Telecoms equipment maker Nokia is pulling out of the Russian market, its CEO told Reuters, going a step further than rival Ericsson, which said on Monday it was indefinitely suspending operations in the country.
Hundreds of foreign companies are cutting ties with Russia after the February 24 invasion of Ukraine and Western sanctions against Moscow.
While several sectors, including telecoms, have been exempted from some sanctions on humanitarian or related grounds, Nokia said it had decided that leaving Russia was the only option.
“We just don’t see any options to continue in the country under the current circumstances,” said CEO Pekka Lundmark in an interview.
He added Nokia will continue to support customers during the phase-out and it’s not currently possible to say how long the phase-out would take.
Nokia is applying for the appropriate licenses to help customers comply with current sanctions, it said in a statement.
Both Nokia and Ericsson made a low single-digit percentage of sales in Russia, where Chinese companies like Huawei and ZTE have a larger share.
Nokia doesn’t expect this decision to affect its 2022 outlook, but said it would result in a provision of about 100 million euros ($109 million) in the first quarter.
Russia is also at odds with Finland and Sweden, the home countries of Nokia and Ericsson, over their interest in joining the NATO military alliance.
Russia had also pushed for companies to start building networks using only Russian equipment, in a bid to persuade Nokia and Ericsson to set up factories in the country.
Lundmark said Nokia will not go ahead with a plan announced in November to set up a joint venture with Russian company YADRO to build 4G and 5G telecom base stations.
Nokia’s decision to leave Russia will affect about 2,000 workers, and some of them could be offered work in other parts of the world, Lundmark said.
Nokia has approximately 90,000 employees worldwide.
“A lot would have to change before one could consider doing business in the country again,” said Lundmark.
https://nypost.com/2022/04/12/nokia-to-stop-doing-business-in-russia/ Nokia ceases operations in Russia