As Moscow and Washington discuss how to end the war in Ukraine, one of the many questions on investors’ minds is whether the corporate exodus from Russia in opposition to the February 2022 invasion of its neighbour may be reversed.
Reuters
As long as broad Western sanctions on Russia remain in place, that looks unlikely, but should U.S. President Donald Trump‘s administration seek to ease restrictions, it could open the door for some companies to return to what was once a high-growth market.
More than a thousand companies from McDonald’s to Mercedes-Benz have left Russia in the last three years by selling, handing the keys to existing managers or abandoning assets. Others like Danone and Carlsberg had their assets seized and a sale forced through.
Western companies have acknowledged losses totalling $107 billion in writedowns and lost revenue, according to a Reuters analysis in March 2024. Kirill Dmitriev, head of the Russian Direct Investment Fund, says U.S. companies have lost $324 billion by leaving Russia. Companies such as McDonald’s, Renault and Henkel agreed buyback options when exiting.
France’s Renault sold its majority stake in Russian carmaker Avtovaz in May 2022 for reportedly just one rouble, but with a six-year option to buy it back.
Some food and healthcare companies, including Procter & Gamble, PepsiCo and Mondelez, say they stayed on humanitarian grounds to continue supplying Russians with basic goods.
After the highest-level U.S.-Russian meeting since the Ukraine war began this week, Dmitriev said, without giving further details, that he expects a number of U.S. companies to return as early as the second quarter.
The most likely to return are those operating outside sanctions, such as retailers and food producers, rather than those in sectors such as energy and finance.
Dmitriev said he believed U.S. oil majors that had been successful in Russia would “at some point” return.
Senior lawmaker Anatoly Aksakov this week said he thought Visa and Mastercard would soon restore payment services. The two companies said their Russia suspensions remained in place.
Hundreds of Western companies including Carlsberg and Unilever issued statements condemning Russia’s aggression against Ukraine in the days and weeks after the invasion, framing their exit from the country or suspension of operations in moral terms.
Should a deal be reached that rewards Russia with Ukrainian territory, companies that have criticised Moscow risk reputational damage by returning.
Companies involved in supplying goods that have both civilian and military applications are bound by Western restrictions. Boeing and Airbus, for example, halted the supply of planes and spare parts. Other examples include semiconductors, telecoms equipment and electronics.
Speculation is rife on whether the U.S.-Russia talks could yield a softening of sanctions, but no concrete proposals have yet been made. Meanwhile, the European Union on Wednesday agreed a 16th package of anti-Russia sanctions, including a ban on primary aluminium imports.
Sanctions prohibit providing Russia with financial or energy-related services and Russian officials’ statements that they expect Western companies to return look for now like wishful thinking.
Some of the world’s most popular brands from Starbucks to IKEA and Levi’s have been replaced by Russian imitations. The more than 800 McDonald’s restaurants in Russia now operate under the brand Vkusno & tochka (Tasty & that’s it), owned by Alexander Govor and run in a similar fashion.
Starbucks sold its business to restaurateur Anton Pinskiy and rapper Timati, and is now known as Stars Coffee. Recapturing the market may be particularly hard for carmakers, as Chinese competitors have established a more than 50% market share, up from less than 10% three years ago.
It is not clear how willing Russia would be to support the return of European carmakers at the expense of Chinese ones, especially given the “no limits partnership” between Moscow and Beijing as trade between the two nuclear powers ballooned.
Moscow has long promised to retaliate for what it views as the theft of Russian assets abroad and has seized companies in Russia through presidential decrees and the courts.
Russia currently controls a handful of Western companies through the guise of “temporary management” and is this year quickening the pace of asset seizures of companies with foreign ownership links.
Most companies exiting Russia were forced to sell at huge discounts. Convincing investors to dip their toes back into the Russian market may take time.
On Friday, guests at a millinery in central London tried on hats of various shapes and sizes. Some leant in to smell a chocolate design, while others admired one infused with the scent of autumn.
A tempered chocolate hat on display as milliner Stephen Jones showcases his Autumn/Winter 2025-2026 collection at his Covent Garden shop during London Fashion Week, 21 February 2025. – Photo credit: AFP
Legendary British milliner Stephen Jones brought sensory experiences to his Autumn/Winter 2025 presentation at London Fashion Week, showcasing hats crafted from satin, tartan, crêpe, and even glass. “I was thinking about how people connected through hats, and so it’s about sight, and taste, and touch,” Jones, who also designs hats for Dior, told AFP at his studio in Covent Garden.
Feathers floated atop a delicate fascinator, icy beads dangled down from another headband, and Jones described a black satin flat cap with white piping as “assured” and “fun.”
“What is fashion about? Is fashion a uniform? Is fashion self-expression? Can fashion be fun? So that’s why this collection came about,” Jones said.
In the background, one guest tried on a hat with gauzy petals piled high, exclaiming, “It’s so strange; when I take the hat off, I feel naked.” The centre of attraction was a Willy Wonka-esque top hat made of chocolate with a bite-size hole in its crown, which Jones crafted in collaboration with Paris-based pâtisserie Jana Lai.
