Ikea suspends Russia, Belarus operations, affecting 15,000 staff

Agence France-Presse

Posted at Mar 04 2022 05:48 AM

General view of the IKEA hypermarket in St. Petersburg, Russia, March 3, 2022. The Swedish IKEA brand announced the closure of its hypermarket chain in Russia from March 4. Anatoly Maltsev, EPA-EFE
General view of the IKEA hypermarket in St. Petersburg, Russia, March 3, 2022. The Swedish IKEA brand announced the closure of its hypermarket chain in Russia from March 4. Anatoly Maltsev, EPA-EFE

Swedish furniture giant Ikea said Thursday it would suspend its activities in Russia and Belarus, affecting nearly 15,000 employees, 17 stores and 3 production sites, in response to the war in Ukraine.

The move was the latest in a slew of responses by companies to Moscow's invasion of its neighbor, while the United States, the European Union and Britain have all unleashed severe economic sanctions, including targeting of Russian banks and its transport sector.

"The war has had a huge human impact already. It is also resulting in serious disruptions to supply chain and trading conditions. For all of these reasons, Ikea has decided to temporarily pause operations in Russia," the company said in a statement to AFP.

The suspension mainly concerns Russia, where the Swedish group has been present since 2000 and is one of the largest Western employers.

Operations in Belarus would also be halted, though the country hosts only a few suppliers and has no shops, according to Ikea.

"The devastating war in Ukraine is a human tragedy, and our deepest empathy and concerns are with the millions of people impacted," the company said.

"These decisions have a direct impact on 15,000 Ikea co-workers, and the company groups will secure employment and income stability and provide support to them and their families in the region," Ikea said.

While the stores operated by the Ingka group account for the bulk of the workforce affected, 12,000 people, Ikea also has nearly 2,500 employees working in manufacturing, with three factories in Russia.

According to the company, 47 suppliers in Russia and 10 in Belarus, would be affected by the decision, which also puts a stop to imports and exports between the two countries. 

Prior to this announcement, Ikea had initially announced that it would leave its shops in Russia open, which was met with criticism in Sweden.

The Ikea Foundation also announced Thursday that it would donate 20 million euros ($22 million) in response to the UN's appeal to address the humanitarian crisis.

"We have never provided a donation of this size to a crisis before," a spokeswoman for the foundation told AFP.

RELATED VIDEO

Watch more on iWantTFC