Putin isn’t letting sanctions hit Russia without a fight, as he prepares to seize Western assets still in the country.
A series of crippling Western sanctions and international condemnation for Russia’s invasion of Ukraine has pushed foreign companies into a voluntary exodus from Russia, with more global brands joining the list by the day.
Tech giants such as Apple and Samsung have pulled their products from the country, while fast food chains including McDonalds and Starbucks have joined massive retailers like Ikea in closing down all their locations, stores, and factories in the country.
But Putin appears to be willing to put up a fight, even if it might not translate to any big wins for the embattled Russian president.
Speaking with government officials during a video call on Thursday, Putin said he would be seeking “legal solutions” that could permit him to seize the assets of Western companies that made the call to close up shop in Russia.
Putin claimed that the government would be able to “introduce external management and then transfer these enterprises to those who actually want to work,” implying that these assets would be repurposed to be used by Russian businesses, and that the move would protect domestic industry. “By no means must we allow any harm to local Russian suppliers,” he said.
Russian Prime Minister Mikhail Mishustin said that legislation had been drafted to do so, and the country’s economic ministry announced policies to take temporary control of businesses in which foreign ownership is higher than 25%. The economic ministry plans to auction off seized assets, rather than nationalize them under the state, according to Bloomberg.
But even though Western businesses still hold assets and physical locations in Russia, none of them produce goods there anymore, minimizing any potential business or value these companies could create.
Apple, for instance, did not manufacture any of its products in Russia before the invasion, and the company has announced that it will halt all sales and shipping of its items to Russia. So even if the Russian owners were to reclaim an Apple Store, it would be empty.
Putin would likely encounter similar problems trying to create any value of other foreign-owned assets still left in Russia. Retailers including Nike, Zara, and Levi’s have all announced plans to leave the country, but like Apple, the supply chains of their products to Russia have already been interrupted.
However, some assets left behind in Russia certainly do have value. The government is reportedly planning on seizing and impounding $10 billion worth of jet planes that were leased by foreign companies to Aeroflot, Russia’s national airline, according to The Guardian.
The move is among Putin’s first retaliatory attacks on sanctions, and may aggravate Western leaders even further.
“If they were to take those actions, I’m certain there would be steps we would take,” White House Press Secretary Jen Psaki said at a press briefing on Wednesday when asked how the Biden administration might react to Putin seizing Western assets in Russia.