Nearly 200 large foreign companies announced that they were suspending their work in Russia or leaving the country.
Among them are the technological enterprises of the energy sector, automotive, clothing, shoe and cosmetics retailers, as well as financial services.
However, foreign businesses won’t be able to withdraw their capital from Russia.
On March 1, a presidential decree took effect which practically blocks foreign investors from withdrawing Russian assets.
According to Finam’s Yaroslav Kabakov, many companies are freezing investment, yet will continue to function in Russia.
In his opinion, as a consequence, Russia’s GDP may slow down to negative 5% annually.
“The main obstacle for a rapid import replacement, as strange as it sounds, is the high integration of many Western companies into Russia’s economy, no one will just give up their business. The second reason is a sharp decrease in the sources of investment,” the expert said.
Western companies may pay a high price for leaving Russia, leading analyst of Mobile Research Group Eldar Murtazin says.
According to preliminary estimates, compensation to fired employees, bonuses to partners and other payments may cost Apple about $6 bln and Microsoft may spend on this $6.6 bln not to mention decreased profits and reduced investment in partnership projects.
Western investors in the energy sector, such as Uniper, announced that they were withdrawing from Russian assets.
According to Finam’s Natalya Malykh, this is not critical for the Russian market since their share can be bought out by Chinese investors.
While Western companies are suspending their activity, Russian ones hope to take advantage of the situation and increase their market share. For example, clothing manufacturers count on increased demand.
The owner of I Am Studio Oleg Voronin told Izvestia that this situation represents an opportunity for domestic business. According to him, people are interested in buying new things while Russian brands know how to produce quality products with a unique design.
Igor Bederov of T.Hunter noted that Linux-based products such as Ubuntu or the Russian AstraLinux may replace Windows, while several Russian and Chinese products may replace Microsoft Office.
The order portfolios of Russian software developers have grown five to six times over the past two weeks and are likely to increase many times over, Izvestia’s source, who is familiar with several company managers, is sure.
The transition to Russian software will not be easy for companies and the public sector – it will be necessary to retrain employees, reconfigure information systems. But it is possible, – the source of Izvestia believes.
As alternatives to Windows, the head of the department of information and analytical research at T.Hunter, Igor Bederov, named Linux-based products, in particular Ubuntu, the Russian AstraLinux .
As for office suites, instead of Office, you can use the Russian My Office, LibreOffice, Chinese WPS , Igor Bederov noted.
According to an employee of a retail chain, if Samsung and Apple leave the market completely, their niche will be filled by inexpensive Chinese smartphones.
He added that the same will happen with tablets and other electronics.
Deputy head of new car sales at Avilon Alexey Starikov told Izvestia that continued growing demand is expected for Chinese auto brands that are actively developing in Russia.
As for cars, we can expect that the demand for Chinese brands that are actively developing in the Russian Federation will continue to grow , Alexey Starikov, deputy head of new car sales at Avilon AG, told Izvestia.
Nevertheless, in the short term, the suspension of the activities of automakers and importers will negatively affect the market , the Russian Automobile Dealers Association (ROAD) noted.
The organization is already recording a shortage of machines and spare parts . There will be a redistribution in the Russian market – the share of those manufacturers who continue to work will increase, according to the ROAD.
Source: IZVESTIA