Not just sanctions: how manufacturing companies affect Russia's military potential

6 March 2024
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Not just sanctions: how manufacturing companies affect Russia's military potential

On February 24, on the second anniversary of Russia's full-scale invasion of Ukraine, the American publication MarketWatch published an article about the role of major corporations in isolating Russia and rebuilding Ukraine.

Since the beginning of the full-scale invasion, more than 1,000 companies have exited the Russian market. Some companies have minimized their activities or ceased tax payments to the aggressor country. However, some continue to operate as if nothing has happened. These companies consistently face pressure because their activities directly or indirectly support the Russian military-industrial complex and, consequently, the genocide of Ukrainians.

According to Denys Hutyk, a senior advisor to the Economic Security Council of Ukraine (ESCU), the issue and risks lie not only in the direct presence of foreign companies in Russia but also in insufficient control over supply chains, allowing Russia to acquire necessary technologies through gray schemes.

"Sanctions are not the only solution. Responsible and forward-thinking businesses should invest in new compliance procedures and supply chain control now because this is not a short-term crisis but a long-term trend".

"Western manufacturers of products critical to the Russian military-industrial complex have perhaps the greatest influence on disrupting the aggressor's supply chains. In conditions where the line between civilian and military products is increasingly blurred, insufficient control of producers over their supply chains gradually becomes a threat to global security" — emphasized Denys.

Regarding Ukraine, Andy Gunder, President of the American Chamber of Commerce in Ukraine, stated, "Despite the difficulties, the business community, inspired by brave defenders, continues to work and believe in Ukraine, supporting the economy, paying taxes, and providing Ukrainians with employment."

The country continues its physical and economic resistance and remains open for business.

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