Western Companies Pulling Out Of Russia As Long As It Doesn’t Hurt Their Bottom Line
Hordes of western businesses have left Russia since the country’s invasion of Ukraine, often citing humanitarian as the reason but many of them have maintained relationships with China.
Following Russia’s invasion of Ukraine, American and European companies, particularly in the technology and entertainment sectors, announced they would be restricting service and sales in the country, with many suspending operations altogether. However, many of these companies operate in China and have been linked to human rights abuses and forced labor of the Uyghur Muslim population.
Apple announced Tuesday it would no longer sell its products in Russia and that certain services would be suspended, expressing solidarity with “all of the people who are suffering” from violence.
Apple manufactures many of its devices in Russia and sells to the Chinese market. It has also been suggested that Apple is complicit in the continued repression of Uyghurs.
The company has previously lobbied on legislation aimed at curbing the use of forced labor in American supply chains.
Apple reported $25 billion in revenue from the Greater China region in the first quarter of 2022, nearly as much as the company took in for the entirety of Europe, according to financial filings. The Chinese market was responsible for roughly 20% of Apple’s global revenue.
By comparison, Apple would lose roughly 1% of its global revenue by leaving Russia entirely.
The company has previously condemned the use of forced labor and claimed it does not use it in its supply chains.
Cloud computing company Oracle, announced it’s leaving Russia Wednesday, citing “support of both the elected government of Ukraine and for the people of Ukraine.”
Oracle maintains a presence in China, employing “hundreds of developers” at “three centers in Oracle China” and conducting research and development in the Shenzhen economic zone.
The company has also been accused of aiding human rights abuses in China.
The company denied those claims adding that it had been reducing its presence in China over the past few years.
U.S. clothing company Nike announced it was closing its stores in Russia. The company which manufactures many of its products in China, has also been linked to forced labor and lobbied on bills that seek to excise Xinjiang slave labor from U.S. supply chains.
The companies’ inconsistencies in their stance toward China and Russia have many lawmakers such as Florida Republican Sen. Marco Rubio and Indiana Republican Rep. Jim Banks, questioning their sincerity.
“Corporations like Apple and Nike only seem to care about ‘human rights when it doesn’t seriously threaten their profit margin,” Banks said. “These companies lobbied in favor of Uyghur slave labor. Recent PR stunts can’t erase their years of complicity in Communist China’s genocide.”
Banks, who chairs the Republican Study Committee, led the Countering Communist China Act which restricts how certain American companies can do business with the Chinese state.
“China is Russia times a thousand. Their economy is way bigger, their military might is superior at this point,” Rubio said.
“Let’s not forget there are American companies and their CEOs who are basically lobbyists for the Chinese government’s position on a range of issues because they’re desperate for market share over there because they’ve got factories and production over there,” Rubio added.
European companies with strong ties to China have also exited Russia, with German industrial conglomerate Siemens announcing it would be halting business in Russia Wednesday claiming to “fully support all sanctions” against the country.
Siemens has invested heavily in China, claiming the country is now their “second-largest overseas market.”
Disney said Monday it was placing a hold on all new theatrical releases in Russia, citing “the unprovoked invasion of Ukraine and the tragic humanitarian crisis.”
“We will make future business decisions based on the evolving situation,” Disney said. “In the meantime, given the scale of the emerging refugee crises, we are working with our NGO partners to provide urgent aid and other humanitarian assistance to refugees.”
Disney has collaborated with China on several projects, most notably on a $5.5 billion investment to build the Shanghai Disney Resort and produce “Mulan.”
American automakers Ford and GM both announced they were suspending operations in Russia Tuesday, with both companies citing a number of reasons for the decision.
“As part of the global community, Ford is deeply concerned about the invasion of Ukraine and the resultant threats to peace and stability,” Ford said in a statement. “The situation has compelled us to reassess our operations in Russia.”