Economic sanctions always have collateral effects on companies in the countries that impose them. The rule will be verified with the very severe measures decided by the United States and the European Union (EU) in retaliation for the invasion of Ukraine by Russia. For France, it is time to assess the risk. The Minister of the Economy, Bruno Le Maire, exchanged, Thursday, February 24, with France Industry and major federations (banks, metallurgy, space aeronautics, agri-food, automobile, etc.). He was to meet in Paris on Friday, his European counterparts to measure the impact of the crisis on growth and discuss sanctions.
The French economy is “low exposure” to Russia, which is “a secondary economic partner”he recalled, saying nevertheless “ aware that these sanctions may have an impact on some companies”. “We will list the SMEs and VSEs that could be indirectly affected (…) to provide the support they may need”, announced the Mayor on Wednesday. In fact, its trade, hampered by the sanctions imposed since 2014 on Russia after its annexation of Crimea, has been reduced: it exports less than 7 billion euros there, or 1.3% of its exports; it imports less than 10 billion. Excluding energy, we temper at Bercy, Russia’s dependence on the EU is stronger than the reverse.
Still, in the two countries now at war, there is concern and uncertainty. Thirty-five CAC 40 multinationals are present in Russia, where there are 700 French subsidiaries and SMEs employing 200,000 Russian employees. In Ukraine, French groups are the largest foreign employer with 30,000 people in 160 companies. French companies with significant activities in Russia were the most penalized on Thursday by the fall of the Paris Stock Exchange.
Renault could also be weakened
The Westerners, having decided to attack first the financial sector, it is the banks which are the most exposed. Societe Generale in the lead, through its subsidiary Rosbank, with 550 branches, 5 million customers and 12,000 employees. Moreover, Russian debt remains “concentrated on three banks”, recalls the firm Oxford Economics: UniCredit (Italy), Société Générale (France) and Raiffeisen Bank (Austria). The risk is not systemic, but these two banks are exposed to Russian claims to the tune of $25 billion (22 billion euros), each out of a global total of $121 billion in claims, according to the Bank for Settlements. international (BIS).
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