Jones has already received an order for the hat from a “lady who wants to wear it for her birthday party” and said the confectionary head covering can be worn by “anyone.”
“Not somewhere too hot, though”, he mused.
Celebrating life
From plush berets for Princess Diana to towering headdresses strutted down Dior runways, Jones’s hats have served as the crowning glory of celebrities and designers for over four decades.
His work is currently on display in a retrospective at Paris’s Palais Galliera called “Stephen Jones, Chapeaux d’Artiste”, which brings together some 170 hats spanning his career.
Jones, 67, was born “near Liverpool, in the middle of nowhere”.
“So, for me, Paris was always such an exciting place,” said Jones, who divides his time between London and Paris.
“Paris has always influenced my work,” he added, a customary brown beret balancing on his head.
Jones crafted his first hat when he was a student at London’s Central Saint Martins out of a cereal box and scraps from his sister’s blouse. That sense of whimsy and innovation never really went away.
“Everything else can be super serious, but fashion and hats need to be about celebrating life,” he said. “Especially at the moment.” For the millinery guru, participating in fashion week during a time of global political uncertainty was “strange.” “But that’s what fashion does. At least you can control how you get dressed in the morning.”
“Hats are so popular because they’re like a talisman of something. It’s a talisman of hope,” said Jones. “People wear jackets and tailoring and shoes… But to show your individuality, maybe a hat is a very good way of doing that.”
Despite dressing a roster of fashion royalty, Jones said he still has not made a hat for Britain’s Queen Camilla. “The Queen hasn’t worn my hats yet. Maybe one day I’ll make a hat (for her),” said Jones.
After 45 years of presenting collections, how does he keep pulling ideas out of his hat?
“I guess that’s my character. I live my life and put it into a hat.”
There’s no such thing as consistency when it comes to consumer confidence, at the moment at least, as trying to read consumer emotions in February is a little tough.
Photo: Pexels
GfK has its long-running Consumer Confidence Index increasing two points to -20 this month and its other measures to gauge sentiment were also all up on January.
This is in stark contrast to yesterday’s (20 February) data from the British Retail Consortium which showed confidence down three points February from January, the fifth consecutive month in which expectations have worsened.
The GfK index measuring changes in personal finances during the last year is up three points at -7; seven points better than February 2024 and the forecast for personal finances over the next 12 months is up four points at +2, which is two points better than this time last year. But according to the BRC it had its consumer personal financial situation falling 7 points from January.
GfK’s measure for the general economic situation of the country during the last 12 months is also up two points to -44, one point lower than in February 2024 and expectations for the general economic situation over the next 12 months have improved three points to -31, still seven points worse than February 2024.
The Major Purchase Index is also up three points to -17, eight points better than this month last year, while The Savings Index stayed at +30 in February, one point higher than this time last year.
Neil Bellamy, Consumer Insights Director, NIQ GfK, said it its reading: “The biggest improvement is in how consumers see their personal finances for the coming year with an increase of four points that takes this measure out of negative territory to +2.
“The Bank of England interest rate cut on 6 February will have brightened the mood for some people, but the majority are still struggling with a cost-of-living crisis that is far from over. Prices are still rising above the Bank of England’s target; gas and electricity bills remain a challenge for many households. So it’s no surprise that consumer views on the general economic situation are still lower than 12 months ago, suggesting that people don’t expect the economy to show any dramatic signs of improvement soon. Politicians looking for bright spots on the horizon will be disappointed.”
Interestingly, with the survey coming on the day that the UK’s statistics body said January retail sales volumes rose, home delivery expert Parcelhero said that “shoppers may say they are worried about the state of the economy, but that didn’t stop them splashing out at the supermarket”.
Its head of Consumer Research, David Jinks, said consumers might not actually be feeling as bad as they think they are.
“When it came to actually spending money, it seems that they actually splashed the cash more in January than at any time in the last few months,” he said.
It will be interesting to see how both the retail sales picture and the consumer confidence picture develop in the months ahead.
The Perfume Shop and Deliveroo are extending their retail partnership to cover further UK locations, following a successful launch period last year.
The widening of its association, launched last year as Eau De-Liveroo x The Perfume Shop, comes as research reveals 47% of Britons have forgotten to wear or pack their favourite perfume when heading out, “leaving them feeling annoyed (24%), or unprepared (18%)”.
During peak periods, the retailer said the partnership managed to directly generate in-store sales in 21 locations covering London, Manchester, Bristol, Birmingham, Leeds, Glasgow and Edinburgh. “With over 1,000 perfumes available for quick delivery, the partnership has proven particularly popular during key shopping seasons over Black Friday and throughout December”, it added.
Milton Keynes was the most recent to introduce the Deliveroo app service, and there are plans to continue rolling out additional locations over 2025.
Gill Smith, managing director at The Perfume Shop said: “The success of our partnership… is a testament to the growing demand for seamless, on-demand shopping experiences”
Suzy McClintock, VP for New Verticals at Deliveroo added: “This successful partnership has not only driven sales but is also helping reshape the way customers shop by offering fast, on-demand delivery of over 1,000 fragrances across the UK.
Deliveroo is also continuing to expand its partnership to other retailers including Hurr, Accessorize, Hemp and Boots.
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