A woman walks past a closed Starbucks cafe in central St Petersburg, Russia, on May 23, 2022. Reuters
A woman walks past a closed Starbucks cafe in central St Petersburg, Russia, on May 23, 2022. Reuters
A woman walks past a closed Starbucks cafe in central St Petersburg, Russia, on May 23, 2022. Reuters
A woman walks past a closed Starbucks cafe in central St Petersburg, Russia, on May 23, 2022. Reuters

Business

Starbucks to exit Russia after suspending activities in March

Coffee chain has 130 stores in Russia, owned and operated by its licensee Alshaya Group, with nearly 2,000 employees

Reuters

May 23, 2022

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Starbucks said on Monday it will exit the Russian market after nearly 15 years as the coffee chain joins McDonald's in marking the end of the presence of some of the top Western brands in the country.

The Seattle-based company has 130 stores in Russia, operated by its licensee Alshaya Group, with nearly 2,000 employees in the country.

Starbucks' decision to wind down its operation in Russia is different to the approach some other foreign companies have taken.

McDonald's last week said it was selling its restaurants in Russia to its local licensee Alexander Govor to be rebranded under a new name, but will retain its trademarks. Meanwhile, France's Renault is selling its majority stake in Russia's biggest carmaker with an option to buy back the stake.

A number of other Western companies, including Imperial Brands and Shell, are cutting ties with the Russia market by agreeing to sell their assets in the country or handing them over to local managers.

Starbucks did not provide details on the financial impact of the exit. McDonald's had said it would take a primarily non-cash charge of up to $1.4 billion.

Early in March, Starbucks shuttered its stores and suspended all business activity in Russia, including the shipment of its products to the country, following Moscow's invasion of Ukraine.

Starbucks, which opened its first outlet in Russia in 2007, said it will continue to support its employees there, including paying them for six months.

Russian media outlet Sota Vision reported earlier in the day, citing a source, that Starbucks is closing down its Russian legal entity.

