits they made in Russia. Soon after the conflict in Ukraine started, Moscow compiled a list of countries that had imposed sanctions on Russia and considered these nations “unfriendly”. They include, among others, the United States, Great Britain, EU states, Canada, Japan. All transactions with companies from these countries must be approved by the Russian government, and the local earnings of these companies are subject to a dividend ban. Dividends can still be approved if a special permit is granted by the Russian authorities, but according to the report, few such permits have been issued so far.
Western companies can also get permission from a government commission to sell their business in Russia. However, such sales are usually made at a significant discount, and buyers of Western assets must pay a mandatory contribution to the Russian budget.
When asked to comment on the situation, Raiffeisen told the news agency that it “does not have access” to its profits in the country. However, the lender has not written off the value of its Russian operations. Philip Morris, PepsiCo and Scania did not respond to requests for comment.
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(RT.com)
Source: sn.dk