Business exodus looms the threat of a nationalization of foreign factories in Russia

Coca-Cola and McDonald’s are among the companies that recently suspended sales in Russia, where a senior member of the ruling party has warned that foreign companies that close could see their operations nationalized.

PepsiCo and starbucks they also joined the dozens of multinational companies closing shops, factories or abandoning investments to comply with sanctions or due to supply problems.

The irregular supply contributes to the suspension of container routes of the three main giants of world maritime transport.

Heinekenthe world’s second-largest brewer, has halted production and sales in Russia and said it was evaluating options for its operations there.

Yum Brands Inc.matrix of the fried chicken giant KFCsaid it was pausing investments in Russia, a market that helped it make a record breakthrough last year.

law of war

In response to the wave of companies withdrawing, Andrey Turchaksecretary of the general council of the ruling United Russia party, warned that Moscow could nationalize idle foreign assets.

“United Russia proposes to nationalize the production plants of companies that announce their departure and the closure of production in Russia during the special operation in UkraineTurchak wrote in a statement posted on the party’s website Monday night.

The statement named private Finnish food companies Fazer, Valio and Paulig as the latest to announce closures.

“We will take harsh retaliatory measures, acting in accordance with the laws of war“, said turkak.

sanctions

Moscow, which describes its invasion of Ukraine as “special military operation”, has also been hit by numerous Western sanctions that have stifled trade, caused the ruble to crash and further isolated the country.

Banks and billionaires have also been hit, with the European Commission preparing new sanctions against other Russian oligarchs and politicians and three Belarusian banks, according to Reuters.

Although the war in Ukraine and the sanctions have pushed up the prices of the raw materials it exports RussiaLike oil, natural gas, and titanium, sanctions have largely prevented Moscow from taking advantage of high prices.

On Tuesday, the United States banned imports of Russian oil.

US oilfield services company Schlumberger, which derives about 5% of its revenue from Russiasaid the ongoing conflict would likely hurt its results this quarter.

The global commodity trader Trafigura Group secured a $1.2 billion revolving line of credit from banks to help cope with rising energy and commodity prices.

the norwegian Yaraa major fertilizer maker, said on Wednesday it would cut ammonia and urea production in Italy and France due to rising gas prices.