Wrapup 1: Rio first big miner to cut Russia ties; Sony, Nintendo halt console sales
10/03/2022 07:25
By Praveen Menon and Sam Nussey
March 10 (Reuters) - Rio Tinto became the first major mining
company to cut ties with Russian businesses and Japan's Sony and
Nintendo suspended deliveries of their gaming consoles, joining
a global corporate exodus from Russia over its invasion of
Ukraine.
Japanese construction machinery supplier Hitachi 6501.T
said it would stop exports and cease most operations in Russia
except for vital electrical power facilities, following similar
exits by American industrial companies Caterpillar CAT.N , 3M
Co MMM.N , Deere DE.N and Honeywell HON.O . urn:newsml:reuters.com:*:nL2N2VD08Q
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"We took multiple factors including the supply chain
situation into account," a spokesperson for Hitachi said,
echoing a statement from Caterpillar.
The Nikkei newspaper reported Hitachi had suspended
operations in Russia following a request from the Ukrainian
government to do so.
Sony 6758.T , whose movie studio had already stopped
releases in Russia, suspended the launch of racing game "Gran
Turismo 7". Rival Nintendo 7974.T said it delayed the global
release of "Advance Wars 1+2: Re-Boot Camp", a turn-based
strategy game with a military theme. urn:newsml:reuters.com:*:nL2N2VD0BA
Food companies Nestle NESN.S , Mondelez MDLZ.O , Procter &
Gamble PG.N and Unilever ULVR.L halted investment in Russia,
but said they would continue providing essentials.
Coke KO.N and McDonald's MCD.N have halted sales in
Russia, KFC owner Yum Brands YUM.N has paused investments, and
hoteliers Hilton HLT.N and Hyatt H.N said they would suspend
development.
Japan's Shiseido 4911.T suspended exports of its cosmetics
to Russia from Europe as well as advertising and promotions.
While some companies such as Ford F.N and Apple AAPL.O
have condemned Russia's invasion of Ukraine, others including
Japanese automaker Toyota 7203.T have taken a more neutral
stance, blaming a halt in production in Russia on logistical
hurdles. urn:newsml:reuters.com:*:nL1N2V50NI
Sweeping Western sanctions have isolated Russia even as
shippers have suspended routes, and European Union leaders plan
to phase out buying Russian energy in a bid to be less dependent
on Russia after it invaded Ukraine. urn:newsml:reuters.com:*:nL2N2VD01Y
The war, which entered its third week on Thursday, has
killed thousands of people and rendered more than two million
refugees. urn:newsml:reuters.com:*:nL2N2VD079
It has decimated the rouble, roiled stock markets and prices
of oil and other commodities have skyrocketed, adding to global
inflation that was surging even before the conflict began.
PAY IN ROUBLES
Russia plans to order local airlines to pay for leased
aircraft in roubles and bar them from returning planes to
foreign companies if the latter cancel the lease, according to a
draft law published on Thursday. urn:newsml:reuters.com:*:nL5N2VD0YE
Moscow, which calls the war a "special military operation,"
has warned it might nationalise idled foreign assets in
retaliation against Western sanctions.
Rio Tinto RIO.L RIO.AX , which owns an 80% stake in a
joint venture with Russian aluminium producer Rusal RUAL.MM ,
said it was "in the process of terminating all commercial
relationships it has with any Russian business." urn:newsml:reuters.com:*:nL2N2VD01C
Earlier, a top executive from the Anglo-Australian firm said
the company was looking for alternative fuel sources for its
Mongolian copper operations at Oyu Tolgoi, but did not believe
it could stop buying from Russia altogether. urn:newsml:reuters.com:*:nL2N2VC28V
It was not immediately clear if Rio would continue to buy
Russian fuel through non-Russian third parties.
Rio rival BHP BHP.AX , which had said earlier this week
that the war was having a "dramatic impact" on its business in
terms of commodity prices, did not immediately comment on
Thursday on whether it had any business links with Russian firms
and would consider terminating them.
Italian energy group Eni ENI.MI suspended the purchase of
oil from Russia and said it was watching developments closely
with regards to gas procurement. urn:newsml:reuters.com:*:nL5N2VC3YG
Eni, which had already frozen joint ventures with Russian
oil group Rosneft ROSN.MM following sanctions imposed in 2014,
also has long-term take-or-pay gas contracts with Gazprom
GAZP.MM .
On Tuesday, the United States banned Russian oil imports.
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Western sanctions have also targeted banks and billionaires,
with the European Commission preparing new sanctions against
additional Russian oligarchs and politicians, and three
Belarusian banks, Reuters reported.
Citigroup C.N said it is operating its Russian consumer
business on a more limited basis while sticking with its plans
to divest the franchise. urn:newsml:reuters.com:*:nL2N2VC3AW
Banks are likely to find it harder than many other companies
to extricate themselves from Russia, experts predict, because it
is hard to walk away from lending commitments and other types of
financial claims. urn:newsml:reuters.com:*:nL2N2V63FF
(Reporting by Praveen Menon in Wellington, Sam Nussey in Tokyo,
and other Reuters bureaux; Writing by Sayantani Ghosh; editing
by Richard Pullin)
((sayantani.ghosh@thomsonreuters.com;))