Sony's game division and Nintendo said they have suspended shipments of software and hardware to Russia. Nintendo said it is suspending shipping all products to Russia "for the foreseeable future... due to considerable volatility surrounding the logistics of shipping and distributing physical goods." AFP
Sony's game division and Nintendo said they have suspended shipments of software and hardware to Russia. Nintendo said it is suspending shipping all products to Russia "for the foreseeable future... due to considerable volatility surrounding the logistics of shipping and distributing physical goods." AFP
Rio Tinto said it "is in the process of terminating all commercial relationships it has with any Russian business". It has an alumina joint venture with Moscow-based United Rusal International. Reuters
Rio Tinto said it "is in the process of terminating all commercial relationships it has with any Russian business". It has an alumina joint venture with Moscow-based United Rusal International. Reuters
McDonald's is temporarily closing all 847 of its restaurants in Russia. AFP
McDonald's is temporarily closing all 847 of its restaurants in Russia. AFP
Starbucks is suspending all business activity in Russia, including shipments of its products and cafes run by licencees. AFP
Starbucks is suspending all business activity in Russia, including shipments of its products and cafes run by licencees. AFP
Coca-Cola is suspending sales in Russia. Coca-Cola said its business in Russia and Ukraine contributed about 1 to 2 per cent of the company's net operating revenue in 2021. Reuters
Coca-Cola is suspending sales in Russia. Coca-Cola said its business in Russia and Ukraine contributed about 1 to 2 per cent of the company's net operating revenue in 2021. Reuters
PepsiCo is suspending sales of its sodas in Russia. It said it would continue to sell daily essentials, such as milk and other dairy offerings, baby formula and baby food, in Russia. Getty Images / AFP
PepsiCo is suspending sales of its sodas in Russia. It said it would continue to sell daily essentials, such as milk and other dairy offerings, baby formula and baby food, in Russia. Getty Images / AFP
Yum Brands, behind KFC and Pizza Hut, also said it was suspending investment in Russia. Reuters
Yum Brands, behind KFC and Pizza Hut, also said it was suspending investment in Russia. Reuters
Toyota is halting production at its plant in St Petersburg, and will halt vehicle shipments to Russia. Reuters
Toyota is halting production at its plant in St Petersburg, and will halt vehicle shipments to Russia. Reuters
Ikea said it would suspend its activities in Russia and Belarus, affecting nearly 15,000 employees, 17 stores and three production sites. AFP
Ikea said it would suspend its activities in Russia and Belarus, affecting nearly 15,000 employees, 17 stores and three production sites. AFP
Honda will stop exports of cars and motorcycles to Russia. EPA
Honda will stop exports of cars and motorcycles to Russia. EPA
Jaguar Land Rover has paused the delivery of its cars to Russia due to "trading challenges".
Jaguar Land Rover has paused the delivery of its cars to Russia due to "trading challenges".
Airbus is suspending sale of parts and support services to airline customers in Russia. Reuters
Airbus is suspending sale of parts and support services to airline customers in Russia. Reuters
Boeing has suspended major operations in Moscow and temporarily closed its office in Kyiv. It is also suspending parts, maintenance and technical support services for Russian airlines. Reuters
Boeing has suspended major operations in Moscow and temporarily closed its office in Kyiv. It is also suspending parts, maintenance and technical support services for Russian airlines. Reuters
Nike has made merchandise purchases on its website and app unavailable in Russia as it cannot guarantee delivery of goods to customers in the country, an update on the sportswear maker's website showed. Bloomberg
Nike has made merchandise purchases on its website and app unavailable in Russia as it cannot guarantee delivery of goods to customers in the country, an update on the sportswear maker's website showed. Bloomberg
German sportswear company Puma has stopped deliveries to Russia, but its 100 stores are open. Getty Images
German sportswear company Puma has stopped deliveries to Russia, but its 100 stores are open. Getty Images
Shell is to exit all its Russian operations, including a major liquefied natural gas plant. The company also plans to end its involvement in the Nord Stream II gas pipeline from Russia to Germany. PA
Shell is to exit all its Russian operations, including a major liquefied natural gas plant. The company also plans to end its involvement in the Nord Stream II gas pipeline from Russia to Germany. PA
BP is exiting its 19.75 per cent shareholding in Russian oil giant Rosneft after pressure from the UK government. BP has operated in Russia for more than 30 years. Reuters
BP is exiting its 19.75 per cent shareholding in Russian oil giant Rosneft after pressure from the UK government. BP has operated in Russia for more than 30 years. Reuters
ExxonMobil will cease operations in Russia and refrain from making new investments in the country. It holds a 30 per cent stake, alongside Rosneft, Japan's Sodeco and India's ONGC Videsh, in the Sakhalin Island oil and gas fields in Russia’s far east. Its business in the country is valued at more than $4 billion. AFP
ExxonMobil will cease operations in Russia and refrain from making new investments in the country. It holds a 30 per cent stake, alongside Rosneft, Japan's Sodeco and India's ONGC Videsh, in the Sakhalin Island oil and gas fields in Russia’s far east. Its business in the country is valued at more than $4 billion. AFP
Eni said it would withdraw from the Blue Stream gas pipeline linking Russia to Turkey, in which it has a 50 per cent stake. The company controls the gas pipeline -- which links the two countries via the Black Sea -- equally with Russian energy giant Gazprom. Reuters
