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Companies from Europe and G7 countries have not left Russia en masse

Only 8.5% of companies in the European Union and G7 countries have left Russia, according to a Swiss university study which calls into question “the discourse on a vast exodus” businesses since the invasion of Ukraine.

Before the start of the conflict in February, 2,405 subsidiaries belonging to 1,404 companies from the European Union and G7 countries were active in Russia, identified professors Simon Evenett of the University of St. Gallen and Niccolò Pisani of the ‘IMD Lausanne, a prestigious business management institute.

At the end of November, nine months after the invasion of Ukraine, less than 9% of the panel studied had already sold at least one Russian subsidiary, the departures mainly concerning American companies, rather than European or Japanese companies, according to their work.

Several factors can explain why companies have not left Russia. Their activity may, for example, not fall under the sanctions. Others may not want to disengage due to usefulness “societal” of their products, list the authors of the study, citing essential drugs as an example. Some may also not have found a buyer at a sufficient price while others, even when they have found a buyer, come up against obstacles that the Russian government has been able to put in place. “to hinder” Where “delay the transfer”and prevent the repatriation of the proceeds of the sale.

But if the number of Western companies withdrawing “does not increase significantly” in a year or two, “the willingness or ability of many Western companies to divest from jurisdictions that their governments view as geopolitical rivals could be questioned”they say.

According to their research, one hundred and twenty Western companies had left Russia by the end of November. Among those who are still active there, 19.5% are German, 12.4% are American and 7% Japanese.

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