Subscribe
E-Paper
 |
| LG Electronics' plant in Ruza, Russia / Korea Times file |
By Kim Hyun-bin
LG Electronics has suspended all shipments of goods to Russia, following Samsung Electronics' decision to do so, due to the disruption in global maritime logistics that has worsened in the wake of Russia's invasion of Ukraine.
"LG Electronics is suspending all shipments to Russia and will continue to keep a close watch on the situation as it unfolds," LG Electronics said through its global newsroom. "We are deeply concerned for the health and safety of all people, and LG remains committed to supporting humanitarian relief efforts."
The company says the suspension of shipments to Russia came in response to global maritime logistics disruptions.
Global shipping companies such as Germany's Hapag-Lloyd, Denmark's Musk and Switzerland's MSC have suspended shipping to Russia due to their participation in sanctions against Russia.
Earlier this month, Samsung Electronics announced that all shipments to Russia had been suspended due to logistics disruptions.
However, neither company has declared a total boycott of sales to the Russian market. Nevertheless, analysts believe the companies have taken a position that satisfies the international community on sanctions against Russia.
After Russia invaded Ukraine last month, global companies such as Starbucks, Coca-Cola, Nike, Apple, GM, PayPal, FedEx, Boeing and Tesla have been taking part in the boycott of Russia.
Although public opinion on the international sanctions is strong, local companies are hesitant to take part in the boycott prematurely, as their large investments and leading sales in the Russian market could make them lose ground to pro-Russian countries such as China. This situation is why the companies have chosen to suspend their shipments to Russia instead of taking part in the boycott directly.
LG Electronics operates a home appliance and TV production plant at a factory outside of Moscow. Products produced at this plant are sold to Russia and the neighboring Commonwealth of Independent States (CIS).
Although LG Electronics' Russian plant is currently in operation, disruptions are inevitable if the suspension prolongs and their stock of key parts is exhausted.
According to LG Electronics' business report, last year's sales in Russia and the neighboring region totaled 2.033 trillion won ($1.68 billion).
