• 23/06/2024 02:08

Western companies earned 40% more in Russia last year than before the war – media

Almost half of the income in 2023 came from the Russian assets of three global giants – the French oil and gas company TotalEnergies, the British energy concern BP and the Austrian bank Raiffeisen.

Western companies earned up to wars, ‒ media

Western companies earned 1.3 trillion rubles in Russia last year. This is 40% more than before the full-scale war. This is stated in the material of novayagazeta.eu.

“Western business, in the third year of Russia’s full-scale invasion of Ukraine, continues to create the appearance of “leaving” the Russian market, but in fact it is quite successfully making money in the aggressor country,” – notes the publication.

In 2023, the total net profit of the 100 largest foreign companies in Russia increased to 1.3 trillion rubles. This is 1.4 times or 383 billion rubles more compared to the last pre-war year 2021.

Most of the income of Western companies remaining in Russia has been frozen by the Kremlin, which has prohibited foreign investors from withdrawing profits and dividends. This money became additional fuel for the growing Russian economy during the war.

For example, this is how Russian banks make money: for them, the profits of foreign companies have become an additional source of assets that can be invested in financial instruments and receive income. But the main beneficiary of the work of foreign businesses is the Russian budget: 100 largest companies transferred more than 400 billion rubles in income taxes to it in 2023. This is about 1.5% of last year's federal budget revenues, which finances the war.

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“Of our top 100 foreign companies, 85% of the total profit at the end of 2023, or 1.1 trillion rubles, comes from the 20 largest companies. For our part, almost half of this amount came from the Russian assets of three global giants – TotalEnergies, BP and Raiffeisen Bank,” the publication adds.

The newspaper adds that the “unfriendly” business that did not leave Russia not only continues to earn money: its income grows all the time while the war is going on. In 2023, they increased by 4% compared to 2022, and in the year the war began – one and a half times compared to 2021.

Of the largest companies, the Hungarian OTP Bank made the strongest breakthrough . Contrary to his promises, he is not parting with Russia and has increased his net profit by approximately 200 times, from 133 million rubles in 2022 to almost 25 billion rubles in 2023. The bank explained this by a significant increase in income in retail lending and transaction business. The profit of the Russian business of the Polish packaging manufacturer Can-Pack has increased fivefold.

Along with the increase in Rosneft's profits (due to rising oil production and prices), the share of profits attributable to its shareholder, the Austrian British energy concern BP, also increased – from 170 billion to 250 billion rubles. The share that Shell could have received from its participation in the Sakhalin-2 project had also more than doubled, from 37 billion to 87 billion rubles, if its stake had not been actually expropriated by the Russian authorities. Two other participants in this project, Mitsui and Mitsubishi, also doubled their potential profits.

The American producer of vegetable oils and food ingredients Cargill and the American pharmaceutical manufacturer Johnson & Johnson, as well as the German energy concern Uniper – however, the latter’s assets in Russia were transferred to external management last year.

The group of companies adhering to the “wait it out silently” strategy includes 43 companies that “quietly” earned 400 billion rubles in 2023 – slightly less than in the first year of the war, when they received a total net profit of 415 billion rubles. Among them, for example, Mitsui and Mitsubishi, which earned 39 and 31 billion rubles respectively last year.

Another example from this group is the French concern TotalEnergies< /b >, who has never spoken about plans to exit Russia, where he owns almost a fifth of the largest private gas producer NOVATEK and shares in the NOVATEK-controlled gas plants Yamal LNG (20%) and Arctic LNG 2 (10% ). Concert not only owns, but exports LNG to Europe from the Yamal project, from which it earns large profits. And only after the United States imposed sanctions against Arctic LNG 2 (it is now operating at only a third of its capacity), TotalEnergies was forced to declare force majeure and refuse to purchase gas from this plant.

To the group of those who announced the cessation of work, but continued to increase profits in Russia, the publication included 37 companies. They turned out to be the most successful: in 2023, they earned a total of almost 760 billion rubles in Russia (682 billion rubles a year earlier). The largest representatives of this group are BP Concern and Raiffeisen.

  • In March, Reuters wrote that the corporate exit from Russia after its invasion of Ukraine in 2022 cost foreign companies more than $107 billion. This amount includes write-offs and loss of income. About 1,000 companies have exited the Russian market, but hundreds, including French retailer Auchan and Benetton, are still operating or have suspended business.

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