Putin Opens the Door to Nationalizing Western Businesses in Response to Crippling Sanctions

Russian President Vladimir Putin on Thursday opened the door to nationalizing the assets of western businesses pulling out of Russia in response to sanctions, The New York Times reports.

Russia’s currency has plummeted as a result of sanctions from the west and the country is now in danger of defaulting on its best. Putin on Thursday accused the west of using his invasion of Ukraine as a pretext to attack Russia’s economy.

“I have no doubt that these sanctions would have been implemented no matter what,” he said. “Just as we overcame these difficulties in years past, we will overcome them now, too.”

The outflow of western companies could also hurt the country’s ability to import goods and services.

Putin said in a televised meeting that companies like McDonald’s and Ikea, who have shuttered hundreds of stores, should be put under “external management” and transferred to “those who want to work.”

Senior Kremlin official Dmitri Medvedev said the country may respond by seizing the companies’ assets and “their possible nationalization.”

Which companies?

A report from a Russian newspaper listed nearly 60 companies, including McDonald’s, Apple, IKEA, Microsoft, IBM, and Porsche.

“All of these businesses have offices, buildings, factories, storefronts in Russia” that could be “forcibly taken by the state,” according to BBC News.

The government has also told aviation giant Aeroflot not to pay western companies for the leases on their planes. In a separate move, it announced that patent protections would no longer be enforced for anyone affiliated with its list of “unfriendly” countries.

White House warns:

White House press secretary Jen Psaki said the administration is aware of reports that Russia “may be considering seizing the assets of U.S. and international companies that have announced plans to suspend operations in Russia or to withdraw from the Russian market.”

“Any lawless decision by Russia to seize the assets of these companies will ultimately result in even more economic pain for Russia. It will compound the clear message to the global business community that Russia is not a safe place to invest and do business,” Psaki warned, adding that the country could also face “legal claims from companies whose property is seized.”

 

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