Eni said it would withdraw from the Blue Stream gas pipeline linking Russia to Turkey, in which it has a 50 per cent stake. The company controls the gas pipeline -- which links the two countries via the Black Sea -- equally with Russian energy giant Gazprom. Reuters
British Gas owner Centrica has said it will exit gas supply agreements with its Russian counterparts, including Gazprom. Centrica said it currently has a medium-term contract with Gazprom Marketing and Trading, the Russian energy company's UK entity, through which gas can be sourced from the open market. Reuters
British Gas owner Centrica has said it will exit gas supply agreements with its Russian counterparts, including Gazprom. Centrica said it currently has a medium-term contract with Gazprom Marketing and Trading, the Russian energy company's UK entity, through which gas can be sourced from the open market. Reuters
Norwegian energy group Equinor said it will start the process of divesting from its joint ventures in Russia. Reuters
Norwegian energy group Equinor said it will start the process of divesting from its joint ventures in Russia. Reuters
HSBC said it was starting to wind down relations with a host of Russian banks including the second-largest, VTB, one of those targeted by sanctions, a memo seen by Reuters showed. AFP
HSBC said it was starting to wind down relations with a host of Russian banks including the second-largest, VTB, one of those targeted by sanctions, a memo seen by Reuters showed. AFP
Volkswagen suspended deliveries of cars to dealers in Russia. 'Deliveries are to resume as soon as the effects of the sanctions imposed by the European Union and the United States have been clarified', a VW representative said. AP
Volkswagen suspended deliveries of cars to dealers in Russia. 'Deliveries are to resume as soon as the effects of the sanctions imposed by the European Union and the United States have been clarified', a VW representative said. AP
Swedish automaker Volvo Cars said it would suspend car shipments to the Russian market until further notice, becoming the first international car maker to do so. Supplied
Swedish automaker Volvo Cars said it would suspend car shipments to the Russian market until further notice, becoming the first international car maker to do so. Supplied
GM said it would suspend all vehicle exports to Russia until further notice. The Detroit company does not have plants in Russia, only sells about 3,000 vehicles annually in the country and has limited supply-chain exposure. AFP
GM said it would suspend all vehicle exports to Russia until further notice. The Detroit company does not have plants in Russia, only sells about 3,000 vehicles annually in the country and has limited supply-chain exposure. AFP
Danish shipping giant Maersk said that it would stop taking new non-essential orders to and from Russia, owing to sanctions imposed over Moscow's invasion of Ukraine. AFP
Danish shipping giant Maersk said that it would stop taking new non-essential orders to and from Russia, owing to sanctions imposed over Moscow's invasion of Ukraine. AFP
Singapore-headquartered container shipping company Ocean Network Express has suspended bookings to and from Russia. Reuters
Singapore-headquartered container shipping company Ocean Network Express has suspended bookings to and from Russia. Reuters
AerCap Holdings, the world's biggest plane lessor with about 5 per cent of its fleet leased to Russian airlines, said it will stop trading with Russian customers. Reuters
AerCap Holdings, the world's biggest plane lessor with about 5 per cent of its fleet leased to Russian airlines, said it will stop trading with Russian customers. Reuters
US-based United Parcel Service said it is halting delivery services to Russia and Ukraine. Bloomberg
US-based United Parcel Service said it is halting delivery services to Russia and Ukraine. Bloomberg
FedEx also said it is temporarily suspending inbound and outbound services to Ukraine and inbound services to Russia until further notice. AP
FedEx also said it is temporarily suspending inbound and outbound services to Ukraine and inbound services to Russia until further notice. AP
Microsoft said it would remove Russian state-owned media outlet RT's mobile apps from its Windows App store and ban ads on Russian state-sponsored media. Reuters
Microsoft said it would remove Russian state-owned media outlet RT's mobile apps from its Windows App store and ban ads on Russian state-sponsored media. Reuters
Google has barred RT and other Russian channels from receiving money for ads on websites, apps and YouTube videos. Reuters
Google has barred RT and other Russian channels from receiving money for ads on websites, apps and YouTube videos. Reuters
German heavy-goods vehicle group Daimler Truck has said it will cease its co-operation with Russian lorry-maker Kamaz. AFP
German heavy-goods vehicle group Daimler Truck has said it will cease its co-operation with Russian lorry-maker Kamaz. AFP
Motorcycle maker Harley-Davidson has suspended shipments of its bikes to Russia. Pictured, Russian President Vladimir Putin. Reuters
Motorcycle maker Harley-Davidson has suspended shipments of its bikes to Russia. Pictured, Russian President Vladimir Putin. Reuters
Facebook owner Meta Platforms has restricted access to accounts run by Sputnik and RT in the EU. Reuters
Facebook owner Meta Platforms has restricted access to accounts run by Sputnik and RT in the EU. Reuters
Apple has paused all product sales and limited the functionality of other services in Russia. Reuters
Apple has paused all product sales and limited the functionality of other services in Russia. Reuters
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New UK refugee system

 

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Name: Tharb

Started: December 2016

Founder: Eisa Alsubousi

Based: Abu Dhabi

Sector: Luxury leather goods

Initial investment: Dh150,000 from personal savings

